In April 19 we have introduced Investing in stocks with Sweet Spot and got feedbacks from traders wishing to know more about it. In this Sweet Spot Stock (SSS series) we’ll elaborate with more examples with three possible situations after the Sweet Spot entry: (a). followed with uptrend; (b). followed with sideways market; and (c) followed with a trend reversal.
Here is the first example of how a SSS entry look like:
Here is the first example of how a SSS entry look like:
Above AbleTrend chart showed you:
- Identifying the uptrend with a large blue dot;
- Specifying the key market support levels with small blue dots.
Recommended Sweet Spots for Buy Positions (SSb)
1) After a buy signal (large blue dot)
2) After market has tested AbleTrend T2 support levels (small blue dots below the bars)
3) Bar closes higher than open or with a blue bar
Benefits of buying stocks at the Sweet Spot are twofold:
First of all you buy stocks only when uptrend is detected with AbleTrend large blue dot; second since you know where the market support levels are with AbleTrend T2 support levels (small blue dots below the bars), you can choose to buy the stock when price retrace to its support levels, so that your initial stop can be smaller, thus reduce the risk of investing. In addition, you can add more shares at the SSb on the way up.
Here is the outcome of the above SSS entry.