Best Stock Yesterday Indicated by a MACD Divergence

Apple (NASDAQ:AAPL) dominated the headlines yesterday with good earnings news, giving it a 6% gain on the day.  But do you know what the best stock (biggest gainer) really was?  Regional bank Dearborn Bancorp, Inc (NASDAQ:DEAR) was actually the top stock on the day with a massive 74% increase.  Today as I write this, DEAR is continuing upwards, and more regional banks are the top % gainers while AAPL holds steady.  (comments? please add your thoughts on this post)

How might you find stock picks like DEAR before they shoot to the top?  One indicator is a MACD Divergence.  This daily chart of DEAR shows a MACD Histogram divergence detected at 12/17/09, flagging a buy at $0.49.  That simulated trade is still open above $3, which is a 6x gain!

Daily Chart of DEAR

Daily Chart of DEAR

 

Weekly Chart of DEAR
Weekly Chart of DEAR

Now DEAR is an extreme example.  Not every MACD Divergence turns into a top stock.  If you’ve taken The Truth About MACD video course you know what to expect: many divergences get stopped out.  But the potential exists for a powerful reversal if you can find it ahead of time, as we can see in the DEAR example.

Which brings me to my question for you…how do you want your divergences served?

After repeated requests for a service that alerts traders to MACD divergences as they arise, we’re looking at how to make that happen and would love to get your input and insights.  Please take a moment and click your favorite checkboxes on the survey.  It will help us design a service that’s most useful to you. 

https://app.icontact.com/icp/sub/survey/start?sid=7910&cid=369225

The Thank You page for the survey will point you to sample web pages with recent divergences from the scanners.  Among the stocks from the weekly scans is EUBK, which was #13 yesterday with a 21% gain.   We’ve since updated with this week’s MACD Signals; here’s a screenshot from apr 16, (click to enlarge).

macd_div_weekly_100421

(Disclosure: I don’t have a position in DEAR or AAPL.  Even having all the divergences in front of you isn’t a guarantee of being in the best stock at the right time.  Written apr 22 and updated apr 23 2010)

April 22nd, 2010 Filed under MACD, Technical Strategies

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    • 2 Responses to “Best Stock Yesterday Indicated by a MACD Divergence”

    1. jackieannpatterson | 22/04/10

      EUBK closed up 55% today - 2nd best. It showed up on the MACD weekly scans for 4/16/10 Not a bad week!

    2. jackieannpatterson | 26/04/10

      EUBK was the top stock today with a 112% gain. That is a 244% gain since it showed up on the weekly MACD scans.
      (I don’t hold a position in EUBK at the time of this writing)

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