Page 1016 - How to Make Money in Stocks Trilogy

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• BASIC GAME PLAN FOR MAKING MONEY IN STOCKS •

Step 1: Only buy when the overall market is in an uptrend.
Step 2: Buy stocks with CAN SLIM traits as they break out from a
telltale chart pattern.
Step 3: Take most profits at 20% to 25%. Cut all losses at no more
than 7% to 8%.

We’ll cover the details of each step as we go through the buying and sell-
ing checklists. But for now, let’s take a peek at these 3 steps in action.

Step 1: Only Buy When the Overall Market Is in an Uptrend
You can always see if the market is in an uptrend or downtrend just by
checking the Market Pulse in The Big Picture column. In the following
chart, you can see how the Market Pulse outlook helped investors buy and
sell at the right time in 2010.

Nasdaq – 2010 4/27/10 “Uptrend under pressure” Index
Weekly Chart Trend may soon change. Protect 2800
your profits.
2600
2400
2200

9/1/10 “Confirmed uptrend” 2000
5/4/10 “Market in correction” 1900
New rally underway. Time to
Trend has changed. Avoid new get back into the market. 1800
buys. Lock in gains; cut short 1700
any losses.
1600
1500
© 2013 Investor’s Business Daily, Inc.
Volume (00)
80,000,000
50,000,000
30,000,000
18,000,000
Jun 09 Sep 09 Dec 09 Mar 10 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11
The Market Pulse’s 3-stage approach helps you see
when to buy and when to take defensive action.