Before the Breakout: Why AUGO Was Already on My Radar
Strong group. Explosive fundamentals. Great price and volume.
Big move today in metals and miners.
One of the stocks I mentioned in the Big Picture two weeks ago was AUGO. Why did I mention it?
First, since the July 29 lows, we have seen strength in metals and miners, along with many of the groups that led in April and May.
Next, AUGO had triple-digit earnings growth, double-digit sales growth, rapidly growing fund ownership, a one-year Relative Strength Rating of 95, and strong relative strength across the shorter time frames. It was also a name I was watching back in 2025 when metals and miners were performing extremely well.
Combine that with a powerful earnings gap above all its key moving averages, followed by a strong run higher and then a tight consolidation lasting a little over a week. Price found support at the 10-day moving average while volume dried up.
Today, volume rapidly came into the stock. AUGO cleared the consolidation high near $80 at the open and then triggered an opening range breakout around $81.22. Using the low of the day near $79.70 as the stop allowed the trade to be executed with less than 2% risk.
When a breakout through a prior high aligns with an opening range breakout, it can create a much higher-quality setup with a precise entry and tightly defined risk.
We identified a strong industry group within a supportive market environment. Then we found one of the strongest stocks in that group. We looked for great earnings and sales growth, excellent pretax margins and ROE, and textbook price and volume action.
The sequence was clear: a powerful move higher on heavy volume, volume drying up as price consolidated tightly, and then massive volume coming into the stock as it broke out today.
This is a great demonstration of how we use the MTS Velocity trading software to identify growth stock candidates and then apply the setups we teach in the MTS Course. These principles have been used by some of the world’s most successful growth and momentum traders, including William O’Neil, Mark Minervini, Dan Zanger, and Kristjan Kullamägi.
