So you’ve read my charting blog post by now, so here’s step 2!
So now you know the patterns to buy, here’s one in AXP, the wedge.
I bought this one recently, and
So here the buy is above $103, $103.01 (buy limit), and support was $99 ($98.89 stop loss, stop market). So $4 risk also come to 3.88% risk. A little rich for my blood but the chart
(Ie stop loss here is under $99, $98.89). We never buy or sell whole numbers, since all the new investors do that. We want to stay in the trade longer than them!
So the target here for short-term buys, a few days or weeks, is 5:1 risk reward. If I risk $1 I wasn’t to make $5. Since every trade doesnt work, this makes the odds in our favor.
So the original above example was $4 risk so with 5:1 we want to make $20. So if we buy at $103.01, we want to aim to sell at $123.01. A lofty goal!
See how lower risk makes the target more achieveable?!?!
But hey, if you want to hold this guy forever, you can probably take a wider risk. It’s almost
So, good news, you bought at $103.01, and it worked out! Up it went!
So
See how trailing it here with the low, you get stopped out at $106.50, lock in those profits!
For
Once you have this down, use other stops, 1 day low, 2
Some other tips:
Buy stocks above $15 and that have more than 500k average daily volume. I
This will spit out a short list of stocks to look at, use tradingview to find the bull chart pattern, and make a plan!
More tips:
Don’t hold through earnings, unless it’s a 1+ year
Volume and price also tend to contract before a big move. But on the day of the buy, you want a lot!
Take BAND
The Finviz map tool is also cool, it shows you what sectors are hot, dig deeper into those for great buys!
One last thing, the ETF blog touched on quickly, long term holds can go in a regular account for low tax payments, 1+ year holds. Quick trades should be done in a ROTH IRA. No tax! just don’t touch until you retire!
