Thread by @BullsforBears

Mark Minervini
Specific entry point analysis & superperformance
Basic criteria :-
Most superperformers occurred with stock in a definite uptrend,improving earnings,revenue,margins,definite catalyst in place
Most superperformers give atleast 1,sometimes multiple entry points

Many superperformers may not workout or result in gains,stoploss is critical

If trend is in place check fundamentals ,look for a catalyst ie..drug approval by USFDA,appointment of a new CEO,identify entry and exit points
@markminervini @jackschwager
@dow #stocks #markets

Most superperformers(SPs) occur when a stock is young 1st 10 years post IPO
Many companies have high growth phase when they are small ,nimble and low market cap
Occasionally large caps may see huge price surge after a turnaround or post prolonged bear market
@Coolfundoo #nse

Best growth stocks have PE of 30 to 40 before their largest advance
What's most imp is earnings growth
Companies with rapid earnings growth are the best

TREND IS YOUR FRIEND
Never trade a stock moving below its 200 DMA

Stock price maturation- 4 stages

Stage 1 - phase of neglect ,consolidation
Few biggies are looking at the stock,stock earnings are lackluster,uncertain outlook stage may last for months to years
AVOID BUYING IN STAGE 1
Stock will hover near its 200dma,no definite trend

Stage 2 Advancing phase,accumulation

Begins with little or no warning,no news
Proper stage 2 will have significant volumes ,strong demand on big updays & weeks,light Vols during down days
Rally should have started ,stock rallied 25 to 30% from its lows before yu decide stage 2

Criteria for stage 2
Stock price above 150 & 200 DMA,
150 above 200 DMA,
200 DMA is turned up ,series of higher highs and lows ,large up weeks on volume spikes & contrast with low volume pullbacks,more upweeks in volume than down weeks, 50 DMA is above 150
@porinju
@awealthofcs

Stage 3 - Topping phase distribution

Some point earnings growth may slowdown by a small %age ,more high volume pullbacks & high volatility, stock changing hands from strong to weak hands
Volatility spikes ,major drawdown with high vols since start of stage 2
@varinder_bansal

Price breaks on high volumes
Stock may move below its 200 DMA,stocks in stage 3 move above and below 200 DMA before topping out
200 DMA will lose upside momentum,flatten out and turn downward in phase 3

@darshanvmehta1 @AnilSinghvi_ @_nirajshah @_anujsinghal

Stage 4 - Declining phase ,Capitulation phase

Company will lose EPS momentum,earnings slowdown, increase in inventory signaling decrease in demand,earning downgrades,more selling pressure for long periods, stock enters period of neglect

@markminervini @BillAckman

Stage 4 opposite of stage 2
Majority of price action below 200DMA
200 DMA in definite downtrend,turned downwards, short term moving averages are below long term averages, volume spikes on down days contrast to low volumes on updays ,more downdays & weeks with large volumes

Identify stage 2
Stock price above 150 & 200 DMA
200 DMA line trending up for atleast 1 month,preferably 4 to 5 months
50DMA above 150 & 200
Current price atleast 30% above 52 week low best 100% ,200% above 52 wk low
CMP within 25% of 5w week high
RSI above 70 preferably 80 90

Stage 2 stock forms 3 to 4 bases,
Base 1 or 2 comeoff a market correction , best time to get onboarding
You want to enter with the institutional money
When a stock shows signs of topping out or enters stage 4, TRUST WHAT YOU SEE NOT WHAT YOU HEAR on the TV
@markminervini #stocks

Groups that have produced the maximum Superperformers
Consumer goods
Technology, computers ,software
Drugs,Medical,Biotech,
leisure &entertainment
@ITCCorpCom @HUL_News @LaurusLabs @NeulandLabs @reliancejio @TCS @Infosys @INOXMovies

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