Page 142 - How to Make Money in Stocks Trilogy

America’s Greatest Stock-Picking Secrets 67

Price 120 100 80 70 60 50 40 34 30 26 22 19 16 14 12 10 8 7 6 5 4.0 Volume 300,000 140,000 60,000 20,000 © 2009 Investor’s Business Daily, Inc.

Jun 1983
e t e ase s 8-week bas as Volume up Volume up p m Mar 1983
Sell: climax top off 3rd stage base Sell: climax top off 3rd stage base r f o x m : S p much more o h p much At end of 8 weeks, now up muc p w n e w , n 1st 2 weeks e w Note: up 20% in 1st t Note: up 20% in 1 % 2 u e e ll weeks k e l w s hold 8 full hold 8 ful l ld8fu must

S&P 500 d A Note: A A B B w Buy after pull back below e c p e week moving average 10-week moving average r i m e 10 line and as price comes m c i d eek line on n n up across 10-week line on o e w p across 10 1 o volume increase a c e B B A Mar 1982 Dec 1981 Sep

Jun 1981
o ff to Mar 1981 Digital Switch increased 843% in 46 weeks.
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Note: at point B the S&P 500 (top thin t line) makes a new low relative to point A. ti l r l a k However, Digital Switch stock at point B Digital Switch stock at point B h r r does not make a new low like the S&P 500 o k does, but holds up at a much higher level. h hi d ld
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Mar 1980 Jun 1980
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Dec 1979 Sep 1979
Digital Switch–1982 Weekly Chart Jun 1979 Mar 1979
Price = 20*eps 5.00 4.50 4.00 3.50 3.00 2.50 2.25 2.00 1.80 1.60 1.50 1.40 1.30 1.20 1.10 1.00 0.90 0.80 0.75 0.70 0.65 0.60 0.55 0.50 0.45 0.40 0.35 0.30 0.25 0.23 0.19