Know When To Buy And When To Sell With Charts

January 2, 2021

Entering Trades

Presence of a bullish candlestick pattern.
Price is holding support (lateral line, trend lines and/or moving averages) on the daily chart. Switch to 1 hour chart to confirm support and find ideal entry area.
If a breakout has occurred, make sure there’s volume increase. In addition, stochastics have reached oversold condition (down near 20), the blue line has crossed above the red line and they are both starting to move up.
Before entering the trade, check for earning dates. If earnings are approaching, make a note to the exact day. Don’t hold the position during earnings.
After entering the trade, make sure price continues to hold support (lateral line, trend lines and/or moving averages)
As long as price holds support and remains above the 8 EMA remain in the trade.
Check indices regularly (SPY, NDX, Dow Jones, IWM) to make sure the market is also holding support and ideally bullish or at least in consolidation mode.

Exiting Trades

Take profit when price reaches resistance. Switch to 1 hour chart to confirm resistance and find ideal exit area.
Close the position is price breaks support (now resistance), retests it and is unable to move above it. In addition stochastics have reached overbought condition (down near 80), the blue line has crossed below the red line and they are both starting to move down
Close position when price prints a bearish candlestick pattern with large down volume (red bar) and/or price closes below the 8 EMA.
Close position when earning report is scheduled to be released after the market closes or the following day before market opens.
Close position (full or partial) when indices (SPY, NDX, Dow Jones, IWM) break below support, market turn bearish and starts to move lower.