Once a week we have been checking the new stock ranking system set up by InvestorsObserver. The new Stock Score Report takes into account both technical and fundamental analysis when raking the overall stock universe that we believes offers a very good indicator of future strength.
The technical analysis is based on both long and short term technical trends, so in order to rank highly, a stock has to have been a solid performer not just in recent weeks, but over the long term. Strong technical trends are a great indicator of where the market believes the stock should be priced, but unless the underlying fundamentals are also strong stocks could easily erase recent gains in a market sell off.
Some traders rely solely on technical trends, but a stocks underlying fundamentals should definitely be taken into account when judging the health of the underlying business.
Combing both screens in a single ranking is a powerful tool, so let’s look at five top ranked stocks in the current screen, and dig a little deeper to see what has been driving the underlying security.