Stock Trading Methodology

I use some simple rules for stock trading.

To enter a long trade, I want the following:

• A stock trading at $5 or more
• A stock trading above it's 200 day moving average
• The average daily trading volume of the stock > 500,000 shares
• The RSI(2)< 2
  

As a practice of convenience, I typically will buy a stock at the close of the trading day.

To exit a long trade, I sell the stock upon the following:

• The stock price moves higher than it's 5 day moving average

Each day, I typically place a sell limit order above the 5 day moving average price so that I don't have to sit in front of my computer all day.

I rely on a lot of the ideas presented by Larry Connors in his book Short Term Trading Strategies That Work. I encourage you to get this book and learn the techniques presented.

Check in every day between 3 - 3:30 PM EST, and I'll present some stocks that meet the criteria. We'll review our picks a week later.