Why TRADE with the TREND?

  – 98% of big winning stock made the largest portion in their gain in initial uptrend 

– Evidence that institutions are buying

– Increase probability of success

– Know what to expect under specific conditions

NOTE – Your goal is not to buy at the lowest price – It’s to buy at the right price

Trend Template to Confirm Uptrend

1. Stock price is above both the 150-day (30-week) and the 200-day (40-week) moving average price lines.

2. The 150-day moving average is above the 200-day moving average.

3. The 200-day moving average line is trending up for at least 1-month (preferably 4-5 months minimum).

4. The 50-day (10-week moving average) is above both the 150-day and the 200-day moving averages.

5. The current stock price is at least 25% above its 52-week low. (Many of the best selections will be 100%, 300% or even greater above their 52-week low before they emerge from a sound consolidation period and mount a large-scale advance).

6. The current stock price is within at least 25% of its 52-week high (the closer to a new high the better).

7. The RSI relative strength ranking (as reported in Investor’s Business Daily) is no less than 70, but preferably in the 90s, which will generally be the case with the better selections.

8. Current price is trading above the 50-day moving average (exception “Low Cheat” setups).

Note: the Relative Strength (RS) line should not be in a strong downtrend – I like to see the RS line in an uptrend for at least 6 weeks, preferably 13 weeks or more.