I Tested The Qullamaggie Breakout on Top 100 Gainers—Here's What Happened

Hi all. Today we're discussing another interesting study, this time on Qullamaggie's breakout setup. We completed a strategy overview previously, but here we try to figure out how many Qullamaggie style setups would have been seen in the top 100 biggest gainers of the year, and the data surprised me. For those who don't know, Qullamaggie himself used to do such analysis in what he called the swing trading school during his Twitch streams. He would pick up the biggest winners of the last 6 months and teach the chat participants how to identify his setups. He would often rank setups based on how they looked before the breakout. This video is me doing the same for the top winning stocks of last year. We only discuss five-star setups according to Qullamaggie's measure. Qullamaggie setups have certain non-negotiable characteristics. When all of them come together perfectly, he labels the setup as a five-star setup. Those characteristics are a large move up, typically more than 30% from lows. The best ones have moves in triple digits. Then an orderly consolidation in which the stock surfs the 10, 20, or 50-day EMA. The strongest ones find support on the 10 EMA, strong ones on the 20 EMA, and slow ones on the 50 EMA. The stock makes higher lows during the consolidation. The desirable consolidation period is 2 weeks to 2 months, but that changes in some variations of the setup. The price range tightens as the pattern progresses and gets narrower before the breakout. Many of them have inside days before the breakout. Finally, a range expansion or breakout from the consolidation. The entry happens when the price crosses the trend line, and the stop is placed at the low of the day. In gap ups, the entry happens at the break of opening range highs using the 1, 5, or 60-minute candles. For exits, he suggests taking half or a third in 3 to 5 days and trailing the rest with a close below the 10 EMA. For this study, I improvised the exit to suit the momentum in the stock. For slower-moving stocks with an average daily range or ADR of less than 10%, we exit at the close below 20 EMA. And for faster-moving stocks with an ADR above 10%, we exit at the close below the 10 EMA. Further, we don't do any partial selling. To scan for setups, Collamergy suggests these filters. Stock up at least 30% in 1, 3, and 6-month time frame. An ADR more than 5%. And a daily dollar volume above 10 million. He suggests tweaking the ADR and daily dollar volume in bull markets until you get 50 opportunities for each time frame. He says, "Keep the daily dollar volume equal to 50 times your account size. So, if your account size is $10,000, look for stocks with daily dollar volume of $5 million and above." Once you have the results, you have to go through each charts to find the best setups. In his Swing Trading School sessions, Collamergy labeled several setups as five-star setups. Let's take a look at them first to better understand what we're looking for. Here is APPS from July 2020. He called this setup a five-star setup. In the setup, all the moving averages are upward trending. In the consolidation, the price first bounces off the 20-day EMA, then forms a tight area with higher highs near the 10-day EMA. It breaks out here first, but the price reverses the next day and hits the stop loss placed at the low of the breakout day. That would have been a 1% loss. It then gets narrower again between the 10 and 20 EMA, makes higher highs, and breaks out on high volumes. The risk in the trade was 2%. The exit, if we followed my tweaked method, would have happened at 87% profit. The best thing about the Kalamagous system is that when trades fail, it happens quickly without a significant dent to the account because most stops are placed within 1 to 5% of the entry. At a 25% position size, you're risking 0.25% of your account. However, the major awards come from trades that make you 20 to 50 x your risk, as happened in this setup. Let's take a look at another five-star setup. Here is CELH from June 2020. A massive move of over 200%. An orderly consolidation with the stock surfing the 10 EMA, and a narrowing range ending with this inside candle. The risk was 2.5%. The exit would have happened here when the stock closed below the 20 EMA, and the outcome was a 103% return and a 41 multiple reward on risk. It is because of such trades that Kalamagous says, "If you master just one setup, you'll never have to work a day in your life. You can be your own boss." And if you get really good, you can make a lot of money. Here's another from Kalamagous stable. CVNA from June 2020. A big move of 350% followed by an orderly consolidation with the stock surfing the 20-day EMA. It forms this tight area with three candles, which signifies the narrowing price action before the breakout. This high volume breakout would have had less than a 2% stop loss. The trade would have stopped out at 18% gain, a 9x reward. The stock then set up again on a shorter time frame with the same characteristics with these three super tight candles with less than 1% stop loss. The exit in this case would have been at 65% profit. Although Calamagi asks to look for a minimum of 2 weeks of consolidation, this is a variation of the same setup on a lower time frame. Sometimes it makes sense to take these trades, especially in fast-moving stocks where the risk is very low. Here are a few more setups from 2020 that Calamagi rated as five-star setups. Feel free to pause the video and study them carefully to absorb the characteristics of high-quality trades. Let's now get to the results of our study. In total, I found 58 clean Calamagi style setups among the charts of the top 100 stock market performers over the past year. Nearly 60% of these setups emerged during the 2025 bull market, specifically between July and October. The remaining setups were fairly well distributed across the other months with the notable exception of April and May 2026, when I found very few qualifying setups. One reason I couldn't find many setups in April and June is that market leadership changed after the February to March correction. Since I was analyzing the biggest winners over the past year, many of the stocks on the list had already made their major moves earlier in 2025. The newer market leaders naturally offered more trading setups, which becomes evident when you look at the biggest winners over the past 6 months. By screening for momentum leaders across the 1, 3, and 6-month time frames, you'll continuously identify fresh leaders with new high-quality setups to trade. The average risk on the trades was 3% while the average return was 62%. That's over 20x risk-to-reward ratio. Some of the best performers are listed here. As is always the case, most of these stocks were from the leading themes, including AI, data centers, biotech, precious metals, and semiconductors. Let's now take a look at some examples from the study. Here is ANRO from October 2025. The stock made close to a 100% move from this low, then went into this consolidation. It serves and bounces off the 20 EMA several times before narrowing the range and building this super tight area. As the stock breaks out from the tight area, it gives an opportunity to enter with a 2% risk as the stock was placed at the low of the breakout day. The exit would have happened here above $11 as the stock closed below the 10 EMA when it had an ADR of over 10%. That's a risk-to-reward of 85x. Here is another, GLUE, from September 2025. The stock was up close to 80% from this low when it went into this short tight consolidation. This may not be a full 2-week consolidation, but given how reluctant this stock was to fall, it was hard to ignore. You can see how tight it got when it kissed the rising 10 EMA. The inside candle here was another clue. As the stock broke out, the stop was super tight at 1.5% and it had an ADR of less than 10% and it closed below the 20 EMA here after moving up 135% from the breakout. That's a whopping 90X return on the tiny risk. Here is NESR from October 2025. A 100% move from this low, then this consolidation. The price served the 20 EMA and then got into this tight range. The breakout happened on this day with a stop of 2%. The stock went up 110% before it closed below the 20 EMA, which was the raised stop because its ADR was less than 10%. That's a 55X reward on risk in the trade. Here are more examples from the list with the setups marked along with the entries and exits. Feel free to pause and get a grasp of these. Here is the entire list detailing the month of breakout along with the risk and reward in the trades. This study is of course affected by survivorship bias, but one thing is clear. In good markets, there is an abundance of quality setups to trade. A lot of them fail, but the silver lining is that they fail quickly, meaning losses are well managed and you can foster a great rewards-to-risk foundation. Much of the process comes from muscle memory when identifying trades in a real trading environment. By looking at the 100 winners of the last year, you can improve your future trading performance significantly. If you develop an eye for such setups and have patience with them to show up, you can certainly clock great returns. Kalmar G's impressive annual returns is a sample of what can be achieved. I follow a similar disciplined approach, but use the weekly charts for a more passive style. We also have breakout software and screening tools that help us find the very best stocks at the best moment to deliver positive expectancy. For more, you can watch this video or use the links below to download my free ebook. As always, thanks for watching.