analyses the state of the Australian share market on a weekly basis.
also runs a scan* over the market to look for new investing
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the below details and a lot MORE here....
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Weekly Watch List Table
Sample at right - click to see the sample in a new window.
The main (colour-coded) sections of the table
in the Watch List are as follows (more information is included in the FAQ section below):
1. Page Header section
Near the top of the page, in the upper right-hand corner, is a small colour-coded table with text. The text and colours together summarise the current "trend" of the market.2. New on the list this week... (green)
This is a list of stocks that were not on the list last week, but which have appeared on the list this week.3. Carry over from last week... (yellow)
This is a list of the stocks that were on the list last week, and which are still on the list this week.4. Off the list this week... (salmon)
This is a list of the stocks that were on the list last week; but which have been removed this week.How do stocks get onto the table?
See the selection criteria details below.
How to read the table?
Sort sequence - How are the rows of information sorted in the Watch List table? See details below.
More information about the Weekly Watch List table, and how the stocks are selected, and what we do next, is included in the Frequently Asked Questions section in the material below.
If you are ready to take that small step to become a Toolbox Member, see the How-To-Join information with all the details. If not, see the Frequently Asked Questions below.
Toolbox Premium Members...
Premium Toolbox Members can see the latest Weekly Watch Lists here, as well as archived copies of past Watch Lists. And there is information about exactly how we choose the stocks for the Watch List, and what we do with the list now that we have it.
Want to become a Member?
See the How-To-Join information with details about how to become a Toolbox Member.
Robert would be happy to send you the Weekly Market Analysis email with a summary of the latest Watch List details, or simply keep you informed of new information as it becomes available.
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Frequently Asked Questions
about Robert's Weekly Watch List
NO! - This is definitely not advice of any sort. We do not have an AFS License, nor does he take your personal financial situation into consideration. So there is not way that this information can be advice.
This information is for education only.
There is NO recommendation here to buy or sell and stocks, nor any other sort of investment.
You should always seek suitable advice from
a properly qualified professional licensed advisor
before making any investment decisions.
It can be said that any investing or trading strategy might be successful for one person, but not successful for another. This is due to a number of reasons, including one's own risk tolerance and psychological make-up.
|Is this a
list of Hot Stock Tips?
Robert's Weekly Watch List might look like a list of Hot Stocks, or it might look like a list of Stock Tips - what to buy and what to sell. But it is not this at all. Robert might treat the list in this way because it suits his purpose, his strategy, and his investing risk tolerance.
So, what is the purpose?
Robert's Weekly Watch List is being shared as a sample application of how to use technical analysis for selecting possible investment opportunities. By following the links, and understanding the concepts, we can see the investing and trading strategy being used.
overview (ie. Brief summary)
stocks - Which stocks do we select from?
For this "Weekly Watch List" strategy we are looking only at Australian listed companies. We want to minimise the risks - so we exclude speculative stocks. When we decide to exit a position, we will want to be able to exit the position quickly - so we will avoid illiquid stocks (ie. stocks which don't trade frequently enough, or which have very low turn-over). Stocks with relatively high debt levels have a greater risk of defaulting on their debt when times are tough - so we will avoid these stocks as well.
For now, the simplest way to achieve all the above is to use the stocks that are included in a major index like the S&P/ASX 200 (ie. the XJO). For a longer list of stocks we could apply Funda-Technical Analysis and select from all stocks. [By the way - Which stocks are in the XJO index?]
criteria - Rising Trend and Moving Averages
The criteria that we use here to put a stock onto the Weekly Watch List is based on the notion of a rising Moving Average. This is one way to quickly spot a rising trend - more details on trend-spotting here. In fact, for this strategy we look for two Moving Averages to both be rising for 3 weeks. The sample chart at right is a lovely example of a healthy rising trend (click on the image for a larger version in a new window). Note how much this share has risen in price, and over what time period - not bad.
But which two Moving Averages do we use? - See the details in the Premium Member section of the Toolbox.
- "The Trend is Your Friend"
The first plank of our stock selection strategy is the notion of a rising trend. If we can spot a reliable rising trend in share price, and then ride the trend, then we are at least half way there.
See Brainy's "3Ways Rule (in 3Times)" for information about trends,
as well as more details on the Trends page.
Each of the stocks that is chosen to be included on the Weekly Watch List is allocated a Score. This score is calculated as a part of the BullCharts scan, using the BullScan criteria, and each scan criteria is assigned a "weighting". A stock that meets all criteria ends up with a "Score" of 100 out of 100. If a stock does not meet some of the criteria, it's "Score" will be less than 100. If a stock meets none of the criteria, then it is not on the list at all.
The details of these scan criteria and the score calculation are available to Toolbox Premium Members here. There are some clues in the next section below "Tell me more about...".
more about this Investing and Trading Strategy
The complete and detailed Investing and Trading Strategy that Robert uses with this Watch List approach is explained in detail across several of Brainy's eBook (PDF) Articles. Anyone can view the first page of each Article, but only Toolbox Members (and Premium Members) can view the Articles in full. (And Robert actually has other strategies to suit different circumstances.)
Relevant Articles and links for Toolbox Members (non-Members can see the "Page1" items):
this information reliable? Has it been tested?
A specific stock selection strategy has been used to identify the stocks to appear on this Watch List. This strategy has been back-tested using BullCharts and TradeSim over specific date ranges. The results of the back-testing are being prepared and will be available here soon.
the Weekly Watch List each week
We are happy to send you the Weekly Market Analysis email each Saturday, which includes relevant comments and the links to the latest Weekly Watch List table.
To get this, all you need to do is subscribe to Brainy's Share Market Toolbox as a Premium Toolbox Member - more details are here. See the How-To-Join information with details about how to become a Toolbox Member. Not convinced about Toolbox membership? See the reasons why you should join.
|How is the
Watch List information prepared?
All of the charts and the watch list results are produced and derived using the Australian BullCharts charting software.
The market is scanned using the BullScan tool with specified selection criteria, and price charts with indicators are viewed using the BullCharts software as required.
|The columns in the table?
The columns in the table include (updated June 2015):
|The sort sequence for the rows in the
The rows in the table are firstly grouped into three categories:
of these stocks are losers?
Remember, whenever stocks drop off the Weekly Watch List it does not mean that they should be sold (if owned). Remember the criteria for entry onto the list (two rising Moving Averages), and our own Trading Strategy criteria for selling the stock. If we view the charts for the stocks that have gone off the list recently, there are usually some that fall and eventually trigger the Stop Loss, while others eventually rise again. One way to help explain this situation is to see the sample chart at right (click for a larger image) of APA. We should always compare the latest share price with our pre-determined Stop Loss level and sell if the Stop has been breached, and continue to monitor in coming weeks.
Also, it's important to remember that some of the stocks on the Watch List will lose money (fall quickly before triggering the stop and realising the sale). That's one of the facts about investing and trading. BUT, with proper "money management" our portfolio can still come out in front!! This is because if we cut our losses short, and let our profits run, then the accumulated profits should be greater than our losses. Even if we have a win to loss ratio of 50%! That is, if we have 5 wins and 5 losses, we can come out ahead provided our profits are larger than our losses.
|Why is a
stock "off the list" if the WATRTS is not broken?
Our selection criteria says that to be "on the list" a stock must have two specific moving averages increasing for the last three weeks. Now, it is possible for one of these moving averages to stop increasing for a week or two, because the share price is taking a "breather"; but for the price to stay above our Stop Loss level (the Wilson ATR Trailing Stop). And the price can then continue to rise, and cause both moving averages to rise again.
So, why don't we fiddle with the selection criteria to keep these on the list?
There are two reasons: The stock might be showing early signs of weakness, in which case we can monitor the stock and be on guard in case of a pending fall. Secondly, a temporary sign of price weakness might be an opportunity to enter the stock again at a cheap price.
stocks on the list do nothing for the first few weeks - Why?
This observation is a common occurrence with stocks that break out above resistance, of from a recent trading range. It can often be seen in different time periods (on daily charts, or weekly). The stock breaks out, but some people want to recoup their investment at these recently high prices so they sell, and with the excess of sellers in the market the price falls away. But once these sellers are gone from the market, then only the buyers are left to take the stock on to higher highs.
When they fall, the stock can even fall lower than anticipated; but it can stop falling at a recent support level which might be the bottom of a recent trading range. A picture tells a thousand words, and this is one it is useful to view the price chart.
This process can take several weeks to unfold.
the number of stocks on the list
An updated graph of the number of stocks on the list is sometimes included as the last page of the Watch List Table PDF document.
This graph (sample at right - click for a larger version) shows how the number of stocks on the list from week to week fluctuates between extremes, and since the start of this graph (January 2010) the total number of stocks on the list has been above 120 only twice. And it has dipped to between 20 and 40 a few times, and fallen as low as 10 in August 2011.
It indicates that there tends to be strong moves between extremes.
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More information about the TOOLBOX MEMBERS AREA.
Weekly Watch List information for Premium Members
The information presented herein
opinions of the web page content owner, and
are not recommendations or endorsements of any product, method, strategy, etc.
For financial advice, a professional and licensed financial advisor should be engaged.