LON:BAR | Can I CANSLIM? 3 First Sells - What Next?

24th Jul '17 by poughtibridge

10 comments 7485 reads

OK, the portfolio is now slimmed down thanks to selling CVS (LON:CVSG) and Swallowfield (LON:SWL) . Overall, I took a 4.7% hit and both are worth more now than what I sold them for. It is a difficult pill to swallow, but it is the price I have paid to insure against greater losses. It will, however, be quite reasonable for me to purchase these again at a later date if they show a strong base and fulfil the criteria.

So time talk about the remaining portfolio and some prospective buys. Everything in the portfolio is currently suffering a correction, but this means there could be some good buying opportunities coming up.

Fevertree Drinks (LON:FEVR)

Fevertree tonic has been my mixer of choice for a while now, as it is for a growing number of people. It has had a correction in recent weeks, but looks to me like it is in the 8th week of a cup with handle base. I already hold it, but if the handle continues to develop and I see a surge in volume, I will be tempted to add to the portfolio.

597661028ebccScreen_Shot_2017-07-24_at_2

Boohoo.Com (LON:BOO)

As I've said before, I like Boohoo.com - if I was 20 this is where I would shop. Sadly that was a while ago now. It is 7 weeks into a correction, I'm around 17% up on this share, so hanging tight for now - do you think this will develop into a decent base? I like the reasonably tight closes and reduced volume of late. The market seems to be comfortable with its current valuation.

597662a864adfScreen_Shot_2017-07-24_at_2

G4S (LON:GFS)

Maffs0, a keen CANSLIMer brought this to my attention last week (thanks!) - he picked out a 6 week double bottom base that was more clear on the daily chart. O'Neil prefers weekly charts ( as I use in this blog) but Maffs0 points out that " his followers tend to use the daily a lot more". I can see why that is the case - it seems a lot easier to spot…

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aflash

27th Jul '17

I'm up at 5 every day to buy and sell in the financial markets and it is....... work!

I believe in the need for a meaningful occupation but:

enthusiasm decreases as competence increases

there is always more to do than you have time for

results are rarely up to expectations

there is routine

there are repetitive tasks

In fact I believe successful investment is 'boring' because the highs and lows of 'emotional' investment do not bring profits and the calm required when others are in panic, does.

'Love' and 'hate' are strong adjectives in this context. James Montier nailed it, to my mind when he wrote that happiness comes from physical activities, sport,sex, eating and drinking (in any order you like) rather than money.

Tony Robbins and others nail it when they tell us to find positive elements in the present moment, whatever we are doing.

After that it is a question of character and from what you have told us your present line of work requires supervising other people. Maybe that is what you 'hate'.

The only interraction with humans in the financial markets is with the irrational behavious of other investors expressed in prices.

That suits me fine. Management did not. By all accounts and we see it in this blog, you do what you do well. Appreciate that.

The efficiency of every detailed act will produce success, now and in the future.

poughtibridge

Thanks Aflash... I've read your insightful post 5 or 6 times now. I particularly found meaning in the lines "there is always more to do than you have time for" and "The efficiency of every detailed act will produce success, now and in the future." I'll consider it some more.

I didn't mean that I hate my job. I do enjoy my work - I'm lucky I work for a forward thinking company, in a beautiful part of the country. I agree, "hate" is a strong word. But I would prefer not to get up so early as I'm more of a night person. I'd like to be able to pick my children up from school, I'd like to have more time for creativity and learning. I'd like more time to study the market and carry out better analysis for this blog.

Thanks for taking the time to write - I appreciate the thoughts.

Now what about Fevertree? A perfect example of my lack of attention due to time factors - I didn't even spot the interim results coming out the next day!!! Ah, well, at least I had it as an "add"...

In future I think I need to add a disclaimer that I'm "studying CANSLIM" and NOT an expert by any stretch of the imagination, DYOR etc etc!...

ed_miller

31st Jul '17

Hi Poughtibridge - Thanks for sharing your trial with CAN SLIM: useful and interesting to all of us taking a look at it. Regarding the base forming in NMC Health: if that is the handle forming in a cup-with-handle then it looks to be forming in the bottom half of the pattern and, according to O'Neil, is failure prone. Do you not agree? I'd say that could well be the case. Also, it is possible the cup is still forming? ("The formation of the handle area generally takes more than one or two weeks...", p127, ed. 3 - which the chart above does already satisfy though currently it is short.)

I hope you keep posting your progress, thoughts, questions.

Good luck with it and thanks,
Ed Miller

maffs0

I sold out of G4S today as it seemed to be going nowhere and the apparent £3.38 breakout failed.

I have bought a small position in NMC; if you look at the daily chart, the "handle" is in the top half of the cup after all. I bought at the high on Thursday, so waiting for the price to get into profit before thinking about averaging up. I am confident this stock will continue to rise.

I'm also very interested in TET which I have recently topped up significantly. The chart looks like it might be a coiled spring, very tight and low volume. And some great growth fundamentals, failing only one of the CANSLIM-esque tests.

As I mentioned in a previous thread, ARW interests me intensely and is now a full position. It tried to break out decisively today, but fell right back and ended up only up a couple of pennies.

I halved my exposure to FEVR at £22.06 after the results but will look to top up again to a full position when the moving averages catch up!

And as for BOO. This has been my biggest winner in the last couple of years but I got out recently as it fell below the 50 day MA. I'm keen to get back in but need to make sure I wait for the right moment. Emotional attachment to a share is a dangerous thing!

M.

3rd Aug '17

Hi Ed, thanks for your comment - sorry for the delay in getting back - I've been away for a few days. I've zoomed in and had a look, and I interpret it to be in the upper half of the base, although I may be missing something - I am quite new to CANSLIM... This is why I'm grateful when people comment. So, I see 2385 - absolute high, 2058 low point, the depth of the cup is 327 (2385-2058)

This gives me a 50% depth of cup @ 2225. The high of the handle is 2322, above this. It is also above the 10 week moving average line (red), or most of it is...

What do you think - should all the handle be in the upper 50% of the cup? I interpreted, just the start of the handle, but now I'm not so sure!

Thanks for the page reference btw. Very helpful - I will start including references in the posts. I have edition 4, so this info is on page 116.

59832e0e987d0Screen_Shot_2017-08-03_at_1

TET looks great - thanks for sharing - I agree like a coiled spring, low volume, tight prices and with some evidence of large volume weeks in the past. I just ran it through the CAN-SLIM checklist to see why it wasn't on the CAN-SLIMesque at the moment. It passes everything apart from Q on Q EPS growth and being in the too 200 RS stocks, the latter IMO the least important of the criteria.

Thanks for keeping us up to date.

5983316f29508Screen_Shot_2017-08-03_at_1

Fair enough, I agree with you. The close-up looks rather different. Thanks for the comprehensive response. I look forward to the next instalment.

Regards,
Ed

5th Aug '17

The best example I could find of a cup with lower volume on consolidation that also meets 8/9 criteria was ZYT (Zytronic).
It is a bit late to buy.
CLIG meets 8/9 but the pattern is not a cup & handle.
RDSB has a beautiful pattern but fails ROE and others.

Rusty2

How about £CVS and Clipper Logistics (LON:CLG) ?

14th Aug '17

Sorry to have gone quiet for a few weeks... currently sitting with a beer in Spain.

I only have my iPhone so can't really do any meaningful analysis, but just thought I would mention I have bought NMC Health (LON:NMC) based on the performance today. Appreciate this could be a bounce from the poor end to last week following trump's nuclear threats, but it has had a relatively strong bounce compared with other stocks. Currently the price is in line with the top of the handle (as I interpret). Volume up during last two days, although I can't quite see by how much (website is best suited to desktops!)...

Am keeping a close eye on Treatt (LON:TET) as recommended by MAFFS0...

Haven't been able to have a look at £CVS again or Clipper Logistics (LON:CLG), ZYT or RDSB yet but will do. on my return in a week...

Thanks for highlighting...

Can I CANSLIM? 3 First Sells - What Next?

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Poughtibridge

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