3 Top PowerRatings Pullbacks for Traders: VMI, GMO, CYBX
What is more exciting than an average stock that becomes a high Short Term PowerRating stock in a single session?
Okay, maybe you had to be there. But while the world was decrying oil prices topping $118 a barrel and the Euro topping $1.60 to the greenback, short term stock traders following our Biggest PowerRatings Upgrades lists noticed several stocks rise from the ranks of the average to the level of potential outperformer.
While a number of stocks had their Short Term PowerRatings upgraded over the course of the trading day on Tuesday, many of these upgrades were relatively modest affairs: a 6 or a 7 bumping up to an 8.
But when stocks that have Short Term PowerRatings of 5 or even 4 suddenly are sporting Short Term PowerRatings of 8, that’s is an occasion worth noting.
Two of the stocks in today’s report, General Moly
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PowerRating) began the day with a barely-average Short Term PowerRating of 4.
All three stocks ended the day with Short Term PowerRatings of 8.
How significant are these upgrades? Our research into short term stock price behavior, research that involved millions of simulated short term trades between 1995 and 2007, indicated that stocks with Short Term PowerRatings of 8 outperformed the average stock by a margin of more than 8 to 1 after five days.
These means that all three of the stock’s in today’s report went from being the standard to, potentially, ready to beat the standard. Traders looking for short term trading opportunities to the long side should consider these three as potential candidates.
Another attractive feature about all three stocks is that they all have 2-period Relative Strength Index values that have fallen sharply as the stocks have pulled back. General Moly’s 2-period RSI fell from 32.09 to 12.15. Cyberonics Inc.’s 2-period RSI fell from 31.69 to 13.09, and Valmont Industries’s 2-period RSI slipped from 49.93 to 14.93. Should the 2-period RSIs in these stocks halve again over the next few days, then they will be all the more attractive for traders looking to buy weakness above the 200-day moving average.
There are five things that every successful short term stock trader knows about trading markets like these. We have published all five in a new, special report called “5 Secrets to Short Term Stock Trading Success” now available for free. Learn what key factors are involved in turning mediocre speculators into professional-grade, short-term stock traders–and how our Short Term PowerRatings can play a part. Click here for your free report–or call us today at 888-484-8220.
David Penn is Senior Editor at TradingMarkets.com.