How to find the best short sale candidates
TradingMarkets
Indicators
page is designed to help with your daily research, formulate trading strategies,
learn about the market and generally improve your trading knowledge. It contains
a list of “Today’s Top Stocks” broken down into a number of different categories.
Today’s
PowerRatings article is going to focus on combining
TradingMarkets
Pullbacks From Lows with PowerRatings.
Most successful momentum-based traders and money managers like to sell weak
stocks after they pull back. TradingMarkets uses a proprietary mathematical
model to identify up to 20 (in strong or choppy markets there will be fewer)
weak stocks that have pulled back from recent lows. These stocks should be
considered potential candidates to resume their longer-term downtrends. To
learn more about how to trade pullbacks successfully,
click here.
The list of 20 candidates for 06/28/06 contains 6 stocks that have
PowerRatings of 3, making them good potential short candidates.
| Symbol | PowerRating |
( ACI | Quote | Chart | News | PowerRating) |
3 |
( BRY | Quote | Chart | News | PowerRating) |
3 |
( CBD | Quote | Chart | News | PowerRating) |
3 |
( CEDC | Quote | Chart | News | PowerRating) |
3 |
( PCR | Quote | Chart | News | PowerRating) |
3 |
( TFX | Quote | Chart | News | PowerRating) |
3 |
From 1995-2005, stocks rated 7 have outperformed the S&P 500 by a better than
4-1 margin over a five-day period. Stocks rated 8 have outperformed the S&P 500
by a better than 8-1 margin; stocks rated 9 have outperformed the S&P 500 by a
13-1 margin, and those stocks that have achieved a 10
PowerRating have
outperformed the S&P 500 by a 16.9-1 margin.
Over the same test period (1995-2005), stocks with a PowerRating of 1, 2 or 3 have underperformed the
S&P 500 over the next five-days. The 1’s have performed 4.9 times worse than the
S&P 500, the 2’s have performed worse than the S&P 500, and the 3’s have only
managed 90% of the S&P 500 performance.
Reminder: We are in no way recommending the purchase or short sale of these
stocks. Trading should be based on your own understanding of market conditions,
price patterns and risk; our information is designed to contribute to your
understanding. Controlling risk through the use of protective stops is critical.
You can
attend a free
class on how to use
PowerRatings,
presented by Steve Primo, our Director of Education.
Click here
to take a free trial of
PowerRatings.
Ashton Dorkins
Editor-in-Chief
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