>>> And you're not screening for names with top scores like 80,80,80,B,B,B. <<<
I don't think the top 100 get to be the top 100 unless all of the criteria has been met. I don't follow all of the top 100 but, the ones I picked all have those ratings or better.
I'm not necessarily looking at the 50 day moving average. I'm looking at the stocks recent history and if it bounces of the 10 dma, then I wait for that. If it bounces of the 20 ema, then I'll work with that. Each stock has it's own trading patterns and that's what I look for.
IBD does most of the fundamental research. Therefore, it takes some sort of ability to be able to read charts.
Then, other times you just have to use some common sense and set a stop loss point in case you're wrong.
At the end of last week, I was looking at LEXR. The "weekly" chart was showing tremendous volume with the price going almost straight up.
stockcharts.com[h,a]waclyiay[d20010724,20030718][pb10!b50!f][vc60][iut]&pref=G
With the kind of buying that has been going on, it indicated to me that the institutions were buying. I assumed there would be very little downside if the institutions were still buying. I also assumed some people would lock some profits in after a nice week.
Having some knowledge regarding candlestick analysis, I knew that profit taking, in a strong uptrend, off a strong white candle, would come down about half way of that candle and then rebound. So, that's what I did. I waited for that little bit of weakness on Monday and I bought in. So far, the trade is working for me.
stockcharts.com[h,a]daclyiay[pb10!b50!f][vc60][iut]&pref=G
LEXR had the fundamentals, so then it was a matter of looking for an entry. I could have, and should have, bought this stock earlier in its rise but, I was slow to adjust to the trending market after having success trading off stocks that were in trading ranges, as opposed to trending.
That's one of the downfalls of success. It limits our ability to adjust to market conditions more quickly. I don't know about others but, I need to pay closer attention to market conditions. Is the market trending or consolidating? It makes a difference in how we make our trades and investments.
Most people have a tremendous fear of buying stocks like LEXR at the point I did. I may have made a bad decision, I don't know yet. What I do know is that the fundamentals support the price going much higher. If it's going to be a $30 stock or a $50 stock at some point in time, you can't enjoy the ride if you don't buy in at some point along its rise. We can't always buy a low price and then watch it rise 1000%. Our emotions wouldn't keep us in the trade anyway. We'd be giddy with our results and would have taken profits along the way.
As long as the institutions continue to buy, then this price isn't too high. Therefore, volume patterns will be something to key on.
There isn't any easy way to track the IBD 100. You merely have to scan the charts every week, looking for buying signals. Anything worth having is worth working for, in my opinion.
dabum |
