Did You Look to Buy LVS When it Made 5 Lower Lows?
Each day,
TradingMarkets publishes
7 Trading Ideas for Today, a selection of stocks from our daily indicators. TradingMarkets
Stock Indicators are based upon our latest quantitative research, and
highlight trading edges backed by our database of more than 7-million historical
simulated trades.
On Friday,
April 13,
Las Vegas Sands
(
LVS |
Quote |
Chart |
News |
PowerRating) was
the candidate from the
5+ Lower Lows
list.
These are stocks that have made a lower low for five or more consecutive days
and are trading above their 200-day moving average. Our research shows that
stocks trading above their 200-day moving average that make lower lows for five
or more days have shown positive returns, on average, 1-day, 2-days and 1-week
later. Historically, these stocks have provided traders with a significant edge.
The
TradingMarkets mantra is to “buy weakness,” and that is exactly what you could
have done here. LVS has been trading within a fairly tight range for about
two months, and has coiled even more tightly through April. After making 5
consecutive lower lows, LVS entered into oversold territory, and staged a
mean-reverting bounce.
1-day later, LVS closed
+1.8%.
2-days later, LVS closed +1.9%.
5-days later, LVS closed +4.2%.
Obviously,
results like these do not occur every time, but
our quantified research clearly shows that the edges exist during extreme
oversold or overbought conditions.
Check out our
latest quantified research articles
here. If
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and develop your own watchlist of stocks with historically-backed edges.
John Lee
Associate Editor