martes, 18 de octubre de 2011

Trade like an O’Neil Disciple. Gil Morales & Chris Kacher (I)

The subtitle is "How we made 18.000% in the stock market". It's a book where you can increase the information that you can learn in any book of William O'Neil or reading the famous IBD (Investor Business Daily) paper.
I want to fix some ideas of the book.

1-     The concept of the pocket pivot point. They developed that concept in some choppy markets when the usual breaks fail. Pocket pivot point occurs after a long base with low volatility, low volume, tigher prices near 50 day-moving average or 10 day-moving average depends on the stock. Then the stock pushes up large with a notable volume.
2-     Apart of that concept they also recommend to buy at open some gap-up with volume after a consolidation. Not in a downtrend. Here you should sell if the stock trades below intraday low of the gap-up day or if the stock violates 10 day-moving average. (They make an exception with some less liquid stocks or volatile stocks where you should look at 50-day moving averages.

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