https://reddit.com/link/1u1u2sx/video/onc7tarffe6h1/player
Finding good stocks is hard.
Knowing when to buy them is often even harder. So this the framework I generally use:
๐. ๐๐ง๐ฅ๐ฒ ๐๐ฎ๐ฒ ๐ฌ๐ญ๐จ๐๐ค๐ฌ ๐ข๐ง ๐๐ง ๐ฎ๐ฉ๐ญ๐ซ๐๐ง๐
I want the 20, 50, and 200-day moving averages stacked correctly and sloping higher. In practice, that usually means a pattern of higher highs and higher lows, with price trading above key moving averages.
๐. ๐๐จ๐จ๐ค ๐๐จ๐ซ ๐ฌ๐ฎ๐๐๐ข๐๐ข๐๐ง๐ญ ๐ฏ๐จ๐ฅ๐๐ญ๐ข๐ฅ๐ข๐ญ๐ฒ
I prefer stocks with an ADR of at least 3-4%. If a stock barely moves, you need significantly more capital to generate meaningful returns. I'd rather allocate capital to stocks that are actually moving.
๐. ๐๐จ๐จ๐ค ๐๐จ๐ซ ๐ญ๐ข๐ ๐ก๐ญ ๐ฉ๐ซ๐ข๐๐ ๐๐๐ญ๐ข๐จ๐ง
I pay close attention to price contraction. Tight consolidations often signal that weaker holders have been shaken out. Combined with a strong underlying trend, they can create attractive setups for continuation.
๐. ๐
๐จ๐๐ฎ๐ฌ ๐จ๐ง ๐ฅ๐๐๐๐ข๐ง๐ ๐ฌ๐ญ๐จ๐๐ค๐ฌ ๐ข๐ง ๐ฅ๐๐๐๐ข๐ง๐ ๐ ๐ซ๐จ๐ฎ๐ฉ๐ฌ
Markets move in cycles. At one point semiconductors may lead, then aerospace, software, or energy. I try to focus my attention on the strongest stocks within the strongest industries and sectors.
๐. ๐๐จ๐ง'๐ญ ๐ข๐ ๐ง๐จ๐ซ๐ ๐๐ฎ๐ง๐๐๐ฆ๐๐ง๐ญ๐๐ฅ๐ฌ
I like companies with strong and accelerating revenue and earnings growth. Positive cash flow is a bonus. Strong fundamentals give me more conviction and make it easier to sit through drawdowns without second guessing. You can do your due diligence your own way, I'm just sharing mine in the video.
There are countless ways to make money in the markets, and this is just one approach. It's not the only way, but it's served me well over the years. It might seem simple, but it took a lot of trial and error to cement these rules in my brain. Hope this helps!