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FloatCharts.com
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December 17,
2005
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Two stock charts appear below. The first chart shows how the stock looked when
we sent it out as a Stock Alert buy recommendation. The second chart shows the resulting price move. The purpose of these charts is to demonstrate the
principles of Float Analysis and the power of Float Charts. Float Turnover Theory (The Basics) - When a company comes public it issues shares outstanding. The management always holds some percentage of these shares. What's left over and is sold to the public, is called the float or floating supply. Float Charts are all about tracking the floating supply in an attempt to see where the smart money is buying and selling. The gray rectangle on a Float Chart is known as a Float Turnover. It shows the least amount of time it takes for the entire float to change hands once. The total amount of shares traded during the float turnover equals the floating supply. We simply add up the number of shares that traded over a given time frame until it equals a stock's publicly accessible float number. Imagine a stock's price that goes sideways for one float turnover (like the stock below) The idea here is that during the sideways move new ownership has bought the float hoping that the price will move higher. Once the float is accumulated and held tight, any new demand drives the price upward. GMX Resources (GMXR) Here are the comments that I stated in regard its price action: "It just broke out on volume and made a float turnover base in a rising trend formation. In addition, it has excellent days of strength in the background. It got slammed to the downside in yesterday's action, but this type of breakout action often leads to a reversal right back up into new high ground. I see it moving higher in the coming weeks." As you can see from the second chart below, my call was right on the money. It moved up nicely and in the last 60 days it has moved up up 69% and still counting. Who says you can't time the market! STUDY BOTH
CHARTS BELOW Moving On Up!
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INFO ON OUR PREMIER FLOAT CHARTS WEB SITE Want to find stocks like those above? Check Out Steve's New Web Site! Consider subscribing to www.FloatCharts.com. We track Float Turnovers on over 7000 stocks and scan the market for ABC Float Set-Ups, Breakouts and Breakdowns that are poised to make big gains like the one shown above. Our Float Charts Central site is the world's premier site for Float Charts and Float Analysis. We also send out Stock Alerts and a Weekly Newsletter. Check us out! At www.FloatCharts.com we're always on the lookout for trading opportunities like the one above. We currently have a Silver ($30 a month) and a Gold ($75 a month) Package. Visit our homepage and see the results of some recent stock picks (near the bottom). You'll be amazed at the power of Float Charts and the returns our stock picks can generate. Our stock picks are based on the ideas found in Steve's book Float Analysis, Powerful Technical Indicators Using Price and Volume (Wiley, 2002). The book's former title was The Precision Profit Float Indicator (Marketplace Books, 2000). |
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