Today, we’re diving even deeper into my personal trading plan…
It’s built for momentum trading – an approach that’s been extremely powerful over the last several years. And the key is taking a top-down approach.
A top-down approach to trading means that we look at the market layer by layer.
The first layer is the major market indices. For me, these include the Dow Jones Industrial Average, the S&P 500, the Nasdaq, and the Russell 2000.
Then, if there are signs of positive momentum in the broader market, we can drop down and assess each individual sector.
For example, let’s say the Nasdaq is showing signs of strong momentum. We would then take a look at the tech sector to see if it’s in alignment with the broad index. If both the Nasdaq and the tech sector agree with each other, it’s simply a matter of finding an individual stock that also shows signs of strong momentum.
In other words, we work our way down – large to small. We start with the market and eventually find ourselves evaluating individual stocks.
Check out the video below to learn more about how this process works.
And next week, we’re going to jump into the price charts so you can see how my trading plan works in action.
The post The Key to Uncovering the Best Stocks in the Market appeared first on Centurion Publishing.
