The Most Important Hour of the Trading Day
Stockscores.com Perspectives for the week ending June 18, 2016
In this week's issue:
In This Week's Issue:
- Help Support BC Special Olympics
- Stockscores' Market Minutes Video - What Are Your Expectations?
- Stockscores Trader Training - The Most Important Hour of the Trading Day
- Stock Features of the Week - Stockscores Simple Weekly on Penny Stocks
Help Support BC Special Olympics
As you may know, my friend Michael Campbell has been volunteering with Special Olympics for many years. The impact the organization makes on children, teens and adults with intellectual disabilities never ceases to amaze me. It's exciting to see.
Special Olympics athletes and their families deserve much more, which is why Mike and I are asking for your help.
The Goldcorp Invitational Golf Tournament is one of only two public fundraisers done by Special Olympics BC and hence is extremely important to Special O's ability to provide programs for kids as young as two years old. Obviously not everyone can participate in the golf tournament but we can all help by bidding in the online auction.
It runs only this week and closes at noon on Tuesday, June 21st - and then all high bids go through to the live action at the tournament to see if anyone wants to put in a higher bid. Here's an auction sample:
• Turtle Bay Resort, on Oahu's North Shore, is the original A List Resort, ranked in the top 75 in the World by Golf Digest. Famed golfer Arnold Palmer liked it so much he designed a golf course specifically to take advantage of Turtle Bay's breathtaking natural beauty. Bid on a four-night resort experience complete with a range of activities including golf, spa, mountain biking and water sports.
And there is much more. Concerts, trips, dinners, signed jerseys, jewelry, gift certificates - or just a straight ahead donation. Have a look at the first page of auction items by clicking here, and also check out the full list of auction items too - http://www.specialolympics.bc.ca/goldcorp-invitational-auction
It not only means a lot to Mike and I, but more importantly, your donation or bid provides help to some very deserving individuals.
Thanks for your support,
Tyler
Stockscores Market Minutes Video - What Are Your Expectations?
Setting reasonable expectations for your trading success is essential to actually succeeding. Set the expectations too high and you will try to hard and end up failing. That plus my regular weekly market analysis. Click Here to Watch To get instant updates when I upload a new video, subscribe to the Stockscores YouTube Channel
Trader Training - The Most Important Hour of the Trading Day
Stocks that are in play, those that have the story to capture buyer interest and enjoy market beating trends, leave clues. The outperformance of these stocks are driven by new information that gets the buyers excited and willing to pay higher prices, pushing these stocks in to market beating upward trends. Whether you like to trade large cap, well established companies or penny stocks, the signals from the market are the same.
The process to find them is very simple if you have the right tools. The Stockscores Market scan and an hour of your time at the start of the trading day will allow you to search all North American markets for the markers that telegraph a stock's future out performance. Before I explain what to look for, let me provide some insight in to the theory behind the trading concept.
Stocks that go on the steep upward trends that we all love to own do so because there is significant fundamental change in the company. Actually, to be more accurate, I should say that there is a perception of significant fundamental change. What is actually happening is not as important as what investors perceive to be happening. Sometimes stocks move simply because investors renew their interest in a good company.
These stocks move because of new information. A pharmaceutical company may have a new drug that is showing positive effects in testing. A mining company may be on the verge of a major discovery or a retailer may be enjoying great earnings because consumers love their products. Ultimately, it is about an improved potential to make money in the future.
The question you have to ask is, "Do all investors get the new information at the same time?"
The answer, of course, is no. Every stock has investors who follow the company very closely and know more about what the company is doing than anyone else. These investors have an advantage over other investors because they can uncover new information earlier.
When they do find out something significant, they act. If the new information is positive, they buy the stock aggressively, causing the stock to move up in price and trade more volume than normal. Those are the signs that we want to look for.
Most of this abnormal market activity starts during the first hour of the trading so the trader who can dedicate that time to trading can uncover around 80% of the good entry signals that come through the trading day. If you have all day then you can find the other 20% of the opportunities as well.
The Stockscores Market Scan tool allows you to scan all of the North American markets for stocks that meet a variety of criteria. There are many ways to set up the tool to look for stocks that are "in play" but here are some simple settings to apply in the first hour:
Exchange - I like to scan the Canadian exchanges separately from the US exchanges because the Canadian market is less liquid, requiring a lower liquidity threshold which I will explain in a moment. So, set this filter to either All Canadian or All American.
Gain/Loss - set this to > 3% over the past 1 days. This will find the stocks that are moving up.
15 day Resistance - set this to breakout, doing this will help you avoid the stocks that are stuck in trading ranges and unlikely to make a lasting upward trend.
Volume Relative to 20 Day Average - set this to Above.
Number of Trades - this is the liquidity requirement, to trade we need stocks that are active enough to get in and out easily. Set this to > 200 for the Canadian exchange or > 1000 for the US.
You can start to run this scan about half an hour after the market opens. When inspecting the charts, look at both the daily and the intraday 15 minute chart. You want to focus on stocks that are starting moves out of low price volatility and with market activity that really stands out relative to how the stock normally trades.
Completion of one of the Stockscores courses will soon be prerequisite to subscribe to the Market Scan tool but anyone subscribed before the cutoff date will be grandfathered.
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This week, I ran the Stockscores Simple Weekly market scan but focused the scan on stocks under $2 because there has been good strength lately in the lower priced stocks. Here are two names that have decent looking charts:Back To Top
1. V.TGV
V.TGV is a true penny stock, trading under $0.06. However, it made a good jump higher on Friday with strong volume and traded with 668 trades for the day which is decent liquidity for a TSX Venture listed penny stock. Support at $0.02.
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2. V.JAG
V.JAG is showing a nice long term turnaround chart, breaking higher from a rising bottom consolidation this week on good volume after breaking the downward trend line in February. A strong sector should help. Support at $0.36
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References
Get the Stockscore on any of over 20,000 North American stocks.
Background on the theories used by Stockscores.
Strategies that can help you find new opportunities.
Scan the market using extensive filter criteria.
Build a portfolio of stocks and view a slide show of their charts.
See which sectors are leading the market, and their components.
Disclaimer
This is not an investment advisory, and should not be used to make
investment decisions. Information in Stockscores Perspectives is often
opinionated and should be considered for information purposes only. No
stock exchange anywhere has approved or disapproved of the information
contained herein. There is no express or implied solicitation to buy or
sell securities. The writers and editors of Perspectives may have positions
in the stocks discussed above and may trade in the stocks mentioned. Don't
consider buying or selling any stock without conducting your own due diligence.
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