Shawn I use the 50-day entry method (such as the EOG example) more often than the 10-day moving average entry. I prefer these entries over classic breakout entries which have become perhaps too obvious. I don't have a tally of how much of my portfolio is usually filled with alternate entries vs. classic but more than 50% seems right. I pay strict attention to executing these alternate entries at a price very close to the moving average and don't chase. I would rather wait for another opportunity than chase. The initial setting for volume alert triggers will be 0-5% above the moving average, 5% is wider than I will normally execute a trade but it places it on my radar screen to wait for developments in the case it is extended. Not all volume trigger alerts should be bought, instead they should be inspected to determine if the opportunity warrants an entry. What I want to see in a "perfect" 50-day setup is the following (not every opportunity will meet all criteria):
1. A stock that I want to own setting up in a constructive basing pattern.
2. Price bouncing off of or coming up through the 50-day moving average.
3. Really obvious volume, not just minimum.
3. 50-day moving average rising.
4. Execution price within 2% of the 50-day moving average.
5. Confluence of multiple moving averages just below price.
A perfect 10-day moving average entry will have many of the traits above and show an orderly pull back to the 10-day with light volume followed by a large volume move up. The characteristics of the pull back might well resemble the shape of a sound handle of a cup with handle pattern. Some stocks are bought in the handle area using this method.
Originally Posted by mscott
Shawn I use the 50-day entry method (such as the EOG example) more often than the 10-day moving average entry. I prefer these entries over classic breakout entries which have become perhaps too obvious. I don't have a tally of how much of my portfolio is usually filled with alternate entries vs. classic but more than 50% seems right. I pay strict attention to executing these alternate entries at a price very close to the moving average and don't chase. I would rather wait for another opportunity than chase. The initial setting for volume alert triggers will be 0-5% above the moving average, 5% is wider than I will normally execute a trade but it places it on my radar screen to wait for developments in the case it is extended. Not all volume trigger alerts should be bought, instead they should be inspected to determine if the opportunity warrants an entry. What I want to see in a "perfect" 50-day setup is the following (not every opportunity will meet all criteria):
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