TRADING ROUTINE - CHECKLIST - Investor's Business Daily
TRADING ROUTINE - CHECKLIST
Type of Base
General Market
Pass
Fail
Base Characteristics
Cup-with-Handle
Flat Base
Is the current market in an uptrend?
How much is the prior uptrend?
Cup-without-Handle
Square Box
How many distribution days on the NASDAQ?
Which stage base is it?
Saucer-with-Handle
High Tight Flag
How many distribution days on the S&P 500?
What is the character of prior action and bases?
Saucer-without-Handle
Ascending Base
How many distribution days on the Dow?
What is the current character of the stock?
Double Bottom
Shakeout + $3
Fundamentals
Are the depth and length within normal ranges?
EPS Rating (>80)
If base-on-base, is it sitting above prior base?
Base Specific Characteristics
Quarterly EPS Growth (>25%)
Is the overall pattern classic and sound?
Cups and Saucers
Double Bottom
Quarterly Estimates (>25%)
Is too much of the base in the lower half of the pattern?
Depth of base (%)
Depth of base (%)
Average EPS % change for last 3 quarters (>25%)
Is there a historical precedent stock?
Length of base (weeks)
Length of base (weeks)
Last quarter % earnings surprise (>0%)
Did volume dry up in handle or around base low?
Length (left side)
2nd bottom under cut? (%)
EPS Estimates revised higher
How many blue weeks (up on above average volume)?
3-Year EPS Growth Rate (>25%)
How many red weeks (down on above average volume)?
Length (right side)
Length (handle)
Depth % (handle)
Flat Base and Square Box
Depth of base (%)
3-Year EPS Stability (< 29)
3+ years of EPS increases
How many supporting weeks (down on above avg vol w/ closing range of +40%)?
Are there any big volume key support areas?
Is handle in the upper half?
Length of base (weeks)
Annual EPS estimates (>25%)
Is the overall structure tight?
Is handle drifting down?
SMR? Rating (>C)
How many weeks have a wide spread?
Shape (U or V)
Quarterly Sales (>25%)
How many tight weeks are in the base?
Average Sales % change for last 3 quarters (>25%)
Is there a shakeout within the base?
Ascending Base
High Tight Flag
ROE (>17% )
Is there too much distribution on the left side of the base?
Length of base (weeks)
Flagpole length (weeks)
Pretax Margin
Is left downside of base more than 1 week?
1st pullback depth %
Flagpole percent gain
Quarterly EPS acceleration
Is left downside of base disproportional to right upward side?
2nd pullback depth %
Flag length (weeks)
Quarterly sales acceleration
Maximum number of weeks up in a row within the base?
3rd pullback depth %
Flag depth %
Quarterly Margins near peak
Is the RS line near new highs?
Sponsorship
Is handle wedging up along weekly lows without pullback or shake out?
Price (>$15 NASDAQ; >$20 NYSE)
Is it straight up from the bottom to new highs without pullbacks?
Volume (>400,000 )
Does the daily chart show signs of accumulation?
Shakeout + $3
One or more top quality sponsor owns?
If bottom day is an upside reversal, was it on the largest volume in the base?
Prior low in base
Number of funds increasing or accelerating
Have there been excessive stock splits?
How many days was the shakeout?
Price Movement
What percent did it fall below prior low?
RS Rating (>80)
Are you buying on news, split or publicity?
Is the stock too obvious to everyone?
Accumulation/Distribution (ACC/DIS RTG?) Rating (>C)
Are you already too concentrated in this group?
Within 15% of 52-week high
When are EPS due?
Is 12-month Tax selling due?
Did each pullback hold above prior
pullback¡¯s low?
Pivot Information
If Stock is at Standard Pivot
If Stock is at Secondary Buy point
Up/Down Volume (>1.0)
Current price
Current price
Group Rank (Top 40)
Pivot Data (only if stock is past pivot)
Pivot price
Secondary buy point price
Is there at least one other leader in the same industry group?
Volume percent change on pivot day
Current price vs. pivot %
Current price vs. buy point %
Misc.
Percent price gain on pivot day
Target (Pivot plus 20%)
Is this the #1 or #2 in its industry group?
Was there clear overwhelming demand at the pivot?
IPO in last 15 Years
Was weekly volume higher than prior week¡¯s volume?
Did stock run up 20% or more within 3 weeks?
Current Position of Stock
At pivot (within 5%)
3-Weeks tight
Still in base
Pullback to 50-day (1st, 2nd, etc)
Pullback to pivot area
Pullback to pivot area (1st, 2nd, etc)
Pass
Price Objective
Realistic price objective?
Percent gain from current price to price objective?
What is the definite sell price?
Extended from pivot
Summary
Rate the stock overall (A+ to C)
Concept of company:
Date _________
Symbol_________________
Company_______________________________________
Copyright ?2011 Investor¡¯s Business Daily, Inc. Investor¡¯s Business Daily, IBD, CAN SLIM and corresponding logos are registered trademarks owned by Investor¡¯s Business Daily, Inc. MarketSmith is a registered trademark of MarketSmith, Incorporated. This document is for your personal, non-commercial use only. No part of this work may be reproduced,
redistributed, published, stored in a retrieval system, or transmitted in any form or by any means, electronic mechanical, photocopying, recording, or otherwise, without prior written permission of Investor¡¯s Business Daily, Inc.
Fail
TRADING ROUTINE - CHECKLIST
MarketSmith? Screener - Checklist Parameters
Category
Screen Element
1: SmartSelect ? Ratings
EPS Rating
RS Rating
SMR? Rating
ACC/DIS RTG?
>80
>80
A, B or C
A, B or C
2: Earnings
% Change in Latest Quarter¡¯s EPS vs. Same Quarter Prior Year
% Change in Fiscal Year EPS vs. Prior Year, 1 Year Ago
¡Ý25% (check box)
¡Ý1%
¡Ý1%
% Increase in Next Quarter¡¯s EPS Estimate From Same Quarter
Prior Year Actual EPS
¡Ý25%
% Increase in Current Annual EPS Estimate vs. Last Reported
Annual EPS
¡Ý25%
EPS Have Been Accelerating Over the Last 3 Quarters (%)
Yes
Annual % EPS Growth Rate of Last 3 Years
Average EPS % Change for Last 3 Quarters
¡Ý25%
¡Ý25%
Last Quarter % Earnings Surprise
¡Ý0
% Change in Latest Quarter¡¯s Sales vs. Same Quarter Prior Year
¡Ý25%
Sales Have Been Accelerating Over The Last 3 Quarters (%)
Yes
4: Industry & Sector
Company¡¯s Industry Group Rank
1 > 40
6: Price & Volume
Current Price
>$15
Current Price in Relation to 52-week high
>-15%
Yes
% Change in Fiscal Year EPS vs. Prior Year, Last Reported Year
3: Sales
RS Line Making New High
Criteria
Up/Down Volume Ratio
¡Ý400,000
¡Ý1
7: Margins & Ratios
ROE
>17%
8: General Stock Criteria
IPO Date (15 years)
1995
Current 50-Day Average Volume
? 2011 Investor¡¯s Business Daily, Inc.
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