52 week high and low may used as support and resistance level by some traders.
Traders also use near the high or the low end of its 52-week price range.
calculate the “percentage off the 52-week high,” from 52 week low.
How to calculate the 52-week high
current stock price – 52 week high /10
strategy 1 52 week high momentum
- find the 52 week high stocks by screeners any website like ticket tape, screener trading view etc
- pick 10 stocks 10%, each or 20 stocks 5% each or 3% each 33 stocks 2% each 50 stocks (3-5 is allocation is good)
- expect 55% of stock doesn’t perform well. works better in bull trend.
- Stock price should be above 200 & 100 EMA
weekly or monthly check the price if it goes to below 200 exit.. and add new
strategy 2 52 week high moving average crossover strategy.
Buy 50 EMA crosses above 200 day moving Average,
Sell 200 EMA crosses below 50 day EMA.
strategy 3 52week high +/ 10 days
buy: when 52 week high sets a new 10 day high.
sell: when 52 week high sets a new 10 day low
52 week high vs all time High
all time high considered good when compared to 52 week high.
52 week highs and all time highs strategy
volume indicator: to filter out penny tocks an for liquidity.
momentum indicator: to spot the weakness in momentum. trend direction & volatility.
thought’s:
is 52 week high after base formation ( flags, pennants, rounding bottoms, inverted head and shoulders, range bound movements and subsequent breakouts, double bottoms, triple bottoms, triangular or rectangular consolidations etc.)
stock hits 52 week high and revers and consolidate for breakout.. pull back not below 50,200 dma
check for Sector stocks also high, strong breakout from multiyear correction.
where to screen 52 week high stocks?
Screener.in is best try trading view stockedge etc.
Fundamentals to consider
adding fundamentals reduce risk.
all time high profits, all time high sales, breakout from consolidation, adding more filters narrow the result.
exit strategies
20/50/100 day EMA
200 day moving average
any Momentum indicator (RSI, macd, super trend, atr trailing stop loss, Bollinger band etc)
after 1 week/ month consolidation check whether its for overall market or stock specific reason.
Conclusion: Lot of trades define their own 52 week high strategy by adding more filters.. you can back test and test and try.. people feel that these stocks have run up so much and hence have lost a lot of value. this is not a buy and forget kind of strategy
https://www.bauer.uh.edu/tgeorge/papers/gh4-paper.pdf
