As The Fly discussed a few nights ago, The PPT is extremely beneficial in many respects, especially with how you are able to streamline the research required to be properly prepared for the upcoming trading session. You are able to create–and save–your own customized “screens.” Thus, the stocks change, but the parameters of what you are looking for do not. Hence, you are working smarter.
As an example, I created and saved a screen focused on attacking stocks with numerous shorts who may be on the verge of getting violently squeezed. In the current market, we know that the S&P 500 broke through 1300 today, and it is likely quite a few bears were pressing for a rejection from that level. Thus, it is logical to look for short squeeze plays. Instead of sifting through all types of data, I can simply go to “My Screens” in The PPT, and come up with tonight’s readings for my custom short squeeze screen. Note the parameters: Bullish volume and technical scores by The PPT algo, heavy short positions, an idea of the size of the float, and proximity to the 20 day simple moving average to avoid chasing names that have already made their move.
Let’s suppose that we have no short squeezes over the next few days, and the market takes a turn for the worse as we plunge below 1300. Even if that happens, understand that you were still exquisitely prepared for the opposite scenario. While we cannot control the day to day moves in the market, we can most certainly take a proactive approach in knowing how to efficiently adjust regardless.
When looking at the charts of some of the names on tonight’s readings, it should be obvious that, just from this feature alone, The PPT is an incredible, value-added algorithm.
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Chess,
Thanks for posting, it appears to be a very handy tool in which to make short-term directional bets.
Question about the data you’re using in the example above.
I noticed that FINVIZ shows NFLX at 20% shares float, meanwhile Yahoo Finance says its 30% as of Feb 28th 2011 (same as the PPT screen above)….do you worry about basing trades on data that, after a 700 pt rise, could be significantly different now?
Thanks.
I see your points. I think the important factor is that these names are still heavily shorted, even if there is some discrepancy about the exact %. Big picture perspective is in order.
Finviz.com short data is not very reliable in my opinion. I always cross-check with another source and
like Schaeffer, e.g. http://www.schaeffersresearch.com/streetools/filters/equity_si.aspx?TICKER=MNI.
When it comes to short squeezes I also like to look at current price distance to 52w high. After all, there should be some very nervous shorts sitting on a loss when a highly shorted stock is close to a 52w high…
I would recommend doing a little more research than just the factors of the PPT. I like ATHN but you have to wonder when the CEO alone has sold almost 100,000 shares so far in 2011. Insiders own less than 2% of the company which isn’t much considering the company just went public in 2007. I get the premise but there are additional factors to consider.
Disagree. Maybe for an investment–not for a trade
thanks chess.its mind boggling at times.because the combinations you can screen for are pretty much infinity.for me when i break it down to specifics it gets easy to narrow down a choice. trying to become in sync more or less with a new ton of tools,while maintaining your trading style.like how long you can push an issue before you notice when you really have to exit stage left.