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Monday, May 27, 2013

Price Relative Breakout Scan

Here is one last post on the price relative scan. Above is a screen shot of the spreadsheet that I use to scan for price relative breakouts (actually, it's one page of the spreadsheet, which is multiple pages; this is the page where the results are printed). I use a series of Boolean algebra statements (IF-THEN type statements), which then scan the data and return the results as columns of "1"s and "0"s. It is then up to me to interpret those results, something which I had great difficulty with in the early days of the project. While I now have the breakout patterns down pretty well, I have no idea what the other patterns mean, and was taking a look at some of those today. What I saw was pretty amazing: some of the patterns where the stock is not at a new high in price relative (a "1" in the far right column) are still strong stocks, but in the midst of pullbacks that are setting up what looks like incredibly good buying opportunities. Another pattern I looked at revealed some stocks that look like good shorting candidates.This is going to be fairly time consuming and is in the early stages, but I will be working on this so I will get more information out of this scan than just the breakouts for that day. Right now this is looking like a gold mine of information that I have barely touched.

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