When I follow your suggestions and make a purchase (as in PLC & IFMX), & no follow-up mention is made from you, should I just sit & wait or what? (February 12, 2001)
As there are many times to take positions on a stock that is moving up, so setting stating sell points is not as easy. First and foremost, we don't enter a positions unless it hits our buy point on the volume we want. If we take an aggressive position, i.e., before the breakout move, we need to be ready to cut and run if it turns against us or sells down 7% or 8%; that is the price of playing an aggressive position. If a stock hits a buy point but then stalls, as long as it holds above the buy point that is fine. We are on alert, however, that it has stopped moving and thus are ready to get out if it starts to fall below the buy point. If it makes a move but then returns to the pattern, while that is not the best sign for a move back up, if the pattern holds on and it continues to show decent price/volume action, we will give the pattern a benefit of the doubt to continue to work toward a solid break to the upside. If the pattern breaks down, we get out immediately as the reason for following the stock is no longer there. Patterns give you an edge over just picking a stock, and if it stops working, it is time to move on.
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