Stan Weinstein's Stage Analysis

This is a discussion on Stan Weinstein's Stage Analysis within the Technical Analysis forums, part of the Methods category; I bought back into Soybean Meal (SM) again today as it made another continuation move to new highs. The cumulative ...

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Old Aug 30, 2012, 7:40pm   #471
 
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Soybean Meal (SM)

isatrader started this thread I bought back into Soybean Meal (SM) again today as it made another continuation move to new highs. The cumulative volume and Mansfield RS continue to outperform, but I got out of this one too early back in July after getting in on a continuation move in early April. It was my best trade of the year so far, but I should have been more patient and waited for a Stage 3A exit point.

The recent consolidation has given me a chance to get back in with a reasonable stop loss distance below the 50 day MA, but it is a fair way above it's 30 week MA so it could easily reverse on me as it is quite extended. Although by historical standards it's been much more extended than it currently is multiple times in the past.

Attached is my charts.
Attached Thumbnails
sm_weekly_30_8_12-2.png  
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Old Aug 31, 2012, 1:29am   #472
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Re: Stan Weinstein's Stage Analysis

Thanks for the warm welcome guys-

After reading through about a third of this thread it has become painfully obvious that I need to up my software game. I am currently on Scottrader and while they do have some indicators (including weighted moving average), they are lacking on others that you all have mentioned (Mansfield cross and force index).

I am very new to the game and can't even put text onto a chart and embed it here (as I just tried on stockcharts).. Do you have a suggestion on what software I should use? Judging by lplate's comment above, I bet you have already discussed this but have not come across it yet in the thread. My apologies-

I was also wondering how you create a list of stocks or sectors (such as post #73 pg 10 of this thread) which include a search for performance vs index, rising MA and trading above the MA. Great info so far by the way. Naturally, I like to compare charts you have analyzed in the past to its current state and it seems like you are doing very well! I am really learning a lot and appreciate it!
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Old Aug 31, 2012, 5:31pm   #473
 
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Re: Stan Weinstein's Stage Analysis

isatrader started this thread
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Originally Posted by Locked in View Post
Thanks for the warm welcome guys-

After reading through about a third of this thread it has become painfully obvious that I need to up my software game. I am currently on Scottrader and while they do have some indicators (including weighted moving average), they are lacking on others that you all have mentioned (Mansfield cross and force index).

I am very new to the game and can't even put text onto a chart and embed it here (as I just tried on stockcharts).. Do you have a suggestion on what software I should use? Judging by lplate's comment above, I bet you have already discussed this but have not come across it yet in the thread. My apologies-

I was also wondering how you create a list of stocks or sectors (such as post #73 pg 10 of this thread) which include a search for performance vs index, rising MA and trading above the MA. Great info so far by the way. Naturally, I like to compare charts you have analyzed in the past to its current state and it seems like you are doing very well! I am really learning a lot and appreciate it!
For software you don't need anything other than the free software to begin with while you're learning. stockcharts.com, freestockcharts.com or chartmill.com will do the job as minimising trading costs is one of the most important lessons to learn.

Indicators etc are also largely unimportant. For Weinstein's method you just need a weekly chart with a 30 week moving average (a weighted MA is preferable imo, but not essential), volume and the Mansfield relative strength indicator (which is just a relative performance measure versus the S&P 500, that has a 52 week moving average as the base (zero) line. An example from stockcharts of the chart setup is below:

Click the image to open in full size.

Other indicators such as cumulative force index which you see on my main charts, are my personal custom tools to help me read what I'm seeing more clearly, but you don't need to use them and won't find them in any software programs as it's something I've adapted myself from Elders force index indicator to help me read the volume.

Finally to see a list of stocks by relative strength rankings you can use the free resources on chartmill here: ChartMill.Com | Screener for Stocks on Euronext, Amex, NYSE and Nasdaq Markets. or stockcharts technical rankings table here: StockCharts Technical Rankings - Free Charts - StockCharts.com
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Old Aug 31, 2012, 6:42pm   #474
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Re: Stan Weinstein's Stage Analysis

Thanks Isa- I tried a few out and chartmill seemed to be the best in my opinion. Anyway, I hope I have attached this chart of Las Vegas Sands (LVS) correctly. I wanted to analyze it for two reasons. First, my mother bought it about a year ago...road it up hoping/wishing that it would hit 80...she subsequently road it all the way back down to around the price she purchased it. Reason 2 is that it seems strange going from stage 2 to stage 3 and then back into stage 2 for a nice 20 dollar bump. In listening to one of the interviews with weinstein from last year, he said that this happens about 10% of the time.

I think, but I am not sure, this stock is still in a stage 4 decline despite the current correction. If you take the swing rule, the stock might head down to around 22 before consolidating. I only think this because of the recent support being broken and a lack of any conviction in the volume. Also, the 30 week MA is on the decline with the stock trading below it. RS seems bad as well. I've been telling my mother to sell for months now. Do you guys think my advice is correct?
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Old Aug 31, 2012, 8:05pm   #475
 
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Re: Stan Weinstein's Stage Analysis

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Originally Posted by Locked in View Post
Thanks Isa- I tried a few out and chartmill seemed to be the best in my opinion. Anyway, I hope I have attached this chart of Las Vegas Sands (LVS) correctly. I wanted to analyze it for two reasons. First, my mother bought it about a year ago...road it up hoping/wishing that it would hit 80...she subsequently road it all the way back down to around the price she purchased it. Reason 2 is that it seems strange going from stage 2 to stage 3 and then back into stage 2 for a nice 20 dollar bump. In listening to one of the interviews with weinstein from last year, he said that this happens about 10% of the time.

I think, but I am not sure, this stock is still in a stage 4 decline despite the current correction. If you take the swing rule, the stock might head down to around 22 before consolidating. I only think this because of the recent support being broken and a lack of any conviction in the volume. Also, the 30 week MA is on the decline with the stock trading below it. RS seems bad as well. I've been telling my mother to sell for months now. Do you guys think my advice is correct?
I've done a marked up chart of LVS for you of how I see it currently. It's been in Stage 4 since the last day of May / first day of June. However, on a longer term basis it's still within a much larger Stage 3 range that has built up over the last two years, with the exception of the failed Stage 2 continuation move at the start of the year.

On the P&F chart you'll see there's major resistance up to the 46 level, but the major breakdown point for a long term holder would be for it to start closing below 34.

On the daily chart I'd say that a move back below the short term trend line and the 50 day MA would be a good continuation sell signal imo if you were trading it.

Attached is my marked up charts
Attached Thumbnails
lvs_weekly_31_8_12.png   lvs_pnf_31_8_12.png  
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Old Aug 31, 2012, 8:08pm   #476
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Re: Stan Weinstein's Stage Analysis

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Originally Posted by Locked in View Post
. . . Las Vegas Sands (LVS) correctly. I wanted to analyze it for two reasons. First, my mother bought it about a year ago...rode it up hoping/wishing that it would hit 80...she subsequently road it all the way back down to around the price she purchased it. . . .
I think you know the answer to your question. Page 164.
I suppose you can make a case for holding it
Why I Doubled My Bet On Las Vegas Sands Recently - Seeking Alpha (though p/e 25 and even the Lazard target is only $48)
but it wouldn't be a Weinstein case.
This is really about managing a position, I think, and the complexity is, as you say, the fast turnaround at the top, so you almost have to switch to daily, where the answer looks pretty clear.
How much does it cost to deal in the States $10? It's nothing. If it was me, I'd get out and get into either something comfortable or something with a good set-up.
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Old Sep 1, 2012, 9:54am   #477
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Re: Stan Weinstein's Stage Analysis

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Originally Posted by isatrader View Post
For software you don't need anything other than the free software to begin with while you're learning. . . . For Weinstein's method you just need a weekly chart with a 30 week moving average (a weighted MA is preferable imo, but not essential), volume and the Mansfield relative strength indicator (which is just a relative performance measure versus the S&P 500, that has a 52 week moving average as the base (zero) line. . . .
I agree with isatrader. This issue arises because Weinstein's own subscription is so darned high.

As far as I can see, there is no proper free scanner code on the web, and all attempts end up trying to achieve the same outcome via a different means (new highs, increased volume, MA crosses, RSI etc). Where they fall down, I think, is that they cannot, without special code, computerise the shape of the stage 1, the style of the breakout and the position of the resistances. In practice, I think, you have to judge this by eye.
What in the end are you trying to produce? If you look for the 100% perfect Weinstein set up, you won’t find it – or maybe one or two per year.
You are therefore using a mental checklist of, say, a half-dozen essential features (for a buy: b/o, over 30 wwma, 30 wwma rising, ManRS rising, volume doubled, b/o was not lower down) and a half-dozen extra desirable but not essential features that you know from reading the book, and then in effect scoring each candidate in your head and selecting those with the essential features and the highest “score”.
What therefore I do is to nevetheless use some sort of free scan available which brings up a big field of candidates and then look at all it produces, chart by chart. I then check the best ones on 3yr wkly stockcharts and, if necessary, on 5yr wkly bigcharts. (You can use chartmill of course also.)
The downside from a professional scan is that it takes a while and I may miss some gems. I don't know, really, without seeing professional outcome and comparing it to mine. As you can see, I am usually days behind, and sometimes weeks behind, so that is another problem.
I would like to see the scan produced by S2O Pro as it is claimed Weinstein has publicised it as an easy shortcut to some of his stocks.

Don't forget this fine fellow, ShareHunter , who has had designed for him some software to bring up the buys in the major SPX, NAS100 and UK FTSE350 He charges per month approx $60 for the US A few years ago he used to offer his software for sale for a substantial but not overbearing amount. Maybe he still does.

PS have you read p3 of the thread, and also Charting software for Stan Weinstein's method - Aussie Stock Forums
subtitled: Isatrader holds his own against the prissy!
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Old Sep 1, 2012, 10:44am   #478
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Re: OXM BONT

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I bought back into Gold and Silver a few weeks ago . . . .
Very well done isatrader on Gold and Silver, after their big rise post Ben. Looks like you may be right too - and me wrong - on a bullish September.
Still take it easy, as the long weekend is ideal to relax the eyes. Glad it went well.

Volume has shrivelled, but I have actally noticed one or two candidates.

Best of the week I think , on good results clothes designer and marketer
OXM - Oxford Industries 3yr wkly - StockCharts.com $54.50 b/o $52.50 continuation from IHS stage 3.
We have noticed several stocks in this sector recently, e.g. SKX - Sketchers 3 yr wkly b/o $20 June

On reasonable results, BONT - Bon-Ton - 3yr wkly - StockCharts.com $10.50 b/o $9.70, but who wants a loss-making department store group except a sovereign state with more money than sense? This will be a good test of technicals versus fundamentals.

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Old Sep 1, 2012, 8:05pm   #479
 
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Re: OXM BONT

isatrader started this thread
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Originally Posted by lplate View Post
Very well done isatrader on Gold and Silver, after their big rise post Ben. Looks like you may be right too - and me wrong - on a bullish September.
Still take it easy, as the long weekend is ideal to relax the eyes. Glad it went well.

Volume has shrivelled, but I have actally noticed one or two candidates.

Best of the week I think , on good results clothes designer and marketer
OXM - Oxford Industries 3yr wkly - StockCharts.com $54.50 b/o $52.50 continuation from IHS stage 3.
We have noticed several stocks in this sector recently, e.g. SKX - Sketchers 3 yr wkly b/o $20 June

On reasonable results, BONT - Bon-Ton - 3yr wkly - StockCharts.com $10.50 b/o $9.70, but who wants a loss-making department store group except a sovereign state with more money than sense? This will be a good test of technicals versus fundamentals.
Another one in the same group you might not have seen, but is very close to another continuation after consolidating following a continuation move that had good volume in July and is the strongest long term in the US Clothing group is UA: UA - SharpCharts Workbench - StockCharts.com

Thanks on the Gold and Silver. I'm pleased with them so far, as Gold has made a 2.66% ATR(200) move and Silver has made a 3.65% ATR(200) move from where I bought in on the 14th Aug. Friday's closes for both metals gave trader continuation entry points imo, as I mentioned to watch for in my write ups on page 59 a few days back here: http://www.trade2win.com/boards/tech...ml#post1955206

P.S. I can't believe you found that thread on Aussie stock forums. It made me laugh reading it again as that guy really annoyed me. It's a sad state of affairs that you have to justify yourself for being helpful these days.
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Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill – Reminiscences of a Stock Operator.

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Old Sep 2, 2012, 10:35pm   #480
 
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S&P 500 Momentum

isatrader started this thread It's been a while since I updated the momentum charts, but it's shows a mixed picture currently with the Momentum Index (which is the 200 day moving average of the NYSE advance decline figures; pages 283-287 in the book) trading sideways during this recent price run-up.

My personal momentum indicator (blue chart) which measures the speed of the 30 week weighted moving average went back onto a buy signal on 27th July on the weekly chart, but the daily shorter term momentum went to a sell on the 22nd August, so again a mixed picture.

Finally, the Distance from the 30 week WMA is still in the Bull Neutral zone between 0% and 5% and needs to move above 5% again to go back to Bull Confirmed status imo.

The major breadth indicators that I follow in my other thread here: http://www.trade2win.com/boards/tech...ml#post1957524 are more positive though, so with the mixed picture on the Momentum index and bullish tone on the major breadth indicators and the fact that we have yet to break out of Stage 3 means I'm leaning towards being cautiously bullish at the moment personally. But I'll change that view if the breadth starts breaking down and price starts closing below the 50 day MA and can't recover back above it.
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Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill – Reminiscences of a Stock Operator.

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