- Stop placement
- Don’t place stops at round numbers (which are common support / resistance zones).
- Place stops below support zones (above resistance zones) to give price every opportunity to move in desired direction.
- Trade with the trend
- Select stocks that are moving with the general market and industry trends.
- Enter on breakouts near the yearly high
- Breakouts from chart patterns within a third of the yearly high perform best (statistically). If price doesn’t rise within a few days, consider selling immediately.
- Exit only on expected significant price turns
- Don’t be so quick to sell. Learn to predict significant price turns.
- Use trendlines as sell signals
- If prices are trending up and then drop below a trendline, the trend isn’t up any longer. However it doesn’t mean that the trend is down.
- Victor Sperandeo’s criteria to determine if a trend has changed from up to down: (i) price drops below an up-sloping trendline, (ii) lower high (or failed breakout), (iii) lower low.
- Ignore news
- Don’t believe scenarios spun by news outlets.
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