| What’s HOT—and What’s NOT |
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| October 23, 2007 |
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“The Dow lost 367 points Friday — the 20th anniversary of the Black Monday crash — as record-high oil prices, more problems in the bank sector and slower corporate earnings growth revived worries about an economic slowdown.” — CNNMoney.com
Feeling jittery are you? What if I told you that I’m immune?
Nope, I’m not living in an alternate universe. Nor do I have super powers.
All I can tell you is that this wave of worry blanketing the market is not stopping my Trending123 subscribers, or I, from taking profits. We took profits on three stocks just yesterday. Significant gains in a short period of time — all while the market remained uneasy.
You see, for us, the news is not something you’ll find in the Business section of the newspaper or on CNBC. The news lies solely in the charts. That’s why the charts are our livelihood.
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Unlock the Secret to the “Knock Down” Pattern
Ever heard about “knock down” patterns? No? Well, then, allow me to enlighten you.
If played correctly, “knock down” patterns can lead to some spectacular profits. As a Trade Talk Weekly reader, you get certain preferential treatment — that means today’s “profit secret” is yours to keep.
So how do you find these special “knock down: patterns? You must follow the rules:
- Look for the market front-runners (the strongest technical stocks in the market.)
- Keep watch as these stocks make new highs…then get knocked down the very next day! (This is a GOOD thing!)
- Be cool. Patiently ride out the knock down for three to four days.
- Now, sit back, relax and ride these stocks to new highs!
Fantastic rewards + quick turnaround = instant gratification. Ah…
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And right now, those same charts are telling me that the rally hasn’t even started. We’re somewhere in the 3rd quarter. The best is yet to come!
Let me rundown a list of some major index sectors. First, we have the bad — note how many fall under this heading. Next, we have the much better indices.
The Bad
- The $BIX (Bank index) stinks. New lows. Bearish trend reversal. Also why the Fed is going to continue dropping rates.
- The OIH (Oil Service Holders). Fantastic for shorts — but that’s it!
- $GOLD has lost its shine! Again, great shorts will come out of this sector but nothing else.
- $NIKK Nikkei — all I can say is “yuck!” I’ve never liked this sector.
- $DRG — Pharmaceuticals are all hype. I’m really stunned that this sector still seems to generate buzz. It’s not even making new highs. Merck? Pfizer? Nothing special!
The Great
- The $DJW (Dow Jones World Index) — broke out to new highs. What’s not to like about that? I’m seeing no bearish divergence whatsoever.
- The $COMPQ (Nasdaq Composite) — we remain above all the important moving averages.
- The $IIX (Internets) — one of the best sectors. It’s a rocking chart.
The Fed’s never done a “one and done”, okay? So what that says to me is that anything that is commodity-related that would be pressured by a rising US dollar or a market-friendly Fed, is just not worth your time—and certainly not your money!
The bottom line is that if it’s not tech-related, then it’s not worth a darn!
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Trade With Discipline
The once-popular song “Tubthumping” by Chumbawumba goes, “I get knocked down, but I get up again.” It’s not about trading, but it could have been—if you trade on emotional whim, you’ll get knocked down. But if you trade with discipline, you’ll pop right back up again, just like the Parabolic Knock-Down Pattern. To achieve this, there are two things you need to do: 1) Establish the rules, and 2) Follow them exactly. Let’s use the Parabolic Knock-Down Pattern as an example.
First, we watch a stock form a base pattern, then go into a parabolic (asymmetrical and curved) breakout to new highs (either 52-week or all-time). The day after the high is hit, the stock will get knocked down in a one-day correction, typically on heavy volume, and after the market closes, we make a note of the day’s low (the knock-down low).
The following day, we wait for the opening trade on the stock. If it opens below the knock-down low, we don’t trade it. But if it opens above the knock-down low, we buy the stock and set a stop loss one cent below the knock-down low.
For a while, the stock will trade between the knock-down low and the last high. As long as it doesn’t hit our stop loss, within five days to two weeks (the longest I’ve seen lasted 20 days), it will break out to new highs. But we don’t get greedy and hope it will keep going up. We sell it, pocket the profit, and wait for the next opportunity to trade with discipline. And it turns out that opportunity is here already! Join Trending123 now to watch your portfolio surge with knock-down trades.
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This market—especially tech stocks—is going SO MUCH higher.
I have been sending out constant profit alerts to my Trending123 subscribers so that they can use that money to buy the next batch of stock picks destined to explode.
My list of these stocks is the juiciest I think I’ve ever seen in my entire life!! Please don’t deprive yourself of the types of life-altering profits I expect from some of these stocks!
Sincerely,
John Lansing
Trending123
P.S. AAPL just hit new all-time highs. What did Trending123-ers do? Collected profits of nearly 33% in just 30 days! Sell high and buy low — that’s our motto. Next stocks up for profits…find out here!
P.P.S. Covering over 4 million chart patterns to find the best trading opportunities — that’s John’s job, not yours. Your only assignment: listen, learn and take profits! Stocks with the potential for “sudden profits”—quick gains of between 10% and 30%—are just the beginning. Click here to discover what Trending123 can do for your portfolio!
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