StockFetcher Forums · General Discussion · 50% Rule<< 1 2 >>Post Follow-up
glgene
523 posts
msg #49412
Ignore glgene
1/20/2007 2:07:23 PM

The 1/22/07 issue of Investor's Business Daily (pg. B2) includes this tidbit:

"When a stock is near 50% above it's 50-day MA, it's likely ripe for a pullback."

It cites this example. On 1/16/07 AXR (Amrep) closed at $146.33. It's 50-day MA was $101.38, which is 44% above price. Three days later (1/19/07) its price closed at $136.35, a drop of 7%. Its 50-day MA is now $105.88, which is now just 29% above its 50-day MA.

Question: How would you build a SF script to filter for this near 50% rule?
Thanks in advance to anyone who replies.


lockwhiz
206 posts
msg #49418
Ignore lockwhiz
1/20/2007 2:59:58 PM

Fetcher[
set{Abv50MA,ma(50) *1.5}
price is greater then Abv50MA
and draw ma(50)
]




lockwhiz
206 posts
msg #49419
Ignore lockwhiz
modified
1/20/2007 3:16:25 PM

...interesting ...but many keep going higher.
Same filter with a 5 day offset :

Fetcher[
set{Abv50MA,ma(50) *1.5}
price is greater then Abv50MA
and draw ma(50)
and offset 5 days
]




- or to see your AXR -

Fetcher[
set{Abv50MA,ma(50) *1.44}
price is greater then Abv50MA
and draw ma(50)
and sort column 1 ascending
and offset 1/16/07
]





glgene
523 posts
msg #49423
Ignore glgene
1/21/2007 12:14:34 AM

Lockwhiz,

Need to add a column that, in the AXR example, it would show 44 (meaning close is 44% above ma(50). Then, I would sort on that column to show the extremes (such as FRPT, which I have owned 4 times [3 wins, 1 loss].

I tried a set command, and it didn't work. Need help with the %Diff column (44 in AXR case). Thanks.

Remember, the IBD article says "most of the time" re: 50% As you can see with FRPT, it's much higher than 50. Ripe for a fall? FRPT is waiting to earn a new, big contract. If it doesn't get it, I suspect the stock will fall big. But I could be wrong.


TheRumpledOne
6,358 posts
msg #49426
Ignore TheRumpledOne
1/21/2007 10:12:19 AM

Fetcher[

set{PPDiff, CLOSE minus ma(50) }
set{PPDiv, PPDiff / ma(50)}
set{BallOnx, PPDiv * 100}
set{BallOn, round(BallOnx,0)}

set{Abv50MA,ma(50) *1.5}

close above Abv50MA

add column Ballon

and draw ma(50)

sort column 5 descending
]



The BallOn column is the pct above/below the ma(50)


lockwhiz
206 posts
msg #49427
Ignore lockwhiz
1/21/2007 10:29:34 AM

Here you go ...

Fetcher[
set{Abv50MA,ma(50) *1.44}
set{x,price/ma(50)}
set{y,x-1}
set{%Diff,y*100}
price is greater then Abv50MA
add column %Diff
and sort column 6 ascending
and draw ma(50)

and offset 3 days
/* change the offset to 0 days for current screen */
]




... obviously the first line uses 1.44, so to catch the infamous AVX, but you can loosen or tighten to what ever floats your boat.
I would add in other criteria to weed out those lame ducks that don't have very much volume... and or price ... but thats your call ... its your screen.

Playing with the offset, ( and looking at performance) you can get an idea of how effective it would be to trade by ... further screening is warranted. Also, when using the offset, it may show a gain (a loss since you are shorting), but you need to look at the chart to really see how it performed....

enjoy


lockwhiz
206 posts
msg #49428
Ignore lockwhiz
1/21/2007 10:38:02 AM

FRPT ... given what you said, you have a 50/50 chance whether they get the contract or not ... so you will either win big ... or lose big.... I'll watch it ... and hope it goes your way.


glgene
523 posts
msg #49429
Ignore glgene
1/21/2007 10:40:21 AM

TRO,

As usual, you come thru with flying colors! I added a column ma(50) in front of your ballon column for easy reference.

What other indicators would you add as columns for confirmation of the 50% signal? As IBD says, the rule is just a guide. Maybe a Stochastics column or other momentum oscillator?


glgene
523 posts
msg #49430
Ignore glgene
1/21/2007 10:44:30 AM

Lockwhiz,

Another great answer! I hope to some day be able to write SF script the way you, TRO and other pros here do. You experts amaze me!

As I asked TRO, what other columns would you add to designate other underlying indicators?


glgene
523 posts
msg #49431
Ignore glgene
1/21/2007 10:52:35 AM

lockwhiz,

Re: FRPT. I am currently out. Sold off last week when it tumbled 20% right before 3:30 (I did profit) --- and naturally it came back after I sold. It happened on 1/18/07, the day FRPT came alive on the NAZ. Is it common for NAZ newcomers to take a hit the first day? Sounds like smart money knew what it was doing, and me? I was the dumb money. That said, I did capture 3 wins out of 4 FRPT round-trips. I can live with that. FRPT increased nearly 2700% last year; the 4th largest gainer in the Vector Vest database. I know someone who bought FRPT at 83 cents. I started looking at FRPT when it was 76 cents, but its financials were so lousy that I said "no way." Boy, was I wrong!


StockFetcher Forums · General Discussion · 50% Rule<< 1 2 >>Post Follow-up

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