9/05/2006

Where is the momentum

Many people are noticing these stocks now. Momentum takes time to build and by the time most people notice it the move might be due for correction or reversal. The ideal time to pick these stocks was few weeks ago when the overall market cycle was also at the lower end of their range, the bears were smug, everyone was scared to buy.

How would you find this stock before they make these moves. Look at them carefully, at least six had outstanding earnings and in many of them the move started post earning. Track every quarter the top 2% earning performers and you would get in to these kind of moves. Rely on your own databases, screeners have many shortcomings. Many screeners operate on batch processing so there is delay between actual earnings and data being updated. Some can not calculate % when the previous quarter had a loss and this quarter has profit. Post earnings based breakouts have best success rate if you have to master one technique to beat the market this is the most potent one.

Another way to find these stocks is by using a pure momentum based method which tracks the top 1% stock on momentum. You may not capture the entire move but you will get on to all the major moves.

Stocks up 50% or more in a month
ANAD,Anadigics Inc
AOM,AnorMed Inc
CKCM,Click Commerce Inc
IAAC,Internat Asset Holdg Cp
NVEC,Nve Corp
ORCI,Opinion Research Corp
RMBS,Rambus Inc
SIGM,Sigma Designs Inc
SMP,Standard Motor Prods
SNTS,Santarus Inc
SYX,Systemax Inc
TAR,Telefonica De Argentina
VSNT,Versant Corporation
WTHN,WiderThan Co Ltd

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