Zacks.com featured expert Kevin Matras highlights: Micrus Endovascular, Mothers Work, AAR Corp, Nuveen NY Invt and Meritage Homes.CHICAGO -- Kevin Matras looks at how to use Price and Volume for locking in profits, cutting losses and spotting potential trend changes. Stocks in this week's article are Micrus Endovascular Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : MEND), Mothers Work, Inc. (NASDAQ: MWRK), AAR Corporation AAR Corporation NYSE: AIR is a large American aviation engineering company. Founded in 1951, the company has its headquarters in Wood Dale, Illinois, a Chicago suburb near O'Hare International Airport. (NYSE NYSE See: New York Stock Exchange : AIR), Nuveen NY Invt (NYSE: NQN NQN Not Quite Nigella (blog; notquitenigella.com) ) and Meritage Homes Corporation Meritage Homes Corporation is an American real-estate development company that constructs single-family homes across the country and active adult communities in Arizona [1]. It is headquartered in Scottsdale, Arizona, and is a publicly traded company (NYSE: MTH). (NYSE: MTH mth abbr (= month) → m mth abbr (= month) → m mth abbr (= month) → m ). Click here for the full story exclusively on Zacks.com: http://at.zacks.com/?id=109 Screen of the Week written by Kevin Matras of Zacks Investment Research Zacks Investment Research A firm that compiles earnings estimates and brokerage firm investment recommendations for thousands of publicly traded firms. : Last month, I published a screen to find winning stocks with upward price momentum amid heavier trading activity (bullish Bullish Word used to describe an investor's attitude. Bullish refers to an optimistic outlook, while bearish means a pessimistic outlook. bullish ). This week, I want to revisit re·vis·it tr.v. re·vis·it·ed, re·vis·it·ing, re·vis·its To visit again. n. A second or repeated visit. re this idea, but with a different spin. I'm talking I'm Talking was a 1980s Australian funk-pop rock band, noted for launching vocalist Kate Ceberano. History After the break-up of the Melbourne-based experimental funk band Essendon Airport in 1983, members Robert Goodge (guitar), Ian Cox (saxophone) and Barbara Hogarth about using price and volume to know when to pull profits and cut your losses. Look at your stocks. Are they moving convincingly higher on growing volume? Or are they marking higher prices on diminishing volume? (Or are your stocks moving lower on increased volume? If this is the case, keep reading as this will be covered too.) This is important since volume is supposed to follow price. If the stocks on your radar are moving higher, but without greater investor interest, it can often mean a pullback Pullback A falling back of a price from its peak. This type of price movement might be seen as a brief reversal of the prevailing upward trend, signaling a slight pause in upward momentum. is in the near offing. (Or if it's moving lower as volume increases, it could signal there's more downside Downside The dollar amount by which the market or a stock has the potential to fall. Notes: You might hear someone say that the downside on stock XYZ is $10. What that means is that the stock could fall by this amount if things got bad. to come as people are exiting their long positions or even getting short.) The more buying pressure there is, the higher it'll go. But once the buying pressure eases up, it often means a pullback is in store. The pullback can be an ordinary retracement Retracement A reversal in the movement of a stock's price, countering the prevailing trend.  Notes: An example might be market risk causing a stock's price to pull back. as new buyers catch their breath or it could be a trend-changing event. As for downside pressure, it's pretty much the same thing. Wherever the pressure is (volume), prices have a tendency to follow. So pay attention to what the volume is telling you and be alert. A screen for helping you weed out the weak from the strong can be as simple as looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. three days (or more) of higher prices with each day registering less buying pressure (lower volume). The parameters are: Recent Price greater than Price 1 Day Ago (Recent greater than Recent-1D) Price 1 Day Ago greater than Price 2 Days Ago (Recent-1D greater than Recent-2D) Price 2 Days Ago greater than Price 3 Days Ago (Recent-2D greater than Recent-3D) Recent Volume less than Volume 1 Day Ago (Recent less than Recent-1D) Volume 1 Day Ago less than Volume 2 Days Ago (Recent-1D less than Recent-2D) Volume 2 Days Ago less than Volume 3 Days Ago (Recent-2D less than Recent-3D) Here are two that fit this criteria (for the week of 6/5/06); MEND Micrus Endovascular Corp. MWRK Mothers Work Inc. (This screen is available in the Research Wizard. The name of the screen is called; sow_3days up pr and 3 dwn vol) There are many more stocks that appear on that list too. If your stocks show up on it, pay close attention. They could be in store for a direction change. You can also look for three days down (or unchanged) with increasing volume. Lots of action with no upside Upside The potential dollar amount by which the market or a stock could rise. Notes: This is basically an educated guess on how high a stock could go in the near future. See also: Bull, Downside progress can often be a sign of distribution (people selling off their stock), or people getting short. The parameters are: Recent Price less than or equal to Price 1 Day Ago (Recent less than or equal to Recent-1D) Price 1 Day Ago less than or equal to Price 2 Days Ago (Recent-1D less than or equal to Recent-2D) Price 2 Days Ago less than or equal to Price 3 Days Ago (Recent-2D less than or equal to Recent-3D) Recent Volume greater than Volume 1 Day Ago (Recent greater than Recent-1D) Volume 1 Day Ago greater than Volume 2 Days Ago (Recent-1D greater than Recent-2D) Volume 2 Days Ago greater than Volume 3 Days Ago (Recent-2D greater than Recent-3D) Here are two that fit this example (for the week of 6/5/06); AIR AAR Corporation NQN Nuveen NY Invt (This screen is also available in the Research Wizard. The name of the screen is called; sow_3days dwn pr and 3 up vol) You may even want to check for stocks with big price drops on much larger than average volume. If the price falls by 8%, for instance, on 20% more volume than average, that can also be a signal that things may be changing. Again, since volume in general should follow the price, a big price drop on increasing volume could be foreshadowing fore·shad·ow tr.v. fore·shad·owed, fore·shad·ow·ing, fore·shad·ows To present an indication or a suggestion of beforehand; presage. fore·shad even lower prices to come. The parameters are: Recent Price less than -8% from Price 1 Day Ago (Recent less than .92* Recent-1D) Recent Daily Volume greater than or equal to 1.2x (20%) 20 Day Average Volume Such as: (for the week of 6/5/06); MTH Meritage Homes Corp. (This strategy is easy to create in the Research Wizard.) There are many other ways to use price and volume as an indicator of a stock's future direction. But by simply applying these screens to your stocks, you could keep yourself out of 'suckers rallies', exit major tops sooner, lock in hard earned profits, or exit losers before they get bigger. These strategies and many more come loaded with the program. See for yourself and put your own stocks to the test. Historical daily volumes (and even prices) aren't available in all screeners, but they are available in the Research Wizard. (Not to mention 650 other items too). Sign up now for your two-week FREE trial to the Research Wizard and see how easy it is to make better trading decisions today. http://at.zacks.com/?id=111 Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. About Screen of the Week Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use. Each week, Zacks Profit from the Pros free email newsletter shares a new screening strategy. Learn more about it here http://at.zacks.com/?id=112 About Zacks Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform Outperform An analyst recommendation meaning a stock is expected to do slightly better than the market return. Notes: Exact definitions vary by brokerage, but in general this rating is better than neutral and worse than buy or strong buy. the market by nearly a 3 to 1 margin. 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