The only pattern you’ll ever need to know in uptrending markets is commonly referred to as a Pullback Off Highs (POH). And sure enough with the recent vertical leap to nosebleed levels we’ve seen in the indexes a bunch of names took off out like rockets.
All of those same names got away from those low risk entry points very fast leaving any trades taken now being of higher risk entries due to being away from those prime entry points that we use to manage risk from a technical perspective.
Below are examples of names that showed me the “What Do I Need To See To Make Me Take A Trade” centering statement. It’s what we want to be on the look out for from here with any issue we are interested in on the longside.
RINO — RINO International
It ran from the trigger price of 24ish to 26 in short order. One and done hit and run and you got paid IF that is your plan.
RGLD — Royal Gold
Triggered Tuesday in a gap up. This stock opened at 46.31 so you had a blink your eye you missed it moment to buy the stock and here it is pushing 48.00. One and done hit and run and you’d be done.
RAX — Rackspace Holdings
Triggered and is crossing over the pink line. Now we get to deal with that 50 day average where it is thus far facing resistance. Still though all you had to do was wait for the crossover and you got a quick 64 cents out of it so far. Almost a one and done hit and run.
FIRE — Sourcefire
Now approaching resistance. Nice quick one and done trade. All you had to do was wait for the break of the pink line.
Well there you have it. 200 shares of everyone that triggered and you’ve got a great week. This is what Pullback Off Highs patterns are all about.
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