Of course this will change, things will be added, and some things will be taken away. That is just how things work. However, this is my strategy, edge, and process on a very basic, preliminary level right now. Enjoy, and MAKE YOUR OWN.
This is my process:
My stock picking is simple. There are two scenarios in which I will focus on.
Market/Majority of Stocks in a grinding uptrend –
— In this case I will take breakout trades as I find them as they will have a higher probability of success relative to mean reversion.
— Scale out half on the breakout, leave the rest as a trailer/swing versus the closet pivot (intermediate)
— To buy a stock for a breakout it needs to have a ‘tight pattern’, preferably holding higher and of course showing relative strength (relative to $SPX).
— This applies to breakdowns to – though to play on the short side in a up trending market the stock must be in macro downtrend otherwise I will have far less conviction and it should be looked upon with a skeptical eye (scale half on the breakout here as well).
— Occasionally there are points in which there is little conviction either way in the market, we could go either way – a neutral zone (not overbought, oversold). During these rare times, breakouts should be avoided and the range trades should become the focus (12-13-13 an example of this in $SPY).