We Highlighted Bankrate Before Shares Jumped 12% in 5 Days
Last week, we highlighted a potential trade from the Indicator Lists.
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Last Thursday, Bankrate
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RATE |
Quote |
Chart |
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PowerRating) was a selection from the 5+
Consecutive Lower Lows stock list. The stock had fallen nearly 20% in
around 2 weeks, which meant share price was at extended, oversold levels.
Over and over at TradingMarkets, we stress that you should buy on weakness,
and sell on strength. It’s also easy to frame that in the classic trading
phrase, “Buy low, sell high.” Buying low means that you are entering a stock
after it has fallen, and selling high means that you are selling the stock after
a rally. Despite how simple that concept is, many traders still have a problem
with buying stocks that have fallen to extended lows.
When a stock has lost nearly 20% in 2 weeks, you can just imagine the
headlines on CNBC. Bankrate: When Good Stocks Go Bad.
In reality, these are the times you should be buying! Bankrate is a
technically strong stock, trading above its 200-day moving average. The
long-term momentum has an upward bias, and that is where the underlying strength
lives for the snap-back. In millions of back-tested trades, we have found a
historical edge in strong stocks that have fallen to extended lows. We use our
indicator lists to highlight these edges.
From low to high, RATE gained 12.2% in 5 trading days. Obviously, it’s a
perfect situation to buy on the lows and sell on the highs, and those results
are based on a hypothetical, perfect trade. But the point is, you can use our indicators
to pinpoint tradeable edges. In the past, stocks have acted a certain way, and
we’re betting that they will probably continue to do so.
Bankrate
(
RATE |
Quote |
Chart |
News |
PowerRating) has a PowerRating (for Traders) of 4.
