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Stock Selling Strategies and Signals

Sell a stock if it falls 8% below the purchase price or consider selling if it climbs 20-25% above purchase price, except hold for at least 8 weeks if it goes up 20% within 3 weeks of a breakout. Watch for warning signs like new highs on low volume, falls below moving averages on heavy volume, heavy volume sell-offs or churning with heavy volume but little price movement. A climax run after 18+ weeks with a 25-50% jump in under 3 weeks and largest one day gain indicates a stock is near its peak.

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Ekta Parab
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323 views1 page

Stock Selling Strategies and Signals

Sell a stock if it falls 8% below the purchase price or consider selling if it climbs 20-25% above purchase price, except hold for at least 8 weeks if it goes up 20% within 3 weeks of a breakout. Watch for warning signs like new highs on low volume, falls below moving averages on heavy volume, heavy volume sell-offs or churning with heavy volume but little price movement. A climax run after 18+ weeks with a 25-50% jump in under 3 weeks and largest one day gain indicates a stock is near its peak.

Uploaded by

Ekta Parab
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd

Your Stock Selling Checklist

Stock Action

Sell a stock if it falls 8% or more below the price you bought in at


Consider selling a stock if it climbs 20% to 25% above your purchase price
*Exception: Hold a stock for at least 8 weeks if it goes up 20% or more within three weeks after its breakout
Stocks will often flash warning signs on their charts before they fall. Here are some to watch for:
*New price highs on low volume
*Falls below 50-day moving average line on the heaviest daily volume in months
*Heavy-volume sell-off, particularly if the stock experiences the largest price drop of its run
*Churning: heavy volume and little price progress
A climax run also signals a stock is near its peak. Here are some signs a stock is undergoing a climax run:
*Occurs after a long price run up of 18 weeks or more
*25% to 50% price jump in three weeks or less
*Largest one-day price gain of its entire run. Daily volume may also be the heaviest of its advance
*May experience an exhaustion gap, as its price opens significantly higher than the prior day's close
*Weekly price spread is the largest since the stock began its run
2011 Investor's Business Daily, Inc. All Rights Reserved

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