[isatrader]

I just came across this stock and I think it's potential winner:

1- Price just went above SMA
2- Impressive volume
3- RS just moved into positive territory

I know there's a lot of overhead resistance but the Stage 1 is extended over 8-9 months which leads me to believe that the resistance is not as significant. I'm wondering what other more experienced people think about it on a scale of 1 to 10.

Thanks

Although it's made a big move of the low. It would be considered too early in the method, as the Stage 4 decline was extreme and over a long period. So the resistance will be very heavy for a long time. Also the heaviest volume spikes were actually selling volume by the looks of the weekly candles. As they gave up over 90% of the candles and closed near the lows.

See the Chapter in the book about the Less the Resistance the better.

   

Also, what about this stock. Same thing:

1- Price just went above SMA
2- Impressive volume
3- RS just went above 0

On a scale of 1 to 10?

Thanks

This suffers from a similar problem. As it has a big area of resistance above the current level. So would be considered too early in the method.

Try to focus on stocks that are making at least 6 months highs on their breakouts, ideally 52 week highs or more, with little visible resistance on the chart and a decent base pattern, instead of bottom fishing. As Weinstein's method is about buying high and selling higher.

I hope that helps.