I’ve been looking to get back into the stock market for a while now for my 401K and IRA accounts – (of course right after we are hitting new highs ). I have been looking for something simple. I think simple is better and easier to stick with. I wanted it to be easy to scan for setups using TOS and with little analysis. I also wanted it to be based on technical patterns. So what did I decide on?
I have decided on trading pull backs.
What I will be looking for:
1. Stocks in a trend up or down
2. Stocks in a trend up or down in alignment with the overall market
3. Once we have that I will be looking for stocks that have pulled back into the area between the 8 EMA and the 21 EMA
4. Then I will be looking for a candle pattern and entry back into the over all trend of the market.
Scans I will run to look for candidates
1. 8 EMA 21 EMA cross
2. Stocks with price below 8 EMA and Above 21 EMA
Then I will go through those stocks looking for good entries with defined risk reward of at minimum 1:1