Page 1139 - How to Make Money in Stocks Trilogy

Selling Checklist 125

It wasn’t until I reviewed some past trades that I realized my mistake. I
was buying 4%–5% above the ideal buy point, but I was basing the 20%–25%
rule on my purchase price instead of on the stock’s ideal buy point. (That’s
just one example of why reviewing your trades is so important. See Chapter
7 for how to do a profitable post-analysis and fix any bad habits.)

Don’t Ignore a Winning Stock After You Sell It!

The Best Stocks Give You Multiple Money-Making Opportunities
The best stocks will typically form multiple base patterns as they double or
triple in price. Like a hiker, they’ll go up for awhile, rest (or maybe slide
down the hill a bit), then continue the climb.
So when you sell a stock that hits that 20%–25% benchmark, it’s not nec-
essarily the end of the story. Watch to see what happens next. Does it pull
back and form a new cup-with-handle or other base pattern? Or does it
climb higher, then move sideways to form a 3-weeks tight or flat base?
These and other scenarios can give you another opportunity to buy the stock
and profit again.
It’s absolutely critical that you continue to track these winning stocks.
®
They have the CAN SLIM traits, and they’ve proven they have the power to
break out of a good chart pattern and make a nice gain. If they do repeat that
winning process, why not grab another piece of those additional profits?
The chart for Chipotle Mexican Grill shows an example of how that
can work.