Saul was kind enough to help me through this. Follow the link at the end to view and download them yourselves. These are charts that I created following Saul’s. Please excuse all scratch outs, errors and their generally unkempt nature (Rembrandt I am not!). There are some errors especially with regard to the stock prices. I didn’t even bother to list CRTO stock prices as they would have been off the page. This is the only chart that starts the vertical axis at 0.1 instead of 1.
The purpose of this is for everyone to get the general picture of what Saul sees in his graphs.
The key here is that the vertical move tells you the growth and acceleration. All equal percentage jumps have an equal distance move in height. Take a ruler and measure it yourself. Start at a price of 20 and move to 40 for a 100% move. Then try 50 to 100 or any other 100% move.
You don’t need to know the exact numbers to recognize a stock that is on the rise quickly. You intuitively see it after looking at just a few charts.
The steeper the slope, the higher the percentage growth & acceleration. Also, it shows the steadiness of a company’s earnings. Check out BOFI. It would be tough for me to draw a straighter line than the last 6 quarters (see Rembrandt ref).
Saul generally lists quarterly earnings, quarterly revenue and TTM Earnings on each graph. BOFI has a few extras and one that I’m not showing. I think it is non-interest income.
Okay, enough rambling. I could say a lot more about these charts, but then I’d just be gushing and nobody wants to see a man do that. Link is below.
You rock Saul!
Thanks so much A.J.
A picture is worth a thousand words! Very helpful for getting started on this.
That’s awesome, AJ. You captured what I do perfectly! And you even figured out how to show the board. Thanks.
PS, You might like to link to the graphs of one or two other stocks for comparison for people.
Saul asked for an example of a stock we haven’t seen. Although I suspect he was looking for an example of a flatter TTM earnings line. Here I did not appease.
I present the chart for Gilead. This one is truly amazing to me. After next quarter’s earnings, we’ll need a new page starting at an earnings of $10 per share. That isn’t the amazing part though. The amazing part is that the stock price and the earnings line will not be on the same page. But for the exact opposite reason as one would expect with a slope like this.
In this case, the TTM earnings will be on the page above where the stock price resides. For such fast growth, the market is really concerned about the future of GILD.
My guess is they remain a dominate fixture in the Hep C market for the next 5-10 years and deploy their mountains of cash to buy new drugs and take them to market as they did with Sovaldi/Harvoni.
I’d love to see charts of other companies that others are interested in.
I was surprised at the format of the price values on your charts. I expected a simple line chart from quarter to quarter, but the price plots look sort of like an OHLC (open-high-low-close) except that you have a single crossbar rather than a small horizontal line on the left for open and one on the right for close. Also, I can’t figure out the time scale for the plot points. Can you explain?
I think I can but Saul may want to confirm. That line is the high to low price for each month. Each line along the horizontal axis represents one month.
The cross bar is the ending month value.
re: Weekly charts
http://stockcharts.com/h-sc/ui?s=SWKS&p=D&b=4&g=… Daily chart
If you folks were a Stockcharts dot com subscribers, you can see the Monthly charts.
Swing Traders would buy and sell at each xover, Simon Sez players would buy and sell per the flags. For others, "Buy-and-hold is what people say; buy-and-bail is what they do. Jason Kelly who wrote “The 3% Signal”.
I think I can but Saul may want to confirm. That line is the high to low price for each month. Each line along the horizontal axis represents one month. The cross bar is the ending month value.
That’s exactly right AJ. A vertical line monthly running from the high to the low, and a crossbar for the close. (The start for the month is just the close of the month before).
thanks for posting these. I finally get what Saul has been saying for so long.
But how do i create the graphs?
The most recent knowledge base is at post #7972. There are four posts listed under the Graphing portion that do a very good job of explaining how to create these graphs. Let me know if you have specific questions.
One of the posts mentions the paper Saul uses that can be found on-line. I used a different on-line source since it printed out better. If you can find paper that has “5th Accents” it will help you but is not necessary. These are the mid-points between the major lines. My paper does not have the intermediate accents. That is why I have hashes are the right and left that show, for instance, $1.50 Earnings and Price of $30.
After you have the paper, it is just a matter of plotting the TTM earnings and the candlestick monthly stock prices.