A Trade A Day

One way to find good trades is with Industry groups. Using my personal methodology I look for Industry groups that are moving and then select the individual stocks within that group that are forming tradeable patterns. William O’Neil’s CANSLIM method is a popular methodology that uses this strategy.

Let me give you a specific example. Last week, I posted a potential trade in FCX. Let’s breakdown where this trade came from.

The first thing I did was find an industry group that was moving up. I think the market is in an uptrend so I wanted to find industry groups that were moving in sync with the market. There are alot of resources out there that you can use to find Industry groups and the stocks that they represent. I like free so I was using the industry screener on www.marketwatch.com. Please note that these screen shots are as of Sunday 9/16 and not from Tuesday 9/11 when I posted thee FCX trade.

Looking at the industry screener for 1 month performance, we see that the DJ US Nonferrous Metals Index has done the best.

My next step is to click on an industry which gives me a list of the 10 best and 10 worst stocks in the industry. But what I’ve really found useful is the Industry analyzer. This link will take you to the industry analyzer for the DJ US Nonferrous metals index. I’ve sorted it for the best performing stocks in this industry for a one month period. I like this view because I get 9 charts at a time that I can quickly scan. When I find a stock I like. I plug the symbol into an esignal chart for a better look.

There are many stock screeners out there and this one has its limitations. But it is a cheap and its easy. Most importantly its made me money.

BTW, I like PCU, ROY, and SLT.

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