Wednesday, July 16, 2014

Wednesday's Prospects: Round 2

The one symbol that came out of my first round of analysis wasn't a survivor in the true sense of the word.

DG, a bear signal, is on the supplemental list. Its "survival" is akin to a World Cup player getting a red card and then being told, "You look like an OK guy. Why don't you go on and play anyway."

The supplemental list ignores the odds requirement for bear signals, as long as the symbol is liquid enough for a bear play. It recognizes the fact that the number of symbols available for bearish positions is limited, since only very liquid stocks can be sold short or traded through a bearish options position.

DG is trading still lower today and appears to have entered into a major downtrend after peaking on June 9. It is rated neutral by Zacks, the service I use as a short cut for my fundamental analysis.

I think it's worth a closer look, despite having only a 25% success rate on bear signals over the past year. I'll be posting a full analysis of DG prior to the closing bell.

See "Wednesday's Prospects" for a full description of my first round of analysis.

-- Tim Bovee, Portland, Oregon, July 16, 2014

My shorter-term trading rules can be read here. My longer-term trading rules can be read here. And the classic Turtle Trading rules on which my rules are based can be read here.

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.
No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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