Market Summary – After a 3 week boost to prices as the Wilshire 5000 broke out of the prior 8 week base, it appears some downside risk is returning to the broad market.
As always, follow the swing trading buy and sell rules to maximize profitability and reduce drawdowns.
Here are the sell rules again:
- Monitor stock price for a close below the 3 period moving average (3 weeks for longer term, 3 days for shorter term trades)
- When the symbol closes the week/day below the 3 period, enter a stop loss order to exit the trade IF the symbol moves below the low of that week/day in future trading.
That’s it, simple rules that provide consistent profits and prevent any small losses from becoming portfolio damaging drawdowns.
Be wary of new trades until the broader market had completed what looks to be the start of a pullback to support areas.
