Last week I released the Morales & Kacher trading template for the EdgeClub. This template scans the market daily for Pocket Pivots, Buyable Gap-Ups and Seven Week Rule signals.
In this post I will review the overall market behavior for the week in the S&P500 and take a look at all the buyable gap up signals that were generated in that list (there were 7 in total).
S&P 500 action
From the above chart we can see that the SPY (a proxy for the S&P500) rose 1.65% between the close on Monday and the close on Friday.
Components of the S&P500 with Buyable gap-up signals
Now let’s take a look at the buyable gap-up signals that were generated from components of the S&P 500 throughout the week. The following table shows hypothetical trades that were entered at the close on the buyable gap-up day and exited (just for example’s sake) at the close on Friday.
| Entry Date | En. Price | Sym. | Exit Date | Ex. Price | Days | PL % | MFE % | MAE % |
|---|---|---|---|---|---|---|---|---|
| 3/4/2013 | 68.84 | HES | 3/8/2013 | 69.47 | 5 | 0.92% | 2.40% | 0.06% |
| 3/5/2013 | 9.39 | GNW | 3/8/2013 | 9.84 | 4 | 4.79% | 6.92% | 0.00% |
| 3/6/2013 | 32.84 | FCX | 3/8/2013 | 33.28 | 3 | 1.34% | 1.98% | 0.37% |
| 3/6/2013 | 18.75 | BBY | 3/8/2013 | 20.17 | 3 | 7.57% | 9.92% | 1.01% |
| 3/7/2013 | 56.78 | TWX | 3/8/2013 | 57.46 | 2 | 1.20% | 1.88% | 0.19% |
| 3/7/2013 | 30.25 | KR | 3/8/2013 | 31.17 | 2 | 3.04% | 3.14% | 0.13% |
| 3/7/2013 | 15.23 | JDSU | 3/8/2013 | 15.48 | 2 | 1.64% | 1.84% | 0.46% |
HES – Buyable Gap Up – Held 5 Days: 0.92% Gain
GNW – Buyable Gap Up – Held 4 Days: 4.79% Gain
FCX – Buyable Gap Up – Held 3 Days: 1.34% Gain
BBY – Buyable Gap Up – Held 3 Days: 7.57% Gain
TWX – Buyable Gap Up – Held 2 Days: 1.2% Gain
KR – Buyable Gap Up – Held 2 Days: 3.04% Gain
JDSU – Buyable Gap Up – Held 2 Days: 1.64% Gain
Summary
For the week of March 4th – 8th, the buyable gap up signals in the components of the S&P 500 averaged a gain of 2.93% compared to the SPY gain of 1.65%. During a stellar week for the overall market, these signals outperformed even the overall market indexes. These signals will be worth watching during the coming weeks and months and they add another arrow to your trading quiver.
The Buyable gap-up signals are introduced and discussed in the Morales & Kacher books ‘Trade Like an O’Neil Disciple: How We Made 18,000% In the Stock Market’ and ‘In The Trading Cockpit with the O’Neil Disciples: Strategies that Made us 18,000% In the Stock Market’.
The signals given by the EdgeClub software are ‘raw’ signals which allow the user to quickly scan through the charts to determine if the stocks meet their other trading criteria such as might be gleaned from reading the Morales & Kacher books.
Here’s an example of how these signals appear in the EdgeClub software everyday:
How the Buyable Gap Up signals appear in the EdgeClub software everyday