Good to Great: 3 PowerRatings Upgrades for Traders
After all of Monday’s shaking and baking, three stocks ended the session with higher Short Term PowerRatings than they started with. These are among the stocks that traders will be looking to buy on further weakness over the balance of the week.
Should traders buy stocks as soon as their Short Term PowerRatings increase into the “consider buying” green zone of 8, 9 or 10? It is absolutely true that our research into short term stock price behavior, research that included millions of simulated trades between 1995 and 2007, has revealed that stocks with Short Term PowerRatings of 8 or higher have outperformed the average stock by a margin of more than 8 to 1.
So jump in? If you’ve been reading our PowerRatings commentaries for any length of time, then you know that context is key. The first context is whether or not the stock is above the 200-day moving average. If the stock is above the 200-day moving average, then we can consider the stock for a short term trade.
If, on the other hand, the stock is below the 200-day moving average, then the market must be above the 200-day moving average before we consider the stock—