With thousands of stocks to choose from, finding stock market leaders can seem like searching for the proverbial needle in a haystack. But what if you could use a metal detector to help you locate stocks like NVIDIA (NVDA)? Or better yet, how about the next big winner beyond Nvidia stock?
Scott St. Clair, IBD Premium Products Group Manager, joined the "Investing With IBD" podcast to discuss the launch of Market increase. In the spirit of IBD founder William O'Neil, MarketSurge charts combine sensing technology with the most relevant information, all in one place. The goal? Helping investors find the best stocks, make better decisions, and ultimately make more money in the stock market.
St. Clair shared the latest updates to the MarketSurge platform and, as an active trader, how he uses it to improve his trading results. "I'm not just the manager, I'm also a customer," he joked.
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Audio version of the podcast episode
Nvidia Stock and Earnings, Earnings, Earnings
MarketSurge is the rebranded version of MarketSmith, IBD's advanced charting platform. Some long-time members of the IBD community may even remember its initial incarnation as Daily Graphs. But the launch of MarketSurge offers more than just a new name and color change.
Real estate investors always talk about location, location, location. For stock investors, the best analogy is probably profits, profits, profits.
St. Clair uses Nvidia stock as an example when presenting new earnings information added to the platform. Your favorite addition? "For me, without a doubt, it's the Income Line," St. Clair said.
The Earnings Line takes four trailing quarters of earnings per share figures and graphs them over time. It makes it very easy to see the acceleration and deceleration of earnings growth and subsequent price reactions.
In the case of Nvidia stock, St. Clair points out how the earnings line peaked in 2022, after the price did, and then bottomed in 2023. Again, after the price did.
In addition to the Results Line, more data is available on the fundamental side. EPS percentage calculations have been added to the yearly figures on the weekly chart. Additionally, MarketSurge now has four quarters of forward earnings and revenue estimates using FactSet data. The fact that everything is there on the price chart makes it easy to quickly evaluate the stock.
Are the ants marching?
For those familiar with three-time US investment champion David Ryan, you may have heard him reference an Ants indicator. Some stocks show amazing strength, and when David Ryan worked for William O'Neil, he helped develop an indicator to identify such stocks. Includes criteria such as:
- 12 positive days in a final period of 15 days.
- Increased volume that is 20% to 25% above average.
- A price increase of more than 20% during that same 15-day period.
St. Clair showed how to access a list of stocks that meet the Ants indicator criteria. The indicator received the internal nickname "ants" because the small marks on the chart look like little black ants, especially when several signals repeat. Since the indicator uses daily signals, it can only be found on daily charts.
The Ants indicator can put stocks showing power on your radar. Even if they are extended at that time, they can remain on your watchlist while you patiently wait for another opportunity. And big stock market leaders often offer multiple buying opportunities.
St. Clair also shared that the indicator can alert you to climate action as it recently did for super microcomputer (SMCI).
One might wonder if similar "ants" might start to appear in Nvidia stock, as its stock looks like a parabolic move.
A smarter volume number
St. Clair also explained how MarketSurge's intraday volume percentage change calculation got a big improvement. Previously, the calculation would use the intraday volume compared to the 50-day average daily volume divided by the amount of time elapsed in the trading session. It's a good theoretical calculation, assuming the volume came at a constant rate throughout the day. But that is not the case in reality.
Take Nvidia stock. With an average volume of 48.7 million shares per day, approximately 7.5 million shares would be expected to be traded in the first hour. That is, if it were distributed evenly throughout the day.
When it traded more than 11.8 million shares in the first hour of trading on March 7, the old calculation would show volume trading 60% above average. But the new calculation compares Nvidia shares that actually traded in the first hour of the last 50 days, it's not an approximation. That was closer to 20% above average.
Finding the next Amazon of...
St. Clair concluded with an analysis of a couple of stocks that could be next Amazon (AMZN) in their respective countries. He often looks at international markets.
"I'm always drawn to stock analogs. South Africa's Amazon, Latin America's Amazon or white spaces," St. Clair said.
Carry Mar Ltd. (HE). St. Clair considers this the Amazon of Singapore. Part of the appeal was that it was a stock he had previously traded successfully. More importantly, he noted that the short-term three-month relative strength rating came out much higher than the long-term ratings. He told her that something was changing in the action. These are easily found in the technical analysis tab of MarketSurge.
On the negative side, there is a lot of general offer. After all, Sea stock fell a whopping 90% from its October 2021 peak to its January 2024 low. But with the changes in relative strength and the move above the 40-week moving average, even a recovery partial could be lucrative.
On the newer side, St. Clair also looked at cupang (CPG), which is referred to as the Amazon of South Korea. It is a newer name, with its initial public offering on the New York Stock Exchange in 2021. But it is well established and dominant in South Korea.
St. Clair noted that both Sea and Coupang have significantly ascending profit lines, having recently gone from posting quarterly losses to quarterly profits.
Whether you're looking for the next Nvidia or Amazon stock, St. Clair says MarketSurge can help make that needle in the haystack much easier to find.
To try MarketSurge for yourself, sign up for a Try MarketSurge here.
Follow Justin Nielsen on X, formerly known as Twitter, at @IBD_JNielsen.
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