Saturday, October 2, 2010

One of my best ideas!

I found this stock while I was screening for 4%+ break outs on Friday. This is one of the best ideas I have found since I have started trading in terms of the fundamental and technical criteria I search for.

Here goes:

1) Is the stock basing or near to a base? (yes, this stock broke out two days ago from a nine month base on the highest daily and weekly volume for the past three years!);

2) Did the stock have an EP in the past quarter? (yes, it closed up 31.48% on 35.86 times average 50 day volume after reporting 100%+ out earnings and revenue growth);

3) Is the 6 month relative strength greater than 90? (yes, it is 91);

4) Was the revenue growth greater than 25% in the latest quarter? (yes, about 200%);

5) Was the earnings growth greater than 40% in the latest quarter? (yes, but previous quarter had negative growth);

6) Is the earnings estimate for the next quarter greater than 40%? (not available, no analyst coverage);

7) What is the number of analyst covering this stock? (zero!!!);

8) Is this stock's float less than 25 million? (yes, 2.32 Mil!);

9) Is the stock's market cap less than 2 Bil? (yes, 16.78Mil);

10) Does it have a high percent short float? (no, 0.10%).

This stock has scored a 9 on my 10 point techno-fundamental check list. This is as good as it gets in terms of a stock that has a high probability of rising significantly over the next few weeks to months. In addition, this stock is a Chinese stock which have been on fire of late.

Should the overall markets continue to rise there is certainly a very good long idea based on the factors outlined above and certainly deserves a spot in any watch list. Will be looking for a low volume bull flag, pennant or pull back of some sort to get long this stock.

Good luck and good trading!

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