Class: Bullish, Day, Continuation, Early

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Bullish

  • Focus on stocks that are in a powerful short-term up trend.
  • Look for stocks that have steady (not choppy) upward price movement.
  • The stocks should not have pulled back more than 5% off of their recent high. Ideally, they have been moving side ways and appear to be resting.
  • The stocks should be above their 20-day moving average.
  • Price increases should be accompanied by higher volume.
  • A nice market rally may help propel these stocks higher.
chart

Day

  • The powerful up trend may lose its steam quickly. Get in, place protective stops and as the stock moves higher, trail the stops higher.
  • If the stock produces nice gains, take partial profits and reduce overnight exposure.
  • Seek small, quick, consistent profits.
  • Exit the trade if the market rallies and the stock does not.
  • Exit the trade if the move does not materialize by the end of the next day, or the stock looks like it is meeting overhead resistance (“heavy”).

 

Part 1 | 2 | 3 more pages...