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Sector vs Stock, scan for negative divergence

Tom Bowley talked about this in this morning's Marketwatchers with respect to understanding a stock's reaction to earnings reports.

He showed a stock (MD - Mednex) that reported earnings as an example: the health care sector in uptrend ($DJUSHP), sector outperforming S&P ($DJUSHP:$SPX) stock is in a downtrend vs it's sector (MD:$DJUSHP), and vs the S&P (MD:$SPX). It's pretty easy to spot the negative divergences on the chart using Price/$SYMBOL:$INDUSTRY, Price/$SYMBOL:$SPX, Price/$INDUSTRY:$SPX and Price/$INDUSTRY Indicators, but I'm wondering if there is a way to build a scan to spot those negative divergences between 1:) $SYMBOL:$INDUSTRY and $INDUSTRY, and 2:) $SYMBOL:$SPX and $INDUSTRY:$SPX

For example, the scan could be useful when run against a chartlist that contains companies that report earnings the next day for example, and could be used for a variety of purposes from trading options to identifying candidates to not hold into earnings, or candidates that may be safe to hold into earnings.

Any thoughts on whether such as scan would be possible would be greatly appreciated.

Comments

  • markdmarkd mod
    edited November 1
    It used to be you couldn't scan for relative strength at all, except using surrogates like ROC().

    It appears that a function has been added recently called Per cent Relative ( PctRelative( ) ) that now allows you to scan for stocks that meet your criteria for over- or under-performance relative to a selected benchmark over a selected period of time.

    I haven't done anything with it so far, so I don't know if it could be used for the purpose you suggest.

    The documentation for the function is here:

    https://stockcharts.com/docs/doku.php?id=scans:functions

    P.S. $DJUSHP is the Health Care Providers industry, not the Health Care sector, for which Stockcharts uses XLV.
  • Thanks for that Mark, I will have a look at that link over the weekend and try some scenarios and see if I can make it work. If I have any luck I'll report back here.
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