Lgih and Marketsmith

Doing a trial with Marketsmith. In researching Lgih Friday the stock alerted subscribers that it was in a pivot point waiting for a breakout. Got a email this morning that it was now breaking out. And when that signal hit my email that stock exploded upwards.

Finally took a position in LGIH and Hubspot today!! Thanks Saul!!

I have done several trials of MarketSmith and it is very intriguing, $150/month otherwise. The chart recognition is nice, finds the cups, cups with handles, double bottoms, etc. Shows the “proper” buy range and potential profit taking range (and mandatory selling range - 7-8% loss max). It has all the fundamental info and IBD rankings right there on the chart. You can create very nice watch lists and click through them one at a time and see the associated charts. Powerful tools. Perhaps when I retire I will have the time to really dedicate to this style.

I have been using the IBD approach seriously for about 1.5 years now and my Fool scorecard says I am beating S&P by 5.75%, which is nice. There are a lot of shorter term trades, so it is best in an tax sheltered account. That said, I can spend 2 hours a night reading articles, checking ratings, looking at charts, setting alerts in my Fidelity account. So that is a lot of work and I am thinking of either going big or going home. Going big would be allocating a bigger portion of my funds to the approach and buying in bigger chunks.

Todays was a good day for breakouts and I bought ALRM, FIVE, MMSI, and RNG off my breakout watch list. Also bought LGIH after it faded below the breakout point, so it is not a “valid” IBD (CANSLIM) buy, so maybe I will put it on my “SAUL” scorecard in the Fool.

(Investors.com is free this week and worth checking out).

LGIH is ranked #2 in its group. Very strong relative ratings…

Checklist…Rating
Composite Rating 98 Pass
EPS Rating 91 Pass
RS Rating 93 Pass
Group RS Rating A+ Pass
SMR Rating A Pass
Acc/Dis Rating B Pass

FYI, I build my watchlist with Googlesheets, since it can look up the current price. I have a column for the pivot point and then the sheet does math to see how far above or below the pivot the current price is. Another column calcualtes the 5% max buy price above the pivot and another calcuates my max buy price of 4% above the pivot. I have columns for it rating in the group, the composite rating, notes, earnings date etc. I also have columns for 20% and 25% profit prices, which I use when I transfer from the watch list to the “own” list/tab.

IBD article on home builders

Lennar (LEN), the second largest homebuilder by revenue, reports its fiscal third quarter results before Tuesday’s open

The stock rose 5% last week in a good week for homebuilding stocks. That put shares back above their 10-week moving average, and nearer to possible buy points at 54.96 and 55.85. A shock of good news during Tuesday’s earnings release could produce a breakout, although in an odd year for the construction trades, and after Lennar’s prereleasing a portion of its Q3 results following hurricanes Harvey and Irma, it does not seem likely.

Other homebuilders are nearer to buy points, however. KB Home (KBH) cleared a 24.47 buy point in a cup base last week and remained in a buy range just above that entry. The same held true for Meritage Homes (MTH), which plotted a buy point at 44.55.

LGI Homes (LGIH) on Monday was almost out of reach, trading at the top of its buy range above a 46.99 buy point. LGI, KB and Meritage are all poised at or just below new highs.

**I did not see the pivot as 46.99, but as 50.05 because 46.99 did not look like a handle to me, so I may have misjudged it. What did MarketSmith set the pivot as? Either way, the volume was there today and not at 46.99.

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And of course I have Google Sheets color code values for a nice dashboard effect. Here is what my entry for LGIH looks like…


Stock	Price	Pivot	above/Below Pivot	5% Max	4% Stop Limit	20% profit	25% profit	buy price	% loss	Earnings Date	COMP	# in Group	Own It	Alerts	Notes
lgih	$48.98	$46.99	        4.23%	        $49.34	$48.87	         $56.39	        $58.74	      $49.28	        -0.61%	11/8/17	        99	    2		          set	10/1: all ratings green

Could Puddin or someone explain how he uses the 20% and 25%

Thanks

And of course I have Google Sheets color code values for a nice dashboard effect. Here is what my entry for LGIH looks like…

Stock Price Pivot above/Below Pivot 5% Max 4% Stop Limit 20% profit 25% profit buy price % loss Earnings Date COMP # in Group Own It Alerts Notes
lgih $48.98 $46.99 4.23% $49.34 $48.87 $56.39 $58.74 $49.28 -0.61% 11/8/17 99 2 set 10/1: all ratings green