Wednesday, May 22, 2013

Thursday's Prospects

Update 5/23/2013: CORRECTS to show that at earnings announcement removes EXPR from consideration. 

On Wednesday, May 22:

Of 2,328 stocks and exchange-traded funds in this week's analytical universe, 64 that are traded on the major American stock exchanges broke beyond their 20-day price channels, six to the upside and 58 to the downside.

In addition, eight that are traded over the counter broke out, two to the upside and six to the downside

The symbols I'm analyzing are mid- and large-cap stocks having analyst coverage, as well as selected exchange-traded funds. I screened them for

  • the odds of a successful trades in the direction of the breakout over the past year, 
  • a yield adjusted by those odds of 5% 
  • or greater and absence of an earnings announcement within the next 30 days. 

For bear signals, I also screened to ensure the ability to do a trade, either because of the presence of options or sufficient liquidity to allow for short sale.

One of the major-exchange symbols, EXPR, survived my initial screening, having broken out to the upside.

None of the major-exchange symbols survived my initial screening. The one that made it through the odds and yield analysis, EXPR, was blocked by an earnings announcement.

The market has been in an uptrend for so long that symbols generally have low odds of success following bear signals, and it was on that basis that all of the downside breakouts were screened from consideration.

None of the over-the-counter symbols survived initial screening.

I'll do further analysis on the survivors that confirm their signals by trading beyond their breakout levels on Thursday, May 23.

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