To: bajasurf who wrote (3081 ) 8/19/1999 9:32:00 AM From: David Lind Respond to
Randie, I focus only on stocks with upward momentum that are taking a momentary breather, as per Elder's technique. I look for upward weekly momentum, with a daily stochastic below 20, but now trending up. Then I move to five minute charts on my target day, and wait for stochastic to fall into the lower ranges. When I have been impatient and gotten in early, I have been sorry. But when I have waited for the indicators to scream BUY, I have been rewarded nicely. One good trade a day is all that is needed. And I check that the OVERALL market is flat or uptrending, and not falling away. I think this is a crucial issue that is often overlooked in many trading texts. At that moment, I find that the stock usually has excellent potential for an upside move. I am still dealing with the issue of exit strategy, but my best results so far have been an initial stop at a comfortable safety level, and a trailing stop as potential profits are seen. Because in this market it is impossible to set a price target and not go crazy watching the price action. As an example, three days ago GE was an excellent Elder candidate in my book. (Eric, I am not selling GE, just using an example!) Check the charts for yourself. Weekly momentum, and daily stochastic. As the stock rose 1.5 points, I moved my stop up accordingly. 36 hours later I got stopped out with a 1.5 point gain, and who can complain? If the market looks decent after Monday, I would not hesitate to enter again because it still looks like an excellent candidate based on Elders triple screen. IMHO, this approach works as well as anything I have seen to date, and a few of us who have been corresponding would enjoy hearing from anyone else on this thread who has experience with the same approach.
