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What is a True Market Leader / TML (Thread)

(And how to find them)

 In one sentence a TML is an institutional quality stock in a leading industry group with superior fundamentals and technicals

These are monster stocks which over the course of weeks and months increase +100% to +5,000%
TMLs are popular with traders/investors whose methodology is based on the CANSLIM system developed by William O'Neil.

He called them Model Book Stocks. Huge winners worth studying to identify common characteristics that they all share
O'Neil studied over 1000 model book stocks going back to the 1880s.

Many are shown and discussed in these must read books

How To Make Money in Stocks, O"Neil
https://t.co/S2sShZedUm

Monster Stocks, John Boik @monsterstocks1 https://t.co/Cw1O9ZazGO

https://t.co/1iAGYk6Brs
A Few Examples courtesy of @SystematiCK_

Pic N Save 1979

https://t.co/d03nEEF4Eq
Netflix 2009

https://t.co/Q7hI22VoMT
Home Depot 1982

https://t.co/hd5c3rm0Si
So what are the Fundamental characteristics of a TML?

Superior:

Quarterly Sales Growth > 25% YoY
Quarterly Earnings Growth > 25% YoY
Pre+After Tax Margins >20% Recent Quarters
ROE >17%
Annual Earnings Ests for the next year > 25%

Story- A new and innovative product or service
Not every TML will have all of these criteria, but in general their record should be outstanding with regards to most of them.

The higher these values the better. Earnings and Sales growth over 100% QoQ is ideal. Annual Estimates for next year over 100% would be exceptional
TMLs are also often in the Top 20 Industry groups at the times of their runs.

The TML is the leader of an overall top group which is riding the tailwinds of changing environments.

Recent examples $SE $SHOP $AMZN Retail-Internet
$TSLA $NIO Electric Vehicles (Auto Manufacturers)
Additionally base liquidity is required for these stocks to be institutional quality.

Dollar Volume > $30 Million is essential and most should have DV much higher than that

@Upticken Likes greater than $100 Million
Accumulation by big hedge funds and mutual funds like Fidelity Contrafund are what move the markets. They won't touch a promising stock unless it has liquidity.
Now for Technical Characteristics of TMLs:

Above a Rising 30 Week Moving Average
Breaking out of a Stage 1 or Stage 2 Base
Trending above Key Moving Averages (10, 21ema, 50sma)
Volume and Price contractions within bases
Up/Down Vol> 1.2
Huge gaps up on volume after Earning Beat
And most importantly they must be showing Relative Strength, meaning they are outperforming the vast majority of stocks in the market.

This. is. vital.

RS Rating over 97 is ideal
During corrections and overall market weakness they should be near all time highs, above their longer term moving averages

They should be standing out like a sore thumb.

@duckman1717 compiled a great resource for relative strength clues

https://t.co/zy3RUEYF9B
During Market Uptrends they should be trending above the shorter term moving averages, forming sideways shelfs during small pullbacks and then breaking out again.

Most stay above their 50 SMAs and even 21 emas for extended periods of time.
So how to scan for them.

Use @MarketSmith, the IBD Stock Screener, Finviz, or another screener

and screen for the fundamental criteria mentioned above
combined with the stock over the 200+50 SMA
It's helpful to have multiple screens splitting up the criteria for instance one scan for the earnings and one for sales.
On Fintwit we also have great traders who share their screens + focus lists.

@PatternProfits
@TMLTrader
@dennisc230
@alphacharts365

are a few who help keep me focused on TMLs
Along with the key books mentioned previously

The Lifecycle Trade by

@EBoboch
@KGD_Investor
@EricKrull1
@Top_Dog_102

Is a great resource which studied recent IPO super growth stocks and compared different rule sets to trade them

https://t.co/Ka6g7ND4uU
And Finally here is a good list of recent TMLs.

Study their charts, where you would have entered and exited given your rules

$LVGO 2020
$TSLA 2019, 2020
$DOCU 2020
$FSLY 2020
$PTON 2020
$SHOP Any recent year
$AMD 2018
$ZM 2020

More from Richard Moglen 📽️🦁🚢

Richard Moglen \U0001f981
Richard Moglen 🦁...
@RichardMoglen
Technical Green Flags

Gap up after Earnings
Relative Strength vs the market
Higher Highs, lows
Retaking MAs
Respect for logical support
Stage 2 Uptrend
Breakouts through resistance on HV
Pocket Pivots
Strong DCRs
Orderly price action
Near or at ATHs
Weekly Vol Spikes

What else?
SCREENERS
Richard Moglen \U0001f4fd\ufe0f\U0001f981\U0001f6a2
Richard Moglen 📽️🦁🚢...
@RichardMoglen
A brief introduction to trading/investing for beginners and why you should start right now (Thread)

A goal of mine is to introduce as many people as possible, especially my own age, to sound methods of how to trade/invest for their futures. Despite the stock market being open to all, in practice, not everyone is taught the value of it or how to use it to build wealth over time

This thread will hopefully help remove the knowledge barrier of how to get started. It will cover briefly:

Why you should invest (Start now!)
What even is stock?
Roth IRAs versus Traditional IRAs
ETFs+ Mutual Funds
How to buy/sell individual stocks.
Types of Investing/Trading

Now before we go further, I am not a financial advisor, I am speaking from my own experience and there are significant risks with the stock market so please consult a financial professional before getting involved. Alright let’s get to it.

First, why should you get involved and start ASAP, like tomorrow. The simple answer is compound interest and time.
TRADERLION
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Richard Moglen \U0001f4fd\ufe0f\U0001f981\U0001f6a2
Richard Moglen 📽️🦁🚢...
@RichardMoglen
5 Ways Weekly Charts can help your Trading & Investing

📈📉 (Thread)

Weekly charts are a powerful timeframe, and regardless of your style, they can help you gain perspective on a particular setup and identify its potential

Using higher timeframes slows the action down and allows you to calmly analyze price and volume.

This will lead to better decision making.

For investors learning to analyze weekly charts and their trends can only complement your fundamental analysis.

For traders they are the "prevailing wind" and trading with this weekly trend will increase probabilities and help you remember to focus on larger patterns

1⃣ Weekly Charts show the True Trend of a Stock

Weekly charts eliminate a lot of the back and forth that occurs intraday and on daily charts. What is left is often a clear picture of the trend of a stock.

⬆️ Trending Up
↔️ Basing
⬇️ Trending Down
TRADERLION
Richard Moglen \U0001f4fd\ufe0f\U0001f981\U0001f6a2
Richard Moglen 📽️🦁🚢...
@RichardMoglen
An Introduction to Price and Volume Action (thread)

An understanding of price and volume action is essential for judging supply and demand characteristics. This allows you to determine whether a stock is under accumulation or distribution and find proper buy and sell points

This thread is not about memorizing candlestick patterns, but instead understanding how supply and demand create patterns over and over again. The Stock Market is an auction, and the large buyers and sellers leave clues for us to find within price and volume.

Let’s start with one price bar. I personally use OHLC charts but feel free to use what makes sense to you, they each present the same information. A single bar can represent a minute, 15 minutes, a day, or a year. The higher the timeframe the more meaningful the price move.


I view each bar as a match of tug of war between the buyers and the sellers. Buying pressure tries to pull the stock price up while selling pressure tries to pull it down. The winner is reflected in the closing range.
TRADERLION
Richard Moglen \U0001f4fd\ufe0f\U0001f6a2
Richard Moglen 📽️🚢...
@RichardMoglen
As Traders, Technical Analysis allows us to Judge Potential, Identify Accumulation, and Manage Risk.

It allows us to see through the noise and interpret price action.

Here is How To Read a Stock Chart For Beginners (Thread)

Let's start with the basics.

When you first pull up a stock chart you will see Price and Volume plotted versus time.


Each price bar represents one period of whatever timeframe you are on

Some people like candlesticks, I personally think Open/High/Low/Close (OHLC) Bars are more intuitive

For each bar/candle, the four important data points of each period are represented:

High
Low
Open
Close.


For each bar, we want to be able to determine whether buyers or sellers are in control and how much conviction they have.

To do this we use our tools: Price and Volume

Thing about turning a price Bar 90 degrees counter clockwise so the high is now on the left and the low is now on the right.

Then picture a game of tug of war with participants representing buying pressure on the left and selling pressure on the right.
TRADERLION

More from Traderlion

Richard Moglen \U0001f4fd\ufe0f\U0001f981\U0001f6a2
Richard Moglen 📽️🦁🚢...
@RichardMoglen
What is an Optimal Buy Point? (thread)

Your results as a trader/investor boil down to three statistics

Average Gain - Average % gain on winning Trades
Average Loss -Average % gain on losing Trades
Batting Average - % of trades that are gains

Like in baseball, you can find incredible success in the stock market winning only a handful of times out of ten. In fact a system that is profitable or break even with only a 30-50% BA is more robust and consistent

To establish such as system you need to manage the risk reward relationship (Average gain/Average Loss) so that you can survive winning only 30% of the time.

(I promise this is getting to optimal buy points shortly)

You should shoot for at least a 2:1 gain/loss ratio. 3:1 is even better.

With a 2:1 ratio you can loss 2/3 of the time and break even. With a 3:1 ratio you can lose 75% of the time
TRADERLION
TraderLion \U0001f981
TraderLion 🦁
@TraderLion_
4 Simple Steps to Avoid Downtrends 📉 (a thread)

🧵


1. Know the difference between an uptrend & a downtrend 📈📉

At TraderLion, we identify an uptrend as stocks/markets that trade ABOVE a RISING 21DSMA and 50DSMA.

A downtrend occurs when stocks/markets trade BELOW a downsloping 21DSMA/50DSMA.

Let's look at an example 👇

$QQQ from 2020 shows what an uptrend, downtrend, and even chop period looks like.


2. Know when it is really time to make money on the long side.

Swing Traders: when markets/stocks are above the rising 21D
Position Traders: when market/stocks are above the rising 50D

We can take this one step further by understanding what a Power Trend is 💪

The trend is really your friend when we have a Power Trend in the general indexes. A concept coined by the @IBDinvestors team, we must have the following:

✅ Low > 21ema for past 10 sessions
✅ 21EMA > 50SMA for at least 5 sessions
✅ 50SMA slope is positive
✅ Market closes up
TRADERLION
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TraderLion \U0001f981
TraderLion 🦁
@TraderLion_
Building a Daily & Weekly Routine Workflow to Increase Profitability

--- Thread 🧵 ---

The stock market is one of the most complex systems in the world, with parts that change every single second.

As individual investors, we need to bring a level of consistency to our system that can prevent us from feeling overwhelmed.

Routines offer this consistency.

As a retail trader/investor, you must have a set routine for your daily review and weekend review.

This is non-negotiable if you want to outperform the market or increase your current levels of profitability.

In your Daily Routine, you should review the following 👇

🔹 General Markets
🔹 Current Positions
🔹 Emotional Review
🔹 Focus List
🔹 Summary


General Markets (10 min)

The goal is to identify if the wind is at our backs.

You should note whether there has been a recent cluster of accumulation/distribution, where price is with respect to the KMAs, & the index's relationship to the highs.
TRADERLION
Richard Moglen \U0001f4fd\ufe0f\U0001f6a2
Richard Moglen 📽️🚢...
@RichardMoglen
How to time the market (thread)

There is the old saying that “Time in the market beats timing the market” The chart below from Dr. Wish’s @WishingWealth presentation at the @TraderLion_ conference shows that to be false.

Full presentation: https://t.co/o2f21GBXci


The green line is unattainable realistically, however, missing volatile times during corrections yields better performance than buy and hold and we can aim for the green line.

Investors usually only show the gray and red results.

More

There are many strategies for investing/trading in the stock market operating within different timeframes and with different objectives.

That is of course what creates a market and opportunity. Timing the market may not be what works for you or what fits your goals/lifestyle.

However, everyone involved in the market is here to make money over time and corrections can cause huge drawdowns in the high alpha names negating incredible performance during strong market uptrends.
TRADERLION
TraderLion \U0001f981
TraderLion 🦁
@TraderLion_
3 Simple Steps to Quickly Grow a Small Trading Account

--- Thread 🧵 ---

1️⃣ Define a Repeatable Edge

A basis of any successful trading system is having an edge over a series of trades.

Without a well studied edge, you cannot succeed in the market.

Example of edges:

Trend system
* Trading during the power trend
* Trading stocks that are in uptrends
* Trading GROUPS that are in uptrends

High Volume Edges
* Highest Volume Ever (HVE)
* Highest Volume in > 1 Year (HV1)
* Highest Volume Since IPO (HVIPO)

2️⃣ Define Entry Tactics from that Edge

Once you have an edge, you need an entry tactic.

Entry tactics are repeatable and definable. You should know your entry and exit points before ever placing a trade.

Examples of entry tactics:

Trend system
🟢 Enter on two closes above a KMA
🔴 Exit on two closes below a KMA

High Volume Edge
📊 High Volume Close
📊 High Volume Support

Edges & Entry tactics have to be repeated CONSISTENTLY to reduce randomness when trading a small account.
TRADERLION

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MAHARAJA CHHATRASAL BUNDELA was the great Bundela King who revolted against the Mughal ruler Aurangzeb.
Chhatrasal Bundela was born in year 1649 CE in Maur Hill of Bundela region to Champat Rai and Lal Kunwar. He was the descendent of Rudra Pratap of Orchha.


His ancesters were the vassals of Mughal Emperor. He drew inspiration from his father and revolted against the alien rule of Mughals. He was just 12 yrs old when his parents died in fight against the Mughal Army of Aurangzeb in 1661.

When his beloved father attained martyrdom in the year 166, the young Chatrasal was present in the last battle of his father against the Mughal and from these valiant campaigns,..

..he gathered the courage to free Bundelkhand from Aurangzeb’s rule.
He joined the Mughals initially, and was recommended by the Rajput King Mirza Jai Singh to be recruited in the Mughal Army in order to support their Deccan Campaigns.


But serving the alien rule of Mughals which brought chaos and misery to Bundelkhand was unacceptable for Chatrasal Bundela and his father’s incessant struggle against the Mughals kept the fire of independent Bundelkhand alive in his heart.
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Switch from WhatsApp to Signal and enable disappearing messages. Most of us cannot stop using WhatsApp entirely but at least turn off back ups to Google Drive or iCloud. 2/n

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MAHARAANI TARARANI: THE QUEEN OF MARATHAS

Rani Tarabai was the brave daughter-in-law of Chhatrapati Shivaji and one of the greatest medieval Monarchs India ever had.
She was born in 1675 to one of the bravest commander-in-chiefs of Shivaji's Army named Hambir Rao Mohite.


Tarabai was just 8yrs old when she was married to Shivaji's younger son, Rajaram. Mughals and Marathas were constantly at war with each other. Shivaji was crowned the ruler of the Independent Maratha Swarajya in 1674 which was established by him.


However,the great leader died in 1680&the Maratha Samrajya went into a complete&total chaos.Marathas saw some very tough times ahead. In 1689,when Raigad Fort fell to the Mughal Army of over 15000,Shivaji's first wife Saibai and his elder son Sambhaji were captured&put to death.


Sambhaji's wife and son Shahu were taken prisoners to the Mughal court. During the same battle, Shivaji's second son Rajaram(Tarabai's husband) , who was the heir to the throne now, managed to escape using a disguise. He made his way to the Gingee Fort in Tamil Nadu.


Mughal General Zulfikar Khan, however, followed them to Gingee laying siege to the Gingee Fort. From 1690-1698,This was the longest siege by a Mughal Army of any Fort which stands testimony to the military and diplomatic credentials of Rani Tarabai.
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