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Buys Beat Shorts Again in This Week’s Swing Trade Screens

On the week, buy signals overwhelmed sell signals, thanks to Friday’s rebound, but they had the lead earlier in the week as well. The final score for the week was 186 Buys to 125 Sells. That compares with the prior week’s  235 Buys to 147 Sells and 114 Buys to 118 Sells the week before that. However, on Friday alone, there were 101 buys and just 13 sells. This suggests an up week ahead.

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The screen results come from a universe of approximately1200-1500 stocks daily that meet the criteria of trading above $6.00, and with average volume greater than a million shares per day. The final numbers show the number of stocks with at least one buy signal or sell signal during the week.

I start the weekly process by screening for daily buys and sells from the previous Friday through Thursday. I then rescreen that output, for additional signals in the progression on Thursday and Friday. The final lists this week resulted in 48 chart pick candidates on the buy side and 3 on the sell side.

I reviewed the charts from the final output visually. From that review, I chose 3 buys and no shorts. For the second straight week, all the buys were in the energy business.

Last week we started with 23 picks on the list. There were 3 buys. The rest were short sales. Two picks hit their trailing stops and were closed as of the stop price. I elected to close out one on Monday’s open. Including those and the picks still open at the end of the week gave us average gains of 1.9% with an average holding period of 13 days.

Closed picks in May have so far averaged a gain of 2.9% on an average holding period of 11 days.

April was a challenging month. The final tally of closed picks in April had an average loss of 0.4% with an average holding period of 11 calendar days. My system does not do well when the average low to low cycle duration drops below 4 weeks. Normally that doesn’t happen to often, but we must roll with the punches when it does.

March was better. Picks closed in March had an average gain of 4% with an average holding period of 23 days. The 5 picks closed out in May so far had an average gain of 4.3% on and average holding period of 12 days.

The percentage gain is based on 100% cash positions, with no margin and no use of leverage or options.

This week we start with 23 picks including the 3 new ones. 17 of the 23 picks are short sales.

I’ve added new stops to the picks from last week, and adjusted stops on the remainder. This week’s new picks will be added without stops as usual. I like to give them breathing room at the beginning, and manage risk by having multiple picks.

The new picks, along with picks that remain open, and those closed out last week, are shown on the table below. Charts of new and open picks are below that.

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