In Search of Winning Stocks

This Week: Searching For MACD Breakouts

1.  Searching For MACD Breakouts
2.  Search Criteria
3.  One Stock With A Recent Positive MACD Breakout
4.  Disclaimer

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Wall Street City's Stock Search of the Week

1.  Searching For MACD Breakouts

The Moving Average Convergence-Divergence (MACD) is one of
the most used technical indicators.  It is an oscillator
uses the difference between two moving averages, for purposes
of the search - the 12 and 25 day moving averages, to
calculate a 9-day moving average.  The resulting 9-day
moving average is then smoothed to form a signal line.  A
positive breakout, which signals a buying opportunity,
occurs when the MACD crosses above the signal line.

MACD Breakouts is a search strategy that screens for stocks
which have had a positive MACD breakout within the past two
days.  Two criteria, 30-day Average Volume and Stock Exchange,
are included in the restrictive mode to ensure that the
stocks found by the search strategy have at least minimal
levels of liquidity.  Illiquid stocks may be prone to more
volatile moves, reducing the accuracy of oscillators in
predicting trends.

Return on Equity (ROE) is included a final criteria, in the
rank mode.  Backtested results showed improved performance
when this indicator was included compared to excluding any
fundamental criteria.  The reason for the improved
performance is that stocks with strong underlying
fundamentals are better positioned to sustain long-term
upward moves than those that are fundamentally weak.

The search strategy can be run on a daily basis and is useful
for both active traders and long-term investors who are
looking for potential buy signals.  It should be noted that
many technicians rely on a combination of several buy signals
and a positive MACD breakout should be used as an indication
to conduct further analysis, rather than as a sole indication
to enter into a position.  Investors can click below to see
the current results.

http://clyde.investools.com/T/A28.146.330.1.113719

2.  Search Criteria

Using Wall Street City's ProSearch tool, investors can
build a search like the one below created by Wall Street City
analysts to find stocks that have charted recent MACD
breakouts.

Indicator                      Mode
------------------------------------------------------------
MACD Breakout 12/25/9 Day      Between  1.0 - 2.0
Volume 30-Day Average          Between  250.0 - 99999.9
Stock Exchange                 ALL US MARKETS
Return on Equity               High as Possible

Investors can click below to view screen results.

http://clyde.investools.com/T/A28.146.330.2.113719

3.  One Stock With A Recent Positive MACD Breakout

Argosy Gaming {AGY} charted a positive MACD breakout 2 days
ago after holding support near 23.50.  The pullback was a
rare one for the stock, which is up 32 percent so far for
2001, continuing a steady upward trend that started last
summer.  Investors who took the risk of buying last July
have been rewarded with a 85 percent gain.  Despite this
material increase in price, AGY continues to trade at a
discount to its projected growth with a PEG ratio of 0.79.

Click below to view screen results.

http://clyde.investools.com/T/A28.146.330.3.113719


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4.	Disclaimer

Wall Street City's Stock Search of the Week is published
solely for informational purposes and is not a solicitation
or an offer to buy or sell any stock, mutual fund or other
security.  The information obtained from internal and
external sources is considered reliable, but has not been
independently verified for accuracy and completeness.
WallStreetCity, its employees, and/or officers and directors,
may from time to time have a position in the securities
mentioned and may sell or buy such securities.
Trading involves risk, including possible loss of principle
and other losses.  Trading results may vary. No
representations are being made that these techniques will
result in or guarantee profits in trading.  Past performance
is no indication of future results.

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