Question:
-
200K or greater average daily volume
-
Base of at least 6- 8 weeks
-
Leading group (top third of all groups)
-
RS of 70 or greater – or at least rapidly increasing for the last month before breakout
-
Huge volume breakouts, 2-3 times for small caps and 1.5 times for large caps
My Response:
My fundamental score combines earnings/sales growth, margins, roe, management into one score. I recommend sticking to stocks that are ranked 23 and above. I don’t currently list daily trading volumes [update: daily avg trading volume is now provided in the Breakout Tracker. You can filter the tables by Top Industries by clicking the button under the search field (this will display stocks that are part of top groups for 10, 20 and 30 day performance. As for high volume breakouts, you can set your breakout alerts to above a certain % ,but I recommend not limiting yourself too much here.
The stocks that meet all of your requirements will be found in the Breakout Watch and Hot Stocks tables, with the best near the top. The power of this system is that it allows you to stay on top of stocks that have already broken out and returned to the pivot. Don’t forget about these opportunities. Notice that I don’t ofen purchase at the initial breakout and prefer to wait for the first pullback, especially in a choppy market. Before creating this system, I noticed I was watching the breakout and then forgetting about it and moving on to the next set of "breakouts". I wasn’t paying attention to the breakouts that were pulling back to the pivot. This system has helped me tremendously to stay on top of these opportunities.
In addition, sign up for the premarket reports that give you a list of these stocks in your email box, in addition to the breakout alerts.
What I do is just start quickly going through the charts starting at the top with Hot Stocks, then Breakout Watch, then Play the 50 Day. If you have a dual monitor setup (which I highly recommend) you can have your SI tables on one screen and entering the symbols quickly into your charting software on the other. After going through the lists I may have a list of 20 stocks that i’m really focusing on. What do I do from here? Put that cream of the crop in my real time watchlist charting package (i use TCNET currently) so i can track in real time at certain times of the day. I will also set real time alerts on those stocks that are near a breakout or pulling back to buyable range.
While I use real time alerts, I find the email alerts from the SI system very beneficial because once they are in the system I don’t have to set the alert. There are certainly times when I have missed a stock in my research, forgotten to set an alert or my real time alerts just weren’t working. In this business redundancy is very important.