Discover Your Investing Path

A Simple Moving Average (SMA) smooths out daily noise by averaging closing prices over a period. The SMA20 captures short-term trend, SMA50 is the medium-term backbone, and SMA200 defines the long-term direction. When price is above all three — and SMA20 > SMA50 > SMA200 — you have full bullish alignment. This "golden stack" is one of the most reliable momentum signals in technical analysis.

The Relative Strength Index (RSI) measures the speed and magnitude of recent price moves on a 0–100 scale. Above 70 = overbought (price may have moved too far, too fast). Below 30 = oversold (potentially undervalued short-term). But context matters — in a strong uptrend, RSI can stay above 70 for weeks. Don't fade a strong trend just because RSI is high.

MACD (Moving Average Convergence Divergence) compares two exponential moving averages to show momentum shifts. When the MACD line crosses above its signal line, it's a bullish signal. When the histogram (the bars) turns positive and grows, momentum is accelerating upward. MACD is most useful as a confirmation tool — it works best when it agrees with price action and trend direction.

No single indicator is reliable in isolation. The real edge comes from stacking signals that agree: price above SMA200 (trend) + RSI between 50–70 (healthy momentum, not extended) + MACD positive (accelerating). When multiple independent signals point the same way, the probability of a sustained move increases significantly. Our screener's star rating is a signal-stacking score.

The Price-to-Earnings ratio tells you how much investors are paying for $1 of a company's annual earnings. A P/E of 20 means you're paying $20 for every $1 of profit. Higher P/E = higher growth expectations. A company with a P/E of 50 needs to grow earnings rapidly to justify that price. Compare P/E to the company's own historical P/E and its industry peers — not just a single number in isolation.

Earnings Per Share (EPS) is a company's net profit divided by shares outstanding. EPS growth tells you if the business is getting more profitable over time. Rising EPS means the company earns more per share you own — that's what ultimately drives long-term stock price appreciation. Look for consistent EPS growth over multiple years, not just one good quarter.

ROE measures how efficiently management uses shareholder capital to generate profit. ROE = Net Income ÷ Shareholders' Equity. A company with 20%+ ROE sustained over many years is a compounding machine — it generates strong returns on the money shareholders have entrusted to it. Warren Buffett prizes ROE above almost any other metric.

Debt amplifies both gains and losses. A company with high debt can grow faster in good times — but in a downturn, debt payments become a crushing obligation. Debt-to-Equity (D/E) above 2× warrants careful examination. Some industries (banks, utilities) are inherently high-D/E. For most businesses, lower debt means more resilience and more flexibility when opportunity knocks.

Analysts at banks and brokerages publish ratings to help institutional investors. Strong Buy means high conviction. Hold is often a soft negative — in analyst language, Hold frequently means "we can't say sell but we're not excited." Sell ratings are rare because banks don't want to upset corporate clients. Our screener shows the consensus across all covering analysts.

Analysts model a company's future cash flows and arrive at a 12-month price target — the price they think the stock should reach. The consensus target averages these across all covering analysts. The gap between the current price and the consensus target is the "analyst upside." Historically, consensus targets are optimistic — studies show analysts are correct directionally about 60% of the time, but price targets are frequently revised.

We display analyst upside as the percentage gap between the current price and the consensus price target. A large positive upside means analysts collectively think the stock is undervalued. We use this as a supporting signal — not a primary one. A stock with strong technicals AND significant analyst upside gets an extra layer of conviction.

Trust: broad consensus shifts (many analysts all downgrading simultaneously), significant target cuts after an earnings miss, unusual downgrades from analysts with strong track records. Distrust: upgrades on stocks the same bank is underwriting, targets set far in the future with no near-term catalyst, analyst coverage from only 1–2 firms. The bigger the analyst disagreement, the more uncertainty in the stock.

Every single factor — P/E alone, RSI alone, analyst rating alone — generates false positives and false negatives constantly. A low P/E stock might be cheap for a reason (declining business). A high RSI stock might keep running for months. The problem isn't the factor — it's using it in isolation. Academic research consistently shows that combining multiple independent factors dramatically reduces false signals.

Signal stacking means requiring multiple independent signals to agree before acting. Technical signals (SMA alignment, RSI, MACD) + fundamental quality (ROE, earnings growth) + valuation (P/E below median) + analyst sentiment (upside > 15%) = high-conviction setup. The more independent factors that agree, the less likely the setup is a false positive. Independence matters — correlated signals add less value.

Our Combined Screener assigns each stock a conviction tier — STRONG, WATCH, RECOVER, or CAUTIOUS — based on how many positive factors align across technical and fundamental dimensions. More factors = higher conviction = higher priority for research. A stock that scores well on both technical momentum AND fundamental quality is a far more interesting candidate than one that excels on only one dimension.

Even high-conviction setups fail. The solution isn't to lower standards — it's to use watchlists to wait for the right entry. A stock can look excellent on paper but be extended (RSI 80, 30% above its SMA200). Adding it to your watchlist and waiting for a pullback to support levels dramatically improves the risk-reward of your eventual entry. Patience between identification and entry is where professionals separate themselves from amateurs.

Amateur traders place stops at arbitrary percentages ("I'll exit at -8%"). Professionals place stops below logical support levels — the price level at which the trade thesis is definitively invalidated. Common placements: below the recent swing low, below the SMA50, below a key breakout level. If price reaches your stop, the setup you traded no longer exists. Exit without emotion.

Every trade should target at least 2× what you're risking. Risk $500, target $1,000. This means you can be wrong 40% of the time and still be net profitable. At 3:1 R/R, you only need a 33% win rate. Most amateur traders do the opposite — they take small profits quickly and let losses run. Systematically doing the opposite is one of the clearest edges available.

Professional position sizing: Position size = (Account × Risk %) ÷ (Entry − Stop). Example: $50,000 account, 1% risk limit = $500 per trade. Entry at $100, stop at $94 = $6 risk per share. Position size = $500 ÷ $6 = 83 shares. This ensures every trade risks exactly the same dollar amount regardless of price or volatility — creating a consistent, mathematically sound risk model.

Set your target before entry, at a level where sellers are likely to emerge (resistance, prior highs, round numbers). Consider scaling out: sell half at 2× risk, move stop to breakeven, let remainder run toward 3–4× risk. This locks in profit while giving the position room to compound. The biggest gains in a portfolio often come from a small number of positions that were held through volatility.

The same stock bought at different prices produces very different outcomes. High-quality entries reduce risk and maximise R/R. Look for entries near rising SMA support (SMA20 or SMA50 in an uptrend) rather than chasing extended moves. A pullback to a rising moving average in a strong uptrend is often the lowest-risk entry point — close to your stop, far from your target, with trend momentum behind you.

Professionals follow a repeatable process: 1) Screen (screener surfaces candidates) → 2) Research (check fundamentals, news, sector context) → 3) Define the trade (entry trigger, stop placement, target) → 4) Size the position (risk formula) → 5) Enter (patient execution). Skipping any step increases the chance of an impulsive, ill-sized, poorly-timed trade.

Consistency comes from process, not luck. Review your trades weekly: Was the setup valid? (Did I follow my criteria?) Was execution correct? (Correct size, correct stop placement?) Was the outcome within normal distribution? (Even great setups fail — that's expected). Separate process quality from outcome quality. A bad outcome from a good process is data, not a reason to change the process.

A trade journal is your most powerful improvement tool. Record: date, ticker, setup reason, entry/stop/target, position size, actual outcome, and most importantly — what you learned. Over 50–100 trades you'll see patterns: your best setups, your most common mistakes, the times you ignored your rules. The journal turns experience into knowledge. Most traders who journal consistently improve measurably within 3–6 months.