Market monitor is also about nature and size of opportunity

Market Monitor

Total 4% plus bullish breakouts=164
Total 4% plus bearish breakouts= 41
65 day bullish/bearish ratio= 938/269
Stocks up 50% or more in a month=12
Stocks up 25% or more in a month=115
Number of stocks with 100% plus move = 385
Number of stocks up 200% or more = 87
4% plus signals for 100plus universe=42
4% plus signals for 200plus universe=10

To many these are just numbers. But if you think about it, these numbers clearly tell you about the nature of opportunity in the market place for a given time frame.

You can look at the same set of numbers as:

• There were 385 opportunities in stocks that doubled in a 260 day time frame.
• Even if you missed the first 100% , there were 87 opportunities in stocks which went on to gain anywhere from 200 to 977% in last 260 days.
• On a quarterly time frame there were 938 opportunities in stocks with 25% plus gain. In the same 65 days 46 stocks had between 100 to 392% gain.
• If shorting is what fascinates you , then there were 254 opportunities which made between 25% to 79% on short side.
• If you are primarily a few days swing trader then you might want to see the extent of opportunity on the one month time frame.
• 96 Stocks offered 25% plus opportunity in just 20 trading days. 10 of them offered 50% plus opportunity.

Once one understands the opportunity, one can look further to find, how can I identify and trade this opportunity. You can continuously study this opportunity to figure out questions like:

• What triggers a 100% plus move in 260 days?
• What was the price action on this stock before the 100% move?
• Do stocks at top of range make 100% move or do stock at bottom of their 3 year range make 100% move?
• Are there some episodes which trigger this move?
• Does it make sense to buy breakout or weakness on such stocks?
• What was the liquidity on such stock before breakout?
• How does liquidity move over the progression of the move?
• How do these move end?
• Should you listen to perma bears
  

If you do this over a period of time or over an extended period of time, you become an expert in stocks which make 100% plus move in 260 days or less. That can be a very good edge to have in a market where people struggle to make 10%.

If we know the nature and extent of opportunity in market, we can better design strategies to exploit it. Better prioritize our efforts. And above all play in a different segment of the market. A segment of market where stocks make dramatic moves and on which most people are not consciously focused.