Blog post: GLB (green line break-out) explained; Some stocks having a GLB last week: $MEC $OMP $TGLS $FLNG $CUBI

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One of the most important innovations I developed was the GLB or green line break-out. I like to buy stocks that have advanced to an all-time-high (ATH), consolidated for at least 3 months, and then break out to close at a new ATH. I use TC2000 to draw in the green line on a monthly chart at an ATH and alert me the moment the stock trades above the line. A green line can only be drawn after 3 months (3 monthly bars) have passed since a peak price bar that has not been surpassed (see monthly chart below). I make an exception for recent IPOs when the green line may be drawn after consolidating a few weeks after reaching a peak ATH.

Last December, I posted a weekly chart showing that PGNY had had a GLB at 36.50 and a weekly green bar (WGB). PGNY closed Friday at $64.04,  75% above its GLB.

Here is its monthly chart showing where the green line was drawn.

 

If I buy a stock after a GLB I sell it immediately  if it closes back below its green line. A failed set-up on which I base my purchase must always be sold. It is preferable for the GLB to occur on above average weekly trading volume. This weekend I identified a few stocks that have met the above criteria last week or a few weeks before. Here are their charts.

It is impossible to tell if any of these stocks’ GLB will fail or if it will rocket higher. I did look up their fundamentals on MarketSmith.  Their IBD Composite scores are MEC (78) OMP (94) TGLS (99) FLNG (98) CUBI (99). All have floats of <30 million shares.

The GMI is 6 (of 6), flashed a Green signal, and the new QQQ short term up-trend has now reached 3 days (U-3). I have begun to purchase TQQQ, the 3X leveraged bullish ETF for QQQ. If this up-trend persists I believe this is where I will likely make the most $$$$. Note that QQQ has now closed back above its 10 week average while SPY has closed above its 10 week average for 17 straight weeks.

 

Blog post: There were 469 new highs among US stocks, the most since March 18, so many stocks are doing well; $FDX had a cup and handle break-out; $CHUY, $FB moving up after retesting GLB; GLB defined

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I would have liked to see higher volume on this break-out, but FDX broke out after re-testing its last green line break-out (GLB). There is a new green line peak at 305.69 where one would expect some resistance. So this rise could continue to that level. I would then wait to see if it can have a new GLB. I tweeted about FDX intraday. You may follow my tweets @wishingwealth.

Another stock that is advancing after a retest of its GLB is $CHUY. Not sure of its fundamentals though.

$FB has also retaken its green line. Understanding the GLB can lead to some large gains. From my glossary:

Green Line Breakout (GLB)

I draw a green line on a monthly stock chart at a bar at an all-time high that has not been penetrated (or closed above) for three straight months (or 3 bars).  It basically is  a strong stock breaking out to an all-time high (ATH) after at least a 3-month consolidation.  Green line breakout stocks, in my experience, often go on to make a series of new highs as they rocket toward the moon. Most stocks I purchase are near or above their last green line top.

Here are the monthly and daily charts for FB.

Blog post: Wish-Darvas scan finds 14 stocks to monitor Monday: $CASH $CAMT $MYRG $GM $HIBB $WSM + 8 others listed

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This weekend I created a new scan column in TC2000 that puts together most of the characteristics of winning stocks that I have embraced over the years. Some were suggesetd by the great Nicolas Darvas. Most, I created based on my trading experience and reading the past 50+ years. This scan finds  stocks that meet the following criteria:

>$20, near all-time high, yellow band for 5+ weeks (see my 2012 TC2000 webinar link on my blog for the definition of yellow band stocks), reached a  new high within last 25 days, closed up today, closed up >80% from a year ago (Darvas liked +100%), bounced up off of exp 21 day or simple 30 day average today.

The 14 out of 6,081 US stocks that met these criteria as of Friday’s close appear below along with their projected next earnings dates. I copied these symbols into a watchlist to monitor on Monday with a column to show me whether Monday’s high is above Friday’s high, another sign of strength. Note that 6 of the 14 have a blue flag, indicating they came to my attention after appearing on an IBD or MarketSmith list in the recent past. I am not recommending these stocks and do not own any of them. They are listed for educational and research purposes only. Maybe some of these will turn out to be true market leaders. Remember, if I buy a stock after a bounce up off of one of these moving averages, I must sell immediately if it closes back below the average. The nice thing about this strategy is that it incorporates longer term and short term technical criteria. Before buying I check IBD or MarketSmith for strong fundamentals and projected earnings. I can run this scan every day near the close to look for possible winners.

 

Here are the daily, weekly and monthly charts of one of these stocks, CAMT,  as an example. Note the black and green dots showing oversold bounces on the daily chart.

The GMI is at 6 (of 6) and remains Green.