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How to read charts with skill & identify correct buy points

How to read charts with skill & identify correct buy points. August 16, 2012. Current Market Update. Market in Confirmed uptrend FTD on 7/26 (NASDAQ closed @ 2893 Wed 8/15 NASDAQ @ 3030 Up about 4.8% since FTD Distribution days 2 for NASDAQ and S&P500 3 for NYSE Composite.

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How to read charts with skill & identify correct buy points

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  1. How to read charts with skill & identify correct buy points August 16, 2012

  2. Current Market Update • Market in Confirmed uptrend • FTD on 7/26 (NASDAQ closed @ 2893 • Wed 8/15 NASDAQ @ 3030 • Up about 4.8% since FTD • Distribution days • 2 for NASDAQ and S&P500 • 3 for NYSE Composite

  3. Why use charts? • How to Find & Own America’s Greatest Opportunities • Success rule number 1: • You spot super winners by know your classic chart patterns and every week going through hundreds of charts looking for these classic patterns and then checking for big fundamentals, big earnings, sales, ROE and a sound compelling story. • You relentlessly do this whether you’re in or out of the market, otherwise you’ll miss the big ones that come when you least expect or believe them.

  4. Why use charts, cont’d? • Charts don’t Lie • A chart records the factual price performance of a stock. • Charts allow you to ignore the pundits and CNBC that say what s stock should be doing. • Charts let you see what fund managers are buying and selling. • Big changes in volume tell you a lot about a stock. • Look for Volume spikes for clues. • Charts show you when to buy and Sell • CAN SLIM traits tell you what stocks to follow. • Charts show you when to buy and sell

  5. Why use Charts? • Bill O’Neil interview

  6. Cup with Handle • Video • http://ibdtv.investors.com/550660/201010151626/ibd-meetup-investor-education-series-lesson-3-cup-with-handle.aspx?mrt=1

  7. Double Bottom • Video • http://ibdtv.investors.com/550662/201010151330/ibd-meetup-investor-education-series-lesson-3-double-bottom.aspx?mrt=1

  8. Flat Base • Video • http://ibdtv.investors.com/550664/201010151620/ibd-meetup-investor-education-series-lesson-3-flat-base.aspx?mrt=1

  9. Summary • Use Charts to identify proper bases • Relentlessly review stock charts every week • Know what to look for • Cup with Handle • Double Bottom • Flat Base • A fortune can be made by learning to read charts

  10. Group Exercise • Check the IBD top 20 once a week and see which sub-industry has greatest improvement over last 6 months • Report back to group on top stocks in these sub-industries • This exercise will help us find leading stocks in top sub-industries • Will build discipline into our trading/investing

  11. Sub industry Movements • 7/22 post – Finance Credit card/payments sub industry • From 29 to 15, now at 58 • WXS • Top stocks – V & GCA • 7/30 post – Telcom Services – Integrated • 49 to 20, now at 15 • V, T, TWTC (defensive stocks) • 8/6 post – Medical – Generic Drugs • 64 to 13, now at 26 • IPXL, PRGO, WPI • 8/13 post – Medical – Services • 17 to 5, now at 3 • ESRX

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