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Swing Trade Screens – Surprise, Surprise – A Few Shorts

The final list of double screened output for last week resulted in 54 charts with multiple buy signals, and 14 with more than one sell signal. That’s bullish, but doesn’t suggest major thrust. These numbers remain very small relative to the universe of more than 10,000 screened stocks. Furthermore, a preponderance of these signals were in fixed income funds and high yield stocks.

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The low output continues to reflect a rangebound market with no motive thrust either way. It’s still a meatgrinder market. Non-subscribers click here for access.

Looking at Friday on a standalone basis there were 35 buy signals and 19 sell signals. These are low to middling numbers. While bullish, they do not suggest a broad, powerful rally. Non-subscribers click here for access.

I undertook the usual visual review of the charts that met the multiple signal criteria expecting to find a few buys. I did. Two to be exact. But I found 3 that had nice setups on the short side. Go figure. All 5 picks are shown in the charts and table below. Non-subscribers click here for access.

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. 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. Non-subscribers click here for access.

The percentage gain is based on 100% cash positions, with no margin and no use of leverage or options. Non-subscribers click here for access.

7/4/22 Picks closed out in June averaged a gain of 10.1% on an average holding period of 17 calendar days. That works out to an average of 4.1% per week. There were 12 closed picks. The win rate was 75%. I would hope to continue that, but it is by no means a given. Non-subscribers click here for access.

June’s performance is not something we should expect to duplicate too often, if at all. The average weekly gain since I tweaked the methodology in mid January is just 1.29%, while trending upward lately.

6/6/22 Picks closed out in May averaged a gain of 3% on an average holding period of 2 weeks. That worked out to an average of 1.5% per week. There were 28 closed picks. 25 were shorts.

5/9/22 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.

March was better. Picks closed in March had an average gain of 4% with an average holding period of 23 calendar days.

July has been a narrowly rangebound meatgrinder market. We managed not to get chewed up by mostly staying away. So far this month only two picks have been closed out for an average loss of 2.6%. The two remaining open picks have an average gain of 3.7%. That compares with 12 closed picks in June for an average gain of 10.1%.

This week we start with 2 open picks, both buys and will add 2 buys and 3 shorts. We had no stop-outs last week.

The picks are shown on the table below. Charts are below that. Because of my late posting today, I will track the new picks with an opening price of their 12 noon New York price.

Technical Trader subscribers click here to download the complete report.

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The strategy and tactics opinions expressed in this report illustrate one particular approach to trading. No representation is made that it is the best approach, or even suitable for any particular investor. This is a developmental and experimental exercise, for the purpose of providing experienced chart traders with ideas and concepts to use or not use as they see fit. 

Nothing in this letter is meant as individual investment advice and you should not construe it as such. These picks are illustrative and theoretical. The method behind these picks is experimental, and may change over time.  I may trade my own account, and may buy, sell, sell short or cover short, or have positions in any of the stocks on the list at any time, based on a particular trading style that is unique to me. My entry and close out levels are likely to differ from those published due to the exigencies of my trading style and time constraints. I post these items in good faith for informational and educational purposes, and do not take positions in opposition to those which are published. All chart picks are actively traded stocks, and I assume that no subscriber to these reports, nor the total of all subscribers taking positions, would do so in a size that would influence the market price. 

Performance tracking assumes 100% cash basis, no margin, no options. You should not assume that recent performance as reported can or will be repeated in the future. Trading involves risk of loss. In the case of options, the loss can be 100% of the amount invested. When leverage is used the loss can exceed the account equity under certain conditions.

The opinions expressed here assume that readers are experienced investors or are working with an investment advisor.

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