 Gold Customer
Joined: 2/9/2005
Posts: 11
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I've watched all the videos on creating PCF's, but I'm still unable to create one that gives me the results I'm looking for. Can anyone please help with suggestions?
I'm looking for stocks whose moving averages and prices have generally
been flat (not ascending or descending -- basically "flat-lining") for the past 3 years or so with little weekly volume change. Of those that qualify for this condition I'd like to select for stocks that have recently surged up in price against their long-term moving average (65 da. MA) on high volume
(at least 4 times greater than the past 4 weekly averages) and preferably
with the Wilder RSI crossing above 50% simultaneously.
Thanks in advance for anyone willing to offer help.
Longterm Investor
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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A few questions:
How flat is flat? How do you want to measure their flatness for three years?
How long ago can the "surge in price" start (breaking the flat pattern)?
What Wilder RSI settings are you using?
- Craig
Here to Help!
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Gold Customer
Joined: 2/9/2005
Posts: 11
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Thanks, Craig, for responding. "Flat" needn't be absolutely flat, just a trading range in price over a relatively long period of time so that the long term MA is generally a horizontal line. This would indicate little interest in the stock among traders and investors for some time (1, 2 or 3 years). Low volatility in price, MA and volume for an extended period until *BAM*, something happens to take price and volume up sharply and steadily over a few days or weeks.
I haven't selected Wilder RSI settings, but am open to suggestions on that. Basically, it would be nice for RSI to cross up over the S&P500 comparison line coincident with the incident looked for above.
- LongTerm
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Gold Customer
Joined: 2/9/2005
Posts: 11
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Perhaps an example of what I'm looking for is in order, since
a "picture is worth 1000 words." Please take a look at
Vertex Pharmaceuticals (VRTX) on a 3 day chart for the
period 2004 - 2005. It was basically flat until May of '05 when the price surged on higher volume. I bought it at
$13 and was able to ride it to $40.
LongTerm
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Registered User
Joined: 1/28/2005
Posts: 6,049
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longterm
You may be interested in this:
Scan for stocks bouncing in a lateral channel
Thanks
diceman
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Gold Customer
Joined: 2/9/2005
Posts: 11
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Thanks, diceman! I was not aware of that video. Interesting that it ended with a display of VRTX as a consolidating
candidate just before it took off 3 months later.
longterm
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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I have a better idea on the "flat" issue but still need to know the following:
QUOTE (me) How long ago can the "surge in price" start (breaking the flat pattern)?
What Wilder RSI settings are you using?
Are you trying to catch these before or after the surge and RSI crossover?
- Craig
Here to Help!
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Gold Customer
Joined: 2/9/2005
Posts: 11
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Thanks for posting again, Craig. Let's forget the
Wilder RSI issue entirely for now for sake of simplicity:
I have yet to fine tune the settings. That aside, I would
like the surge in price to have occured within the last
several days at most, let's say starting from a minimum
of 3 to a maximum of 7 trading days. This should
allow enough time to make sure it's truly the
start of a new trend upwards rather than a head-fake.
Rising volume on the breakout would be the
primary confirmation. Once I work out the
Wilder RSI parameters (on my own), I would use it as
further (secondary) confirmation.
Thanks for all your efforts,
- longterm
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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We are almost there...
We need to define the move over the last 3 days. How do we know this is a "surge in price"? Does it move a certain percentage? Does it make a new 1-year high (breaking the flat move of the previous 250 trading days)?
How are we going to measure this surge so we know it is a surge?
- Craig
Here to Help!
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Gold Customer
Joined: 2/9/2005
Posts: 11
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Thanks again, Craig, for asking the pertinent follow-up questions. The price surge isn't measured by a percentage move or new high. Instead, using a 6-day chart, it would be characterized by the price breaking above the 65-bar moving average line on high volume (at least 4 times greater than the volume of the past 4 weeks) and sustaining that move upwards over the next several (3 to 7) trading days. Volume should also be sustained at a high level, though not necessarily as high as the initial breakout. Any pullbacks or retracements in price should end with a low at or higher than the 65-bar moving average before continuing up again. Price should "pull up" the moving average along with it but remain above it (except for the retracements mentioned above which should end at or above the 65-day MA). Again, you may wish to reflect on the movement of VRTX in 2004-2005 as a good example of what I'm trying to scan for.
Thanks very much for all your efforts,
- longterm
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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Try this for me:
Create the following PCFs:
Trend/Consolidate 1-year
100*(MAXH250-MINL250)/(AVGH250-AVGL250)
Recent crossing 65sma on 6-day chart
C> (C+ C6+ C12+ C18+ C24+ C30+ C36+ C42+ C48+ C54+
C60+ C66+ C72+ C78+ C84+ C90+ C96+ C102+ C108+ C114+
C120+ C126+ C132+ C138+ C144+ C150+ C156+ C162+ C168+ C174+
C180+ C186+ C192+ C198+ C204+ C210+ C216+ C222+ C228+ C234+
C240+ C246+ C252+ C258+ C264+ C270+ C276+ C282+ C288+ C294+
C300+ C306+ C312+ C318+ C324+ C330+ C336+ C342+ C358+ C364+
C370+ C376+ C382+ C388+ C394)/65 AND
C6< (C6+ C12+ C18+ C24+ C30+ C36+ C42+ C48+ C54+
C60+ C66+ C72+ C78+ C84+ C90+ C96+ C102+ C108+ C114+
C120+ C126+ C132+ C138+ C144+ C150+ C156+ C162+ C168+ C174+
C180+ C186+ C192+ C198+ C204+ C210+ C216+ C222+ C228+ C234+
C240+ C246+ C252+ C258+ C264+ C270+ C276+ C282+ C288+ C294+
C300+ C306+ C312+ C318+ C324+ C330+ C336+ C342+ C358+ C364+
C370+ C376+ C382+ C388+ C394+C400)/65
4-week Volume Surge
V>AVGV20*4
Once you create and calculate the above PCFs, please build the following EasyScan
WatchList (ALL STOCKS)
Price Per Share (limit based on your trading)
Volume 90-day (limit based on your trading)
Volume Surge 5-day (limit VALUES: 100 to MAX)
Price Percent Change 5-day (limit VALUES: 0 to MAX)
4-week Volume Surge (no limit needed)
Crossing 65sma on 6-day chart (no limit needed)
Save your EasyScan and enjoy the resulting WatchList of stocks that fit your conditions.
Sort the results in ASCENDING order by the PCF: Trend/Consolidate 1-year. It will bring the ones that consolidated the tightest to the top of the list.
Here are three videos to review:
How to create a Personal Criteria Forumula (PCF)
Using EasyScan to find stocks that meet your own criteria
Create your own stock rankings using WatchLists and Sort conditions
I just ran this scan and found 7 stocks. (you may find more or less depending on how you limit your price and volume conditions.)
These 7 were ranked by the Trend/Consolidate condition.
Interesting of them:
VMSI
JOB
AFN
Let me know if you want to tweak this further. The volume surge condition is the biggest limiting factor here. You will get more stocks if you get less restrictive than 4x the average volume.
- Craig
Here to Help!
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Gold Customer
Joined: 2/9/2005
Posts: 11
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Thanks, Craig! You've obviously put a lot of thought and
energy into your response. I'm going to try your suggestions
throughout the day and will provide feedback later. If I
come up with Wilder RSI parameters that complement this
search, I will let you know.
Thanks again and enjoy your talks in Las Vegas this weekend!
- longterm
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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I don't see a need to add the Wilder portion. You are already only getting a small handful of stocks.
Let me know if you need anymore help.
- Craig
Here to Help!
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Gold Customer
Joined: 2/9/2005
Posts: 11
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After working with the suggestions above for the
past few weeks, I changed the PCF for
"4-week volume surge" to
AVGV6 > (AVGV20 * 2)
which is less restrictive than the prior formula
and more in line with what I normally look for
visually on a 6-day chart.
- longterm
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Worden Trainer
Joined: 10/7/2004
Posts: 65,138
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I'm happy to read you were able to adapt it to find what you normally look for visually.
-Bruce
Personal Criteria Formulas
TC2000 Support Articles
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Registered User
Joined: 1/1/2005
Posts: 2,645
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QUOTE (longterm) ...
AVGV6 > (AVGV20 * 2)
which is ... more in line with what I normally look for
visually on a 6-day chart.
longterm,
The average volume AVGV20 cannot be observed on a 6-day chart. If you would like to use an average volume which can be observed on the 6-day chart, change the AVGV20 to AVGV18 or AVGV24.
Thanks.
Jim Murphy
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Gold Customer
Joined: 2/9/2005
Posts: 11
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Thanks for the observation, Jim. You're right, of course.
AVGV24 makes more sense.
-longterm
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