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What to Buy
Symbols in a Rising or Falling trend are best. Symbols in Unsure trends that receive recommendations are "extra signals" (notice on your Scan Report that the program will not calculate many of the items for symbols in an Unsure trend: action is left up to you).
The best signals are Primary signals. Secondary signals are less likely to move in the recommended direction since the trend has already started and the move has begun. In other words, secondary signals are after the fact. These are used to give you a chance to "get in" if you didn't when the primary signal occurred. The MAA on secondary signals is usually lower than those of Primary signals (only consider symbols whose MAA is 75% or better).
When to Open a Position
At the very beginning of a new market direction you should be buying symbols (those with a Buy or Short recommendation and a MAA of 75% or over) that are moving in the same direction..
Wait fifteen minutes after the market has opened to execute an opening order (allows the market to settle).
Make sure the symbol you want to execute an opening order for is moving in the market's direction. For example, you want to buy shares of XYZ. Make sure XYZ is above the previous trading day's price and the market is moving up (ask for a quote on the DJIA). If either of these two conditions are not met, wait until they are. You have three days from the date of the signal to execute the trade. Also, you may execute the order at any time during trading hours after the first fifteen minutes.
Do not try to open the trade after three days from the date of the signal. If the symbol has not moved in three days, it most likely never will.
When to Close a Position
The program will generate a Stop price at the time of the original signal and produce a trailing stop price as the symbol moves in its recommended direction.
The original Stop Price is 3% below the closing price if the trend is Rising and 3% above the closing price if the trend is Falling. Thereafter, the Trailing Stop Price is a seven day moving average if the price moves above the previous high during the duration of the signal.
How it works:
· The general rule is to close out your position if you get two closes in a row. But remember, you receive signals at the end of the day, not during. This means that if you are about to execute a closing order on the following morning after the second close in a row, and the symbol is up, "Why get out?". It's starting to move in your direction again. Call your broker in the morning for a quote, if the price is moving in your direction, "Stay In". If the price is flat or lower, "Get Out".
· If the trend, close the position.
· After a big market move, about 50 to 100 points in the Dow, the market normally reverses the next day. Take profits after a big move regardless of the program's recommendation.
· Do not be a pig. Take profits.
· You must be willing to take a lose. Do not stay in a losing trade and pray that it turns around - it will not!
Flat Market Calculations
This calculation was inserted for just this type of condition. These are alternate calculations that "smooth" the volume by averaging and then running the calculations. Use Flat Market Calculations when you feel that the signals are not good for current market conditions.
Signals are not warranted or guaranteed by T.B.S.P., Inc. and may involve substantial risk - in other words - you could lose your shirt!