Keep an eye on earnings winner
At this stage the market is down 2% or less from the high. But if you see and read what people are saying, it is as if it is the end of the world and time to stock up on emergency supplies and hit the bomb shelter.
A correction was due for sometime as we had a big move without any meaningful pullback. Now we will see how it progresses from here onward.
It is time to look at stocks that hold up well during the correction. There are many stocks that had big earnings surprise in last earnings season and had Episodic Pivots. Most of them are now pulling back. Keep an eye on them. They will likely rally in to next earnings season.
In earnings there is a cockroach effect. If you find one roach, you are sure to find more roaches. Same way one earning surprise tends to lead to more earnings surprises and same way one earnings miss tends to lead to more misses.
The Bluefin tool developed by http://patientfisherman.blogspot.com/ is a very good tool to find stocks with big earnings surprise. He maintains a database of stocks that reacted positively to earnings surprise:
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