(REQ) St0ck Trend System

[Diesel 10]

Does anyone have this Stock Trend System??? It sounds very good at identifying the stocks with greatest potential to make huge moves and trades them with tight stops. Here is some of the sales copy, with the link to website at the bottom. Please share!

 

What characterizes this trading system?

 

It is a trading system for the stock market that is trying to take advantage of longer-term moves of stocks. That does not mean that only long-time investments are put on. Chances for swing trades are also more likely found and successfully executed within a longer lasting upwards move or a relative price strength in a bear market.

 

At its best a stock gets held for many months, but only few trades will make it that long and so typical holding periods are starting from one day, commonly lasting a few days up to a few weeks. Trades are not conducted to be swing trades or longer investments, instead a position is held as long as it makes sense - the market decides, according to the rules of this system, of course.

 

Daily bar charts are the main instrument to feel the stock's pulse technically.

On the fundamental side only the most accessible information is necessary.

The whole system works with tight stops. For that matter, sales can occur at the day of buying.

 

Often trades can be executed automatically with a suitable limit or stop order. Depending on the situation this may hold true for entry and exit orders.

 

This system can be applied also to ETFs and more generally to everything that is traded on stock exchanges.

 

Possibly interested in this system could be trend followers and swing traders, but also investors who want to pursue a more active approach in the market. It may be also valuable for day traders, even if they are not willing to use the longer-term components of the system. But who knows, perhaps one or the other of them will finally find out where the real money is.

Why is this trading system interesting?

 

The whole stock universe is screened by selection criteria for companies with the right product coupled with long-term price strength of their stocks. The fundamental growth situation of a company that is caused by its special product is something which likely has an ongoing momentum. Together with a confirming price strength this is the best possible indicator for an enduring trend. Consequently this process will find the gems that have the greatest future potential.

 

There is a set of simple rules accompanied by three groups of buy setups and another set of sell signals. This rigid structure enables a daily bar oriented trading style. There are situations where intraday charts may be used, but the emphasis lies on trading the daily bar chart and you can ignore completely any information with a shorter-term horizon. This rule-based trend trading system tries to achieve efficiency with simplicity.

 

Both points above suggest that this is the modern version of Nicolas Darvas' famous "techno-fundamental" trading system. However, its entry system is much more elaborated to be better adapted to modern market behavior. The selection of trading candidates is also more sophisticated. Darvas entered a stock only at its absolute high, something that proves to be a real constraint. If, for instance, the whole market is weak, this method allows to trade on relative strength alone far from the actual high. There are other differences like money management. Darvas essentially had none, as he grossly over-traded back then. But luck was with him, as he started directly at the beginning of a bull market. This trading system could be viewed as the successor of the Darvas method. Major parts of it, like the entry rules, got replaced completely and all in all it is much more refined as a system.

 

A necessary part of any trading system is sound money management. This system maximizes the long-term performance and keeps the principal risks in check. Simply diversifying into many stocks is not the answer, because that would dilute not only the single failure but also the single gain away. Instead, using the right borderlines, knowing what you can do and what not, is the key. While money management principles have to work on their own as a final safety net, this system supports them with strong help from the trading side. Some of the trading rules represent a stiff stop-loss system.

 

This is a semi-automated system that tries to beat completely mechanical ones. There is a frame of precise rules that incorporate the "tricks" of trading at the high, but there is also the trader. For that reason one whole chapter is devoted to psychology, including a comprehensive list of what can possibly go wrong with solutions or at least ideas to get on the right track.

 

Ideally this trading system enables its followers to earn with a modest amount of work a maximum of return. Does it make sense to hope for big gains with trading slow moving stocks, dull stocks of dull companies or even slower moving currencies? Or to do the opposite and chase tiny intraday movements with an exhausting maximum of concentration? Is it wise to invest in stocks that fell back and hope that there was no sufficient reason for their fall? I don't say that there are no other ways to trade, but in my opinion the best possible thing to do, is to ride the best trends there are. As Darvas put it 50 years ago: "There was nothing else for me to do while Texas Instruments, Zenith Radio and Fairchild Camera went to work for me.".

 

 

http://www.stocktrendsystem.com/