A stock screener is a tool or software that helps investors filter and narrow down a list of stocks based on specific criteria and parameters. Accordingly R-Zone is a wonderful stock screener provided by Define Edge. It screens stocks based on Noiseless charts and its patterns. One of the screener in the R zone is Matrix-Price and RS. In this Matrix-Price and RS scanner there is one subtype of scanner called P & F matrix. After going through Mr. Prashant Shah's You Tube VDO called Price Matrix: Stocks select करनेका एक अनोखा तरीका | Definedge Research | Prashant Shah, I have understood the entire conceptual design of P & F matrix. P& F matrix exactly helps me to find out which stocks in particular segment is showing maximum performance score which is 8. I get double bottom sales levels in those stocks which is also calculated by scanner. But when I go through chart of those script, I find out scripts has appreciably run high. identifying potential investment opportunities in those stocks are already missed out. How to solve this issue?
Nice to know that you have understood the concept of Matrix.
1- A score of 8 indicates that the stock is bullish on multiple timeframes. While there is a possibility that it has run up, that does not mean it cannot go higher. According to my experience, continuation breakouts have a better risk-reward ratio. A trade can be planned in such stocks if there is a pattern with an affordable stop-loss (high pole, double bottom sell, moving average, d smart). I have seen stocks remain in the 7 - 8 score range for months.
2 - You can look for stocks that cross the performance score of 0 - they are turning positive. Stocks crossing the performance score of 4 are the stocks entering into a bullish zone.
Stocks crossing a ranking score of 0 are also potential candidates for reversal.
4- Study sector and segment outperformance along with these scores, your stock selection for continuation and reversal trades will drastically improve.
5 - You can also use the P&F Fusion Matrix table. The score is calculated based on the same method on the relative strength chart as well. It combines both the score and ranks the stocks based on Price & RS multi-timeframe analysis.