Trade Stocks In The News With PowerRatings
Today’s
PowerRatings
article is going to cover stocks in the news. On 06/08/06 Jos. A. Bank
Clothiers
(
JOSB |
Quote |
Chart |
News |
PowerRating) reported Q1 earnings that disappointed the market,
leading to a dramatic fall in the share price.
While the news came as a surprise to most traders and analysts, there were a
number of warning signs that could have helped you avoid substantial losses or
maybe even profited from a short sale.
One of the advantages of technical analysis over fundamental analysis is that
price action usually leads the news. The chart below is a good example. JOSB hit
a new all-time high in late March, since then the stock has been trending
steadily lower, falling beneath both its 50- and 200-day
moving averages.
A brief rally attempt stalled right at the 200-day MA and was accompanied by a
PowerRating
of 3. As a quick reminder, the
TradingMarkets PowerRatings Strategy Guide recommends stocks with low  PowerRatings
(1-3) should be avoided, or considered as potential short sale candidates.
Anyone following those guidelines would have been rewarded when the news broke
last week. JOSB lost 32.46% in the 5-days since recording a
PowerRating
of 3 on 06/05/08.
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Ashton Dorkins
Editor-in-Chief
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