I don’t know about you, but as someone heavily involved in stock analysis on a regular basis, I often feel like there must be a better way to approach the markets. Just imagine how much time you could save if, instead of poring over the details of each individual stock out there, you had a tool that could do so for you. Well, that’s exactly what we’ve aimed to create with Auspex, our latest stock picking system.
You may already be familiar. Indeed, over the past few days, we’ve offered glimpses into this tool’s inner workings.
In short, Auspex leverages fundamental, technical, and sentimental data to help us find the stocks with the strongest possible setup. That way, we have the opportunity to get into the most promising stocks at the best time – before they go on to rise.
We’ve spent the past several months developing, testing, even using Auspex to help us home in on such up-and-coming market winners. And today, we finally revealed this new system for the very first time.
But… before you check out the replay of that exciting broadcast… I would like to finish explaining just how this innovative model helps uncover the market’s future top performers.
That is, in yesterday’s issue, we discussed how Auspex uses a series of fundamental factors to narrow down a universe of ~14,000 potential picks to uncover just those that meet our very strict criteria.
And today, I want to explain how Auspex takes those fundamentally strong stocks and whittles the list down even further, ultimately landing on the best picks the market has to offer.
Using Fundamentals, Technicals and Sentiment to Reveal Top Stocks
As we’ve mentioned previously, when we have Auspex scan the markets, it analyzes a universe of roughly 14,000 stocks. And in our scan from early December, only about 300 of those 14,000 stocks were deemed fundamentally strong, with accelerating sales and earnings growth and swelling profit margins.
But we don’t stop there. After receiving those results, we incorporate additional technical and sentimental parameters to continue paring down that list. And ultimately, only a few stocks make the final cut. For example, out of 14,000 possible stocks, Auspex identified just 10 picks for the month of December.
OK… so, how does this system deem which stocks are worthy investments?
Well, when it comes to technicals, we’re essentially looking for stocks with strong upward price momentum.
We want to see the 200-day moving average (MA) sloping higher, indicating that the stock’s primary long-term price trend is positive. We also want to see the 50-day MA trading above the 100-day, as well as the 100-day trading above the 200-day MA. That indicates that short- and medium-term price momentum are both growing stronger.
Additionally, positive action on the moving average convergence/divergence (MACD) line – with the MACD above the signal line – is also ideal. It’s another indication of strengthening price momentum. And, lastly, we want to make sure the stock isn’t “too hot” or overbought. That’s why we look for stocks where the relative strength index (RSI) measures less than 70.
Now, on the sentimental side of things, we hope to find stocks that analysts are getting more bullish on and that have investors flocking to get positioned in. Specifically, we want to see earnings estimates moving higher and trading volume on the rise.
Then we layer these technical and sentimental filters on top of the fundamental filters we’ve discussed to find the stocks that are strong in every way.
The Final Word on This Stock Picking Innovation
And as we said earlier, that list can be quite short.
Auspex scans about ~14,000 stocks every time we run the model. Typically, only around five to 20 stocks make each final cut – sometimes fewer, sometimes more; but typically within that range.
Ultimately, that is less than 0.1% of the total stocks Auspex analyzes.
And that is how we use Auspex to help identify the most promising stocks at the best time to buy them.
This innovative system blends rigorous fundamental, precise technical, and forward-looking sentimental analysis to uncover future market leaders… before the crowd catches on.
With Auspex, you can gain a critical edge, identifying stocks poised for success while saving your valuable time.
Don’t miss this opportunity to learn how this robust tool can elevate your investing approach.
Click here to access the replay now, and take the first step toward smarter, more confident stock picking.
The next market winner is waiting. Let Auspex help you find it before it takes off.
On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.
P.S. You can stay up to speed with Luke’s latest market analysis by reading our Daily Notes! Check out the latest issue on your Innovation Investor or Early Stage Investor subscriber site.
