Bob, Nydia
The BBB scan will yield many different looking charts but the ones that should be of primary interest are the stocks that are basing, such as PMRY, the stock that Richard used in his example.
To get a better feel for the basing, look in the monthly and weekly time frames. A 12 month daily chart will also offer some insight into the basing.
The point is that you want to be aware of the securities range.
PMRY was in a 8 - 11 dollar range for quite some time, 8 months to be precise, before breaking out.
Before using anything else try drawing trendlines and channels. They will be your 'training wheels' or 'blinders'. By channeling the 8 - 11 range in PMRY, you would have been alerted to the upside breakout in August in a very timely fashion. All the indicators turn super positive after the fact but the first thing it had to do was breakout of its range, breakout out of the channel.
Draw trendlines and channels everywhere. Practice drawing lines that contain all of the action and then try drawing those that go thru as well. By doing this you will famaliarize yourself with trends and how stocks behave. Then add one indicator at a time. Learn that indicator inside and out. Look for how an indicator works in the uptrends you've drawn and in the basing and the downtrends as well. Try it on different stocks, different industries and price.
Now you don't have to enter a BBB candidate only from a base. Some people like to find little ledges on the way up to climb aboard.
These particular traders are looking for retracements within the upward momentum. These traders are usually shorter term in time frame while the traders buying at the base might stick around for most of the ride. One has to decide what their threshhold is as soon as possible. Actually, you will probably know this within a few trades, you feel it in your gut -vbg-
I hope I have added a point or two that might be of help, please ask if I can be of any more assistance. We all have different styles and experience and can offer a well rounded approach collectively.
Regards,
Jerry |
