Their algorithm at the scam, er I mean scan, site can be condensed down to an old phrase, "the trend is your friend." It merely seeks to grab onto a trending stock. Lotsa sources for those kind of scans, almost all free. Sheesh, even the great (cough, cough) Cramer highlights best of breed stocks, and you can always just buy an Investors Daily (do they still publish that?) and buy the top 1 of their top 100. There's a few killer algorithms out there, but you can rest assured that every one of them is as closely guarded a secret as the formula for CocaCola. I got a feelin' the one they're selling ain't one of them. A scanner that will pick tomorrow's winners based on an algorithm that will work in a dynamic market moved by a myriad of factors, including unlikely and unforseen events. I think they call that a crystal ball.
And then what, short the stock? It's very rare for this kind of momentum to continue. Portfolio123 can do all the end of day stuff, and it can include an exit strategy to actually determine returns. They have a free 30 day trial. Using a close greater than average of the hi and low instead of greater than the 5 hour average, along with the other entry rules, a one week hold time, selecting 10 stocks at random that meet this criteria yields an annualized return of 1% over the past 2 years, and that is before slippage and commissions which will make this strategy a big loser. Surely there are better exits but with an entry strategy that is much worse than random I don't think there is any fixing this.
..... using that system of moving avgs is very similar(if im not mistaken) to the so called "alligator moving avg" system correct me if Im wrong ppl bcuz its based on moving avgs(which are LAGGING INDICATORS), it is prone to fake outs in ranging markets, so use with caution. A way to better use this system is when it offers a buy/sell trading signal off of a major s&r level