William O'Neil's investment strategy (CANSLIM: http://www.investors.com/ibd-university/can-slim/) focuses on requiring strict fundamentals, then looking for signs of institutional buying (heavy volume during breakout). It is one of my favorites. I would like to know if the pipeline is robust enough for his fundamental screen, which looks for these qualities:
Each of the last 3 yrs annual earnings are up 25% of previous year’s
Last two Q/Q EPS up 25%
Most recent q/q sales at least 25%
ROE above 20%
Profit in top 20% of industry or above 15%
Example CANSLIM companies (from earlier this year [I discovered them in March]): SUPN, AMAT, WD, HIIQ.
These are quite strict and can be loosened if needed (example: for first requirement, I may allow one down year).
Once I narrow this list, I would also like to know if the technical analysis library can be used to buy stocks when they break through a trading region that has an at least 30% prior uptrend, a maximum depth of 33%, a minimum length of 5 weeks, and a daily breakout volume that is at least 1.5 times that of the 3-month average.
Lastly, I was wondering if it would be possible for me to create my own index of these CANSLIM stocks and use it as a leading indicator of general market direction. William O'Neil claims that these CANSLIM stocks generally lead market behavior.
Any other CANSLIM fans out there interested in helping?