Tip: Adding the Fundamental Guru methodology scores

Monday, 10 November 2008 22:13 by Admin

So far I already posted two articles about my favorite search criteria and research tools to pick potential candates. But the indicators involved were mainly technical. If you base your selections purely on technical analysis you have to be agrressive in your entries and exits. In this case you will most likely use the hourly and the minute charts.

Now to convince ourselves with our picks we will add Fundamental analysis. The analysis will be based on scores/grades of the available guru methodologies. For aggresive trades, you would set the Validea>=0.5 and Price Sales >=0.5. The two guru methodologies are choosen because of it's accuracy and profitability. For more reference about the performance benchmarks of the guru methodologies, visit the link http://validea.com/stocks/mp.asp

Once you have the short-list of candidates, use the hourly(or 15min,30min) stochastic charts for your entries as well as your exits. Your entry can vary 1-3 days from the scan date.

 

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Trading Tips

Use several charts in different time periods for each stock you are trading. 60, 13, 8, 3, and 1 minute charts will enable you to see the bigger picture. If the 60, 13, and 8 minute charts are in an uptrend, look at the 3 / 1 minute charts for an entry into the trend, such as when the lead stochastic moves up from the 20 band. Don't fight the trend of the longer time frames, but if your trade is going against the major trend, be aware that you won't want to stay in it for too long.

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