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Aug 05

Scanning for supernovae

Yes you read that right. The plural of supernova is supernovae. I am obsessive about grammar. By the way, the plural of index is indices, not indexes. Anyway, supernovae are stocks that are up an insane amount, over 100% in a couple days; Tim Sykes originated the term. The supernova du jour is GGC, which I am now looking to short aggressively on the right price action (what do I mean by the right price action? Buy Sykes’ excellent DVD

I am a happy user of Stockfetcher.com. Here is the code I use to scan for supernovae.

show stocks where close gained more than 99 percent over the last 5 days
and price is between .25 and 15
average day range is above 8
and volume is greater than 500000

set{ DayChg1 , close – close 5 days ago }
set{ DayChg2 , DayChg1 / close 5 days ago }
Set{ 5DayPctGain, DayChg2 * 100}
add column 5DayPctGain
and sort column 5 descending
Set{5DaysAgoPrice, close 5 days ago}
and add column 5DaysAgoPrice

Looking for my watchlist? This is it. GGC is the stock I’ll be watching tomorrow. WUHN is also almost a supernova but I couldn’t find shares to short. AIG may be interesting, along with other finance plays, but I don’t like trading finance stocks. CMLS also on watch, more likely a good buy tomorrow than a short. I probably won’t play it.

Disclosure: No positions. I am a customer of Stockfetcher.com, subscribing to their cheapest package. I have no other relationship with them. I have a disclosure policy.

8 comments

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  1. Shawn

    What makes CMLS such a good bye? I’m just starting out and landed on your blog from Tim’s site haha

  2. Ross

    Howdy sir. You said that you don’t like trading finance stocks. Is there any particular reason(s) why? I’m a beginner at this game so I’d be interested to read what you have to say about them. Thanks.

  3. Yngvai

    Cool…I’ve got a similar filter that I use to find these types of short setups…..I like to look for stocks 80%+ off the 5-day low, and 15%+ above the upper bollinger band. Here’s my filter:

    set{fivedaylow, Low 5 day low}
    set{a1, Close / fivedaylow }
    set{a2, a1*100}
    set{percentincrease, a2 – 100}

    add column percentincrease

    set{b1, upper bollinger band(20,2)}
    set{b2, close / b1}
    set{b3, b2 * 100}
    set{percaboveubb, b3 – 100}

    percaboveubb greater than 14
    and volume above 100000
    and close above 0.5
    and percentincrease above 79

    add column percaboveubb

    sort by column 5 descending

  4. Reaper

    Yngvai – thanks! Of course there is no one ‘right’ scan; I have other scans I use to find potential shorts that aren’t true supernovae.

    Ross – As Tim Sykes likes to say, he makes money by trading stocks up on hype and manipulation. Finance stocks have plenty of smart traders (hedge funds) trading them. I like to trade against dumb individuals, not smart pro traders.

    Shawn – I don’t think CMLS is a good buy. But one big up day on huge volume is often followed by another. So odds favor that it goes up today.

  5. Preston

    I have a funny feeling you killed GGC this morning.

    By the way your back to # 1 on the Fool, I know you don’t pay much attention to that anymore but I thought to let you know.

    My TYP has paid off but I’m still holding because I think more downside is to come, but I will not hold overnight.

    AIG has flew up.

  6. Reaper

    Nope, blew it on GGC. It was so beautiful too. If I had nailed it that would’ve been about $10,000 in profits.

  7. Vidya

    Hi Michael,
    Can you please explain your code logic? When I typed up this filter on stock fetcher to experiment it shows stocks with low volume. Please help me understand if am missing anything. Also, do I need to have a subscription to even experiment this code on their site?
    Thanks,
    Vidya

    1. Michael Goode

      and volume is greater than 500000

      That is the line that sets volume at a minimum of 500k. Probably best to use $ volume (Price * volume is greater than 1000000)

  1. 14 Hot Stocks Breaking Out Which Led To $7,000+ In Trading Profits | TIM - Timothy Sykes

    […] GGC & RINO both keep uptrending…both I thought the stories were good and in bull markets, good story stocks can and do go muuuuch further than most anyone expects…it’s not about being right, it’s about understanding the variables that contribute to such predictable moves (which is what my instructional DVD packages are for)…both of these are now potential shorts, but their stories are still intact so both are extremely risky, with fakeout breakdowns galore. Reaper has a nice blog post with this Supernova chart HERE […]

  2. How I missed an easy $8,000 on Georgia Gulf Corp. (GGC) « Reaper Trades

    […] Trading Profits « Scanning for supernovae […]

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