By my method, I reject out-of-hand any signal on a stock that will be reporting earnings in the next six weeks. There's too great a chance for an analyst surprise.
Otherwise, many signals are on stocks that lack a strong trend or that are counter to a strong trend. I'm a trend follower, so those two aspects are deal killers.
And any signal based on a news report won't make the grade, on grounds that the news has already been priced in .
Here are signals that were flawed in some respect:
Counter-trend: QQQQ, AMZN, UTX, BDY, CAKE.
Insufficient trend: MSFT, AMD, QID, STX, QLD, SMH, ANH.
ANH was also rejected because it's price declined when it went ex-dividend.
I define the strength of a trend based on the average directional index. It must be 30 or above to meet my criteria.
I define the direction of a trend based on the "look" on a three-month daily chart. No precise analysis needed: I know a trend when I see it.
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