IBD placed the market back into confirmed rally from market under pressure. When ever the NASDAQ or S&P500 close at a new high a failsafe mechanism forces the market back into rally mode. When reviewing stocks for building a watch list I found the bulk of the stocks too far extended confirming the market rally. When the market is rallying taking new short positions is not advised. I create short watch lists however to help monitor the market leaders. For the same reason I create long side watch lists in bear markets even though one should be extra careful about wading in on the long side in bear markets.

Something rolling around in my head is how Ed Seykota trades. Ed is perhaps the all-time best trend trader in history. A visitor asked to visit his trading room and was shocked to not see display monitors with quotes and charts. What some don't know is that Ed doesn't look at the market during the trading day at all and uses end-of-day data only. He places buy and sell stop orders after the market closes based on his end of day view which of course could trigger the next day on real-time data at the broker. His total focus is on identifying market direction and candidate instruments that are in a trend, buy or short them and to ride the trend to the end with protective stops to preserve capital.

I know of a CANSLIM trader who very much has moved in this direction. He has zero discretionary input into his trades. All stop orders are placed when the market is closed. He went in this direction because he learned that when he allows himself to use his discretion he can't make money.