What to look for in good breakout anticipation candidate

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What to look for in good breakout anticipation candidate

June 27, 2014

Pradeep Bonde

I am primarily a breakout trader and it works for me. It has helped me build a big fortune in last 14 years so I stick with it.

As a breakout trader I look for area of consolidation or weakness from which stock is likely to breakout.

Not all breakouts can be anticipated, but some can be .

What to look for in good breakout anticipation candidate

series of narrow range days in pullback/consolidation
orderly pullback with no 4% b/d during the pullback or consolidation
low volume pullback
low volatility during pullback
linear first leg if looking as continuation setup
Stock should go up smoothly and not in volatile manner
3 to 10 days consolidation/pullback
not up 3 days in a row

Some good anticipation candidates

Link to Charts for top setups

CNQR
EPAM
INCY
MNKD
NBIX
OEH
RCPT
RDNT
SGMO
ULTI
WAGE
XOOM

4 comments:

Allan said...: Hi Pradeep, thanks for all your hard work on the blog, I have learned a lot from you. When you look for breakouts, what is your methodology for entering? Do you monitor the stocks in the morning and enter after a certain price point? For example today OEH appears to have broken out, did you enter? When? and what were the signals that alerted you to enter a trade? Thank you again.; Jun 27, 2014, 4:54:00 PM
Pradeep Bonde said...: I did not enter OEH today as I was away part of the day but yes I would have entered it. i enter it as soon as it shows a little move above recent high. i like entering in the morning. That way you can benefit from rest of the day move.; Jun 27, 2014, 5:41:00 PM
Unknown said...: What do you mean by the following: "orderly pullback with no 4% b/d during the pullback or consolidation." What is b/d? Don't quite follow your grammar. Could you restate?

Thanks for the daily newsletters. Very helpful. Most interested in those addressing trading principles and strategies, rather than specific stocks. I Day Trade the Russell 2000 and breakouts and reversals are crucial points of entry. Thanks again.; Jun 27, 2014, 8:45:00 PM
Pradeep Bonde said...: Stock should not have 4% plus down day during its consolidation phase; Jun 27, 2014, 8:57:00 PM

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