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So the 3/22 heavy volume may succeed or it may fail. Lets do a checklist.
1. It's more than 5% above the pivot and more than five percent above the 50 day so I don't know if this is a HTMMIS buy. It would qualify as a "Late riskier buy" as described on page B7 of today's IBD
2. Heavy enough volume on March 22 to qualify as a pocket pivot
3. Only 1 leg up so far after the breakout
4. EPS and sales growth are healthy
5. Heavy volume is averaging up, each higher in price
6. AT Margin not exceptional
7. Beat last Qs estimates
8. Recent IPO
9. Since I would expect follow on accumulation in the next 3 days as it makes it's second leg, then I am comfortable buying this here. If the accumulation doesn't show up, then something is amiss and hopefully I could close is at a 1% gain or loss in the next 3 days.
10. The higher volume at a higher price should be enough to carry the 2nd leg up another 10-15% in the next week or two.
11. The caveat is back at point 1.
No one can tell you whether or not to buy it or sell it. You may have to meet payroll today, or pay for your daughter's braces tomorrow, or you may run a mutual fund that can only trade stocks with a million shares daily average. Your trade is your own.
hi Abe...when you state it's more than 5% above the pivot, do you mean the low of the pocket pivot yesterday ($17.45)?? Also, where do you find AT MARGIN?? Thanks again for your posts!! Susanne
I restrict my reference to "pivot" to be Bill O'Neil's standard pivot point. "Pocket Pivot" I use a with much less discrimination as it is largely a description of the volume.
You can find the AT Margin in the customize column layout, under the wrench icon in the list panel at the lower right of the MarketSmith Chart.
I think that AT Margin is only available in the results of screened lists, not at random stocks that are not the result of a screen. We have to be diligent and follow the blogs and review the webinars to get even more data and tools.
You really are asking all the right questions. If you really want a leg up, drill down on the aspect of a retracement gap in strong stocks. A lot of time people have a tough time seeing it. If you see it, you will have a big leg up.
Hi Abe..i think I am understanding the concept of retracement gap..though I think that's a poor name for it because the stock does NOT actually retrace anything since it stays ABOVE the highs of the previous consolidation..I think the name itself is what's confusing...am I right? (unless it means there is a gap in the retracement meaning NO retracement!!!)
"Retracement" describes the decline after the initial thrust higher. "Gap" describes the lows being above the highs of the previous consolidation. If you've got another two words that can articulate this behavior, please let me know.
Oh! It's the decline after the most recent thrust..now that makes sense! Ok, thanks!
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