Yes. Thats another angle and for that I use relative strength.
My portfolio will show that. In stage analysis some basic rules are:
- Market has to be in uptrend…so market needs to be bullish.
- The sector needs to be in momentum…So my mistake was …I entered in Divis Labs, LTI etc when these sectors were at their fag end or going down,They were not the growing sectors or leading sectors of the bull phase. So now I have corrected my mistake. Some of my stocks now are from power sectors, Wind energy sectors, defence, PSU also. Some companies earlier I never heard of before.
- Stock has to be above 30 week EMA and that also should be increasing one.
- Dont enter very late
5)Volume has to be good …More investors should be interested in your stocks
6)Relative strength should be good compared to major index or that sector index
7) And Dont buy such stocks where nearby overhead resistances are strong…That will not allow your stock to go up.
8) Continue your journey and ride the stock, till it doesnt enter into stage 3 or stage 4…and this period can be 3 months to 3 years to 10 years also…So it can be short ride or a very long ride
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