For those unfamiliar with W%R, it’s a momentum indicator that identifies overbought and oversold conditions.  A reading of 80% to 100% indicates an oversold condition.  A reading of 0% to 20% indicates an overbought condition.  Couple this indicator with Bollinger Bands, which can identify when a trend reversal is near, and you now possess the ultimate turnaround signals.

Here’s an example.

For five straight days, shares of Cummins Inc. (CMI) did nothing but rise. 

Fortunately for Extreme Volatility Speculator (EVS) readers, as soon as the W%R peaked and reversed course and the stock blew through its upper Bollinger Band, it was time to go short with puts.

In the early trading hours of Tuesday, October 10, 2006, shares of CMI ran north of $137, a $3+ gain after five straight days of gains.  EVS knew the turnaround was coming, given the W%R and Bollinger Band reads, and quickly issued a buy on the $2 December 120 puts at 10:30 a.m. ET.

By 2 p.m. EST, shares of CMI gave back all of its gains, plus another $1.80 on the day, tacking on 90 cents to the $2 calls -- a 45% gain in just hours. 

To learn more about the Gressor investing system, access this special report from Ian and the Gressor team.

Copyright 2006, The Taipan Group, LLC, Taipan Financial News, GRESSOR, Extreme Volatility Speculator, and Dynamic Market Alert,
808 St. Paul St., Baltimore, MD 21202. All rights reserved. No part of this report may be reproduced or placed on any electronic medium without written permission from the publisher. Information contained herein is obtained from sources believed to be reliable, but its accuracy cannot be guaranteed.