Hot Stocks Q&A View Select Entries from Our Mailbag. Also See Our Q&A Page.Q: Hi GSA: Question, there are too many hot stocks (leader stocks) out there; but why is your Top Stock Pick not a hot stock coming out from another advance. I know one has to look at a sound chart base, technical, fundamental factors, and so on. However, there are some top leaders such as coh, mtlg, bcgi, chs, stst, that just broke out today from their base on base patterns, and could be considered hot stocks. Some broke out from their correction, and some broke out from their handle, they still have a lot of potential to break out for another huge advance...syno, appx, lf, and so on seem like breaking out and ready to take another ride of rising prices. Could you tell me what made you so confident with your top stock picks such as heph, mrge, talk which are not all hot leaders and some even have weak fundamentals. Thank you very much and thanks again for your top stock picks.
From a learning investor.
A: Hi,
A few general comments - we define "hot stocks" as stocks that have a high GSA rank in our database. So our definition of hot stocks may be a little different from what you are referring to. Let's go through your list of hot stocks and here are our comments as to why we didn't post any of these stocks as Top Stock Picks:
COH: Small 6 week base breakout. We like to see 8 weeks mimimum basing period.
MTLG: Not in our database.
BCGI: We were going to post this as a Top Stock Pick today, but didn't like the A/D rank - C.
CHS: B+ ranking, A/D rank C.
STST: Small 4 week base breakout.
SYNO: B+ ranking, overvalued, small base breakout.
APPX: Small 6 week base breakout. We still hold APPX in our portfolio, since it is a recent pick.
HEPH, MRGE, TALK: Even though their fundamentals may not have been steller, they all had outstanding chart patterns, and a high GSA Rank, which are the factors we depend on most.
The base on top of a base that you mention is a great chart pattern - we just want to see slightly longer base periods before buying.
Hope we've convinced you on our "hot stocks" buying strategy.
Best Regards,
GSA
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