A Darvas Study

Nicholas Darvas was the author of the famous trading book, "How I Made $2,000,000 in the Stock Market. 

The idea was to pick strong stocks, which he wanted to have doubled from their lows.   Darvas drew boxes around those stock charts while they were in consolidation. These boxes are now called Darvas boxes.  The Darvas method works just as well today as it did in his day. It has has attracted a large following. 

Some have suggested that the Darvas method may be summed up as follows: 

D – Direction of the Market
A – Accelerated Earnings and Sales
R – Relative Price Strength (and Return on Equity)
V – Volume Increasing
A – Aggressive Growth Group
S – Sound Base Pattern

 In any event, I wanted to run through what a Darvas stock might look like.  I came across PLNR.

Here's PLNR which got a big move after earnings.  It has now setup as it has formed a nice base after these earnings..  I drew the "Darvas box" around the highs.  But we also want to see earnings growth, a volume surge, and a low cap /  float.   PLNR meets all these requirements in my opinion.