On Monday, Aug. 18:
Of 261 large-cap stocks and exchange-traded funds in my analytical universe, 16 symbols broke beyond their 20-day price channels, 14 the upside and two to the downside.
Five symbols survived my initial screening, four to the upside and one to the downside. The upside breakouts are PSX, MO, CCL and QQQ. The downside breakout is PSQ.
I shall do further analysis prior to the opening bell on Wednesday, Aug. 19.
The symbols in my analytical universe all have analyst coverage through the stock-ranking company Zacks.
I screen the symbols for historical odds of a profitable signal in the direction of the breakout for the past 12 months.
If the odds of success are greater than 50%, I next screen for the absence of an earnings announcement within the next 30 days.
For bear signals, I also screen to ensure the ability to do a trade because of the presence of options with sufficient open interest for the purpose.
I sort by the results in descending order by the average yield on signals in the direction of the breakout in preparation for the second round of analysis after the opening bell.
-- Tim Bovee, San Francisco, California, Aug. 19, 2014
While traveling, I'm performing my analysis on a smaller universe of symbols and on an altered schedule. See "August Schedule" for details.
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.
My chart assessments are based on Elliott wave analysis, which tracks patterns in price movements. The principal practitioner of Elliott wave analysis is Robert Prechter at Elliott Wave International. His book, Elliott Wave Principle, is a must-read for people interested in this form of analysis, as is his most recent publication, Visual Guide to Elliott Wave Trading.
Several web sites summarize Elliott wave theory, among them, Investopedia, StockCharts and Wikipedia.
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 decision decisions for his or her own account, and take responsibility for the consequences.License
All content on Tim Bovee, Private Trader by Timothy K. Bovee is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Based on a work at www.timbovee.com.T