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Dear reader,
Each day the market opens at 9:30 AM Eastern Time. Each morning there are thousands and thousands of stocks to choose from. You could go long a biotech, you could short a bank… there are so many choices and too little time to comb through every little piece of information. Trying to pick stocks to trade over the next few weeks is nearly impossible. That is until now.
Professional traders like George Soros wouldn’t let you do it. Neither would Paul Tudor Jones. These guys guard their hot list at all costs. They would not let you look over their shoulder unless you paid them a king’s ransom.
I have been trading for over 20 years and I start each day with a group of stocks that are poised to move, and I will let you look over my shoulder. My name is Rick Pendergraft and for the last nine years I have been writing for two of the largest investment publishing firms in the world. Each day I would start with a bull/bear list.
I used to make my bull/bear list by combing through hundreds and hundreds of charts. This was very time consuming and it didn’t always work out the way I thought it would. So I started combing over the trades- looking at the ones that worked the best and looking at common traits. I also looked at the ones that did not work out and the common traits of those trades.
The results of my studies led me to do several things. The first thing I did was write a program that scans the universe of stocks and picks out stocks that meet my criteria- the common traits from my biggest winners. After I created the program and started running my scan each morning, I started studying the results of my scans.
Three Newsletters In One
I call my morning scans The Stark Report. The word “stark” meaning blunt and complete just seemed like the perfect name for such a great process that reduced the number of trade ideas from thousands to a much smaller list- the ones primed to move.
After tracking the results of the Stark Report for over six months, I found that there are three ways to benefit from the daily results:
Looking through all of the results (over 3,000 to validate my findings), the individual results are pretty good for a rough list. For instance, approximately 60% of the bearish readings went the right way in the first six days and the average win was for 9% and the average loss was for 5.75%. That’s pretty good for just generating ideas.
Now imagine taking this rough list and adding your favorite indicators- maybe you like to look at the sentiment indicators… or where the stock is compared to its 20-day moving average. Once you take the whole list and trim it down, the results could be improved to increase your winning percentage.
Let me show you the results from a day earlier this year. This table shows you both the bullish list and the bearish list and it shows you the results after 3 days, 6 days and 9 days.
|
2/12/2009 |
Last Close |
3-Day |
% Change |
6-Day |
% Change |
9-Day |
% Change |
|
Bullish |
|
2/17/2009 |
|
2/20/2009 |
|
2/25/2009 |
|
|
BGZ |
65.9 |
76.39 |
15.92% |
82.4 |
25.04% |
82.22 |
24.76% |
|
FAZ |
43.55 |
61.38 |
40.94% |
72.5 |
66.48% |
55.99 |
28.56% |
|
PAAS |
17.53 |
17.42 |
-0.63% |
16.68 |
-4.85% |
14.33 |
-18.25% |
|
RSG |
23.79 |
23.63 |
-0.67% |
23.81 |
0.08% |
22.71 |
-4.54% |
|
SDS |
78.52 |
86.88 |
10.65% |
91.01 |
15.91% |
91.44 |
16.45% |
|
SKF |
133.49 |
169.1 |
26.68% |
188.25 |
41.02% |
163.14 |
22.21% |
|
SMN |
38.18 |
42.48 |
11.26% |
44.4 |
16.29% |
47.67 |
24.86% |
|
TWM |
71.65 |
77.67 |
8.40% |
84.25 |
17.59% |
87.31 |
21.86% |
|
TZA |
55.96 |
62.96 |
12.51% |
71.29 |
27.39% |
75.02 |
34.06% |
|
|
|
|
|
|
|
|
|
|
|
|
77.78% |
-0.65% |
88.89% |
-4.85% |
77.78% |
-11.40% |
|
|
|
|
18.05% |
|
26.22% |
|
24.68% |
|
Bearish |
|
2/17/2009 |
|
2/20/2009 |
|
2/25/2009 |
|
|
AMX |
30.05 |
28.31 |
5.79% |
26.86 |
10.62% |
25.30 |
15.81% |
|
ASML |
17.22 |
16.32 |
5.23% |
15.48 |
10.10% |
15.56 |
9.64% |
|
BG |
50.13 |
48.04 |
4.17% |
48.03 |
4.19% |
48.12 |
4.01% |
|
BMC |
29.38 |
29.43 |
-0.17% |
28.84 |
1.84% |
29.00 |
1.29% |
|
EXPD |
32.02 |
30.31 |
5.34% |
29.39 |
8.21% |
28.39 |
11.34% |
|
FAST |
24.57 |
32.87 |
-33.78% |
32.19 |
-31.01% |
30.51 |
-24.18% |
|
GME |
26.51 |
25.02 |
5.62% |
26.68 |
-0.64% |
28.31 |
-6.79% |
|
HNT |
16.88 |
16.99 |
-0.65% |
16.74 |
0.83% |
14.84 |
12.09% |
|
IBN |
17.75 |
15.08 |
15.04% |
13.78 |
22.37% |
13.53 |
23.77% |
|
LO |
64.69 |
61.89 |
4.33% |
62.30 |
3.69% |
59.27 |
8.38% |
|
LRY |
27.1 |
18.74 |
30.85% |
19.16 |
29.30% |
19.36 |
28.56% |
|
MCO |
24.82 |
22.80 |
8.14% |
19.16 |
22.80% |
18.07 |
27.20% |
|
MSFT |
19.21 |
18.09 |
5.83% |
18.00 |
6.30% |
16.96 |
11.71% |
|
NNN |
15.48 |
14.05 |
9.24% |
15.11 |
2.39% |
15.26 |
1.42% |
|
OMC |
28.06 |
26.50 |
5.56% |
24.97 |
11.01% |
24.02 |
14.40% |
|
ORCL |
17.8 |
16.96 |
4.72% |
16.56 |
6.97% |
16.24 |
8.76% |
|
PBCT |
17.43 |
16.53 |
5.16% |
16.17 |
7.23% |
16.88 |
3.16% |
|
PCAR |
29.85 |
27.44 |
8.07% |
26.73 |
10.45% |
25.83 |
13.47% |
|
ROST |
31.21 |
30.19 |
3.27% |
30.79 |
1.35% |
30.29 |
2.95% |
|
STT |
28.48 |
23.21 |
18.50% |
22.72 |
20.22% |
25.77 |
9.52% |
|
|
|
|
|
|
|
|
|
|
|
|
85% |
-11.53% |
90% |
-15.83% |
90% |
-15.48% |
|
|
|
|
8.52% |
|
9.99% |
|
11.53% |
These results are unbelievable. Of the 29 signals, 25 ended up going the right direction by a huge amount. The average bullish stock went up almost 25% in 9 days. The average bearish signal went down 11.5% in 9 days. Combine these kinds of moves with the leverage of options and you are looking at some huge gains in less than two weeks!
And if you think that is a fluke, take a look at the results from March 9, less than a month later… they are even more impressive.
|
3/9/2009 |
Last Close |
3-Day |
% Change |
6-Day |
% Change |
9-Day |
% Change |
|
Bullish |
|
3/11/2009 |
|
3/16/2009 |
|
3/19/2009 |
|
|
ACM |
21.17 |
24.00 |
13.37% |
24.81 |
17.19% |
25.04 |
18.28% |
|
AKAM |
16.36 |
17.71 |
8.25% |
17.59 |
7.52% |
19.09 |
16.69% |
|
BBY |
24.71 |
28.33 |
14.65% |
29.15 |
17.97% |
33.58 |
35.90% |
|
CA |
16.01 |
16.64 |
3.94% |
16.97 |
6.00% |
16.60 |
3.69% |
|
CEG |
15.5 |
16.25 |
4.84% |
18.03 |
16.32% |
19.63 |
26.65% |
|
CHKP |
21.04 |
20.72 |
-1.52% |
21.12 |
0.38% |
21.10 |
0.29% |
|
COST |
38.98 |
39.56 |
1.49% |
42.12 |
8.06% |
45.12 |
15.75% |
|
CTAS |
18.46 |
19.63 |
6.34% |
20.57 |
11.43% |
23.17 |
25.51% |
|
DO |
55.48 |
55.50 |
0.04% |
60.10 |
8.33% |
69.65 |
25.54% |
|
DRI |
24.86 |
26.79 |
7.76% |
28.78 |
15.77% |
34.94 |
40.55% |
|
FE |
37.54 |
37.19 |
-0.93% |
37.21 |
-0.88% |
38.64 |
2.93% |
|
FTI |
24.33 |
25.68 |
5.55% |
28.72 |
18.04% |
32.74 |
34.57% |
|
GOOG |
308.57 |
317.91 |
3.03% |
319.69 |
3.60% |
329.94 |
6.93% |
|
HNZ |
31.23 |
31.09 |
-0.45% |
33.13 |
6.09% |
32.99 |
5.62% |
|
HP |
20.3 |
22.37 |
10.20% |
22.74 |
12.02% |
24.59 |
21.13% |
|
IYF |
24.1 |
28.01 |
16.22% |
30.06 |
24.73% |
32.29 |
33.98% |
|
NDAQ |
19.29 |
23.57 |
22.19% |
21.07 |
9.23% |
21.11 |
9.43% |
|
OCR |
23.35 |
23.76 |
1.76% |
24.16 |
3.47% |
23.36 |
0.04% |
|
PSA |
48.83 |
54.36 |
11.33% |
52.82 |
8.17% |
55.69 |
14.05% |
|
REG |
22.02 |
27.00 |
22.62% |
25.98 |
17.98% |
28.81 |
30.84% |
|
SIAL |
32.67 |
33.74 |
3.28% |
34.24 |
4.81% |
36.28 |
11.05% |
|
SUN |
27.27 |
28.33 |
3.89% |
28.12 |
3.12% |
28.61 |
4.91% |
|
SWY |
17.53 |
18.39 |
4.91% |
19.54 |
11.47% |
19.65 |
12.09% |
|
TRV |
34.44 |
35.04 |
1.74% |
38.13 |
10.71% |
39.31 |
14.14% |
|
VLO |
16.24 |
17.07 |
5.11% |
17.92 |
10.34% |
19.43 |
19.64% |
|
WMI |
23.26 |
23.38 |
0.52% |
24.01 |
3.22% |
25.86 |
11.18% |
|
WRB |
19.47 |
19.76 |
1.50% |
20.51 |
5.34% |
22.70 |
16.59% |
|
XEL |
16.57 |
16.64 |
0.42% |
17.11 |
3.26% |
18.18 |
9.72% |
|
|
|
|
|
|
|
|
|
|
|
|
89.29% |
-0.97% |
96.43% |
-0.88% |
100% |
|
|
|
|
|
7.00% |
|
9.80% |
|
16.70% |
|
Bearish |
|