The Outperformers

December 1, 2021

We debuted a new scan recently- The Outperformers.

The Outperformers is our newest scan that pinpoints the very best stocks in the market. It’s the fastest, easiest way to find quality names that are primed for major moves.

The goal is that as the market rally progresses, the sector rotation within the market will reflect in this scan. So while our Top/Down Analysis helps us with the broader view of the market, this Bottom/Up scan makes sure that we catch the slightest change in sentiment.

Here is the list of The Outperformers that we sorted by way of relative strength. These stocks have been selected on the basis of inter-, and intra- sectoral performances. So while these belong to the sectors that are outperforming the market, these stocks are also outperforming their peers within the same sector.

Click on chart to enlarge view.

In our last post, we looked at Larsen & Toubro.

Let's take a look at this week's scan selection.

The Power sector has been in and out of strength over the past few weeks. What we have as of today, are monthly charts!

When this happens, we like to get a monthly confirmation on the trend that we are tracking and take the idea forward from there.

One of the stocks that stands out from a monthly perspective among the major names, is Power Grid. In a market such as the one we've seen over the past month, we got a bullish engulfing candlestick pattern. In addition to it being a bullish candlestick, the closing price is close to the high. Another great sign!

For almost half a year the price has been struggling to cross 190. However, in the latter part of that struggle, the price has remained above its Fibonacci retracement level. And that's our next good sign. We like to see the price consolidate above a crucial level (in case of a bullish stance). This shows that the demand for the stock is present at those levels.

The third factor that works in favour of Power Grid is relative strength. At a time when most stocks are struggling to hold on to their support levels, Power Grid is displaying strength. That's relative strength right there. You don't even need to look at a ratio chart for that!

We are bullish above the level of 190, with a target close to 263.

It is imperative to mention that one must keep a close watch on the risk management levels in today's market. Did the market cut you out? No problem, you get into the game again. But if you lose your capital in the trade beyond the risk management level, then that one's on you!