One of the most viewed posts on this site is Custom Screens From Mark Minervini’s Trend Templates.
Given the current state of the market, this is an ideal time to revisit the trend templates. What follows are a few quotes from Mark Minervini on his thought process and how he incorporates the templates into his own research routine. The information is based on an interview with Mark that appeared in a previous edition of MarketSmith’s Q1 Stock Guide.
1-Month Trend Template
“The 1-Month Template is sort of a “heads up” screen I developed, where you’re able to see the early turn in a stock as it starts to transition into an uptrend. The 200-day moving average has only been trending for 1 month. That gives some lead time if you start watching and see if it confirms and ends up rolling over to the 5-Month Template.
The other thing, too: high- tight flags, your power play patterns, will sometimes run up very quickly and they don’t give the 5-month template enough time to pick it up. So, you can pick up a lot of high-tight flags in the 1-Month.”
5-Month Trend Template
“The 5-Month Template is my main qualifier. These are stocks that have had their 200-day moving average trending up for at least 5 months. The names that show up on this screen (the ones that have proved themselves to be in a Stage 2 uptrend) are the ones I watch closely and consider buying, but only if they emerge from a constructive base.”
If you’re not familiar with how to use the trend templates within MarketSmith, visit the link mentioned at the top of the post, where I walk through how to setup and configure a screen using Mark’s templates to narrow the universe of stocks to search.