Volume Surge System
Is there anything more satisfying for a trader than capturing a huge breakout? Looking at hundreds of charts for a high volume breakout pattern can be tedious and time consuming but with this system you can scan more than 5000 charts in seconds. The Volume Surge System is designed to detect such breakouts on increasing volume and it will initiate long signals anticipating (hopefully) a sudden and very strong (possibly gap) breakout. The new version filters out stocks with a low probability of a breakout using my custom FVE, VFI and VPN money flow Indicators.
This System is based on my custom VPN Indicator published in the April 2021 issue of “Technical Analysis of Stocks and Commodities” and will detect possible breakouts on higher volume and expanding volatility. In my article I presented a basic system to test the efficacy of the VPN Indicator. This is not, however, the same system but is using volatility and other technical criteria to filter out breakouts with a low probability of success .
The VPN and Volume Surge system performs best on smaller cap stocks and should be applied on daily charts. You can purchase the Amibroker or Metastock versions by selecting the appropriate tab from the menu at the left.
You can see here that in the case of Asensus Medical (ASXC) the system detected a breakout on 1/8/21. The stock was up 43% the next day and more than 200% during the next 6 days.
VPN & VOLUME SURGE PERFORMANCE
This is how the systems performed during the latest tsix year period until February 2023 on all Russel 3000 stocks
To produce the test results I used Amibroker Pro with the following test parameters:
Max. Open positions: 12
Commissions: $0.01 per share
Volume filter: Limit position to 5% of trading volume