Monday, May 2, 2016

Tuesday's Prospects

On Monday, May 2:

Of 490 large-cap stocks and exchange-traded funds in my analytical universe, eight broke beyond their 20-day price channels, six to the upside and two to the downside.

Three symbols giving trading signals with high odds of success survived initial screening, twohaving broken out to the upside and one to the downside. High-odds symbols are candidates for directional trades.

Three symbols with trading signals having low odds of success survived initial screening, all having broken out to the upside. Low-odds symbols are candidates for non-directional trades.

There are two prospects for trades coinciding with earnings announcements.

I shall do further analysis on Tuesday, May 3.

Earnings season began April 11. The higher pace of announcements will continue for about four weeks from that date.

Shoe Dog: A Memoir by the Creator of Nike
by Phil Knight

Trading signal survivors





Potential trades keyed to events

The dates are those of the events, all of them earns announcements. Events prior to the opening bell are marked "am", during the trading day "mid", and after the closing bell "pm".

Tuesday pm
Wednesday am


All eight prospect have implied volatility too low to meet my standards, and only BIDU and DVN have trading grids with open interest that is sufficient on strike prices important to building a trade. I shall reject without analysis those symbols that fail to improve on both counts after the opening bell on Wednesday.


The stocks in my analytical universe all have analyst coverage through the stock-ranking company Zacks Investment Research. Not all of the exchange-traded funds are so covered.

I screen the symbols for historical odds of a profitable signal in the direction of the breakout for the past 12 months.

For symbols whose odds of success are in the top or bottom thirds, suggesting a directional or non-directional trade, respectively, I next screen for 1) suitability of the options grid, including open interest of three figures or greater on the strike prices I would need to use to build a position, 2) implied volatility in the 60th percentile or greater of its 12-month range, and 3) the absence of an earnings announcement within the lifespan of the like options series I would trade.

-- Tim Bovee, Portland, Oregon, May 2, 2016


Tradecraft: Playing the odds to build winning stock market trades from options, a description of how I trade, can be read here.

I can be reached via comments on Private Trader posts or by email at


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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.

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Based on a work at s ss'ss

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