Surge in Volume
Investing in stocks is just a business of supply and demand. Stocks rising on higher trading volume is usually a very good sign for bullish investors. Investors can avoid false breakouts by confirming above-average volume.
My third rocket stock rule is to find companies that are experiencing a surge in volume as confirmation of a breakout. I want to see stocks that are at new highs and recent daily volume that is at least four times the average daily volume over the last 60 days.
An example of a stock experiencing rocket stock characteristics is Ollie’s Bargain Outlet in 2017. Ollie’s had a 400% volume surge on April 18, 2017, and closed at a new high of $34.90. The stock continued to rise to a high of $97.61 on October 18, 2018, before it pulled back.
My third rocket stock rule is to find companies that are experiencing a surge in volume as confirmation of a breakout. I want to see stocks that are at new highs and recent daily volume that is at least four times the average daily volume over the last 60 days.
An example of a stock experiencing rocket stock characteristics is Ollie’s Bargain Outlet in 2017. Ollie’s had a 400% volume surge on April 18, 2017, and closed at a new high of $34.90. The stock continued to rise to a high of $97.61 on October 18, 2018, before it pulled back.
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