Weinstein Index

Standard and poors weekly charts
1 list group chart patterns sector chapter p80
2 no buy signal did not brea above 30MA below is only 2 week rally p74
3 basic or!ation below 30MA" no buy signal# $74
4 bullish holidays p72
% basic unda!entals 4 ter! presidentials p70
& end o year rally p70
7 buy stop li!it order 4 betta ills p&&
8 buy stop buy only i breakout certain level# $&%
' buy break resistance p&4
10(
11 !oving stage 1 into stage 2 or!ations base p%'
12 position si)ing
13 reading the tape p&
14 buy bad news *sell good news p10
1% so!e trading rules news p10
1& stock +y) graph p11
17 i!portance testing resistance,support# -reaking out o trading range above resistance and above
30MA# $12,13
18 two actors breakout 1 and 2 ti!e volu!e p14
1' pullback ater breakout advance on lower volu!e is buy opp# $14,1%
20 degree o slope trendline 2 rules p1%
21 bearish bullish slopes p1&(17
22Accurate deine when chart is uptrend,dwn trend# p17
23 relative strength how a given stock or groups act in relation to overal !arket p18
or!ula is price o stock over or divided by price o !arket average
24 never buy below 30MA never sell above 30MA p2&
long range background chart . new highs or new lows/ p2&
don0t buy when relative strength line is in downturn p27
filter weinstein1not enough price shoots past MA and resistsnce ro! base* !ust look or
1 long ter! perspective was there resistance here within % years# Is it a 10 year new high2 3t will
!eet with no resistance as it shoots up# .resistance is also heavy supply is previous years p100
2 don0t worry about basing volu!e* but a breakout shouldb e acco!panied with large volu!e#
.relative volu!e/
3 volu!e at least twice average volu!e previous !onth or volu!e build up.need to tabulate/ that is
at least twice the average volu!e o the past several weeks coupled with at least so!e increase on
the break out week# 4bserve increasing volu!e over preceding weeks p104

2% 4 stages o a !a5or cycle

• relative strength co!parative properties !easuring relationship divergence eg# Sector inde+
versus !arket inde+#
• Scan industry sectors over general !arket inde+# 6reates a list o best peror!ing sector
• the older the resistance the less potent it is p'8
• i stock hasn0t traded in the last 10 years is A7 stock# $''
• double up on )anger threads to relect reward ratio opportunity#eg# 108 at least 1009
•
• :uick list actors or breakout
• level o relaive strength sector analysis
• ;ote# Stock correlations and pairs# <ivergent patterns# 7 hedging#
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• angle .slope/o base base or!ation and its duration*
• breaking MA 30 and is it a new high .as well as time use this
• is their resistance or overhead supply .long ter! analysis/ criteria for journal]
• is trading range within or!ation base narrowing= >rendlines channel
• ?olu!e conir!ation#30 ?olu!e can take out resistance. dra!atically increased@p14%
• a big advance beore breakout !eans a bigger breakout potential# $roit prebreakout
advance=
• >he older the resistance the less potent and less worriso!e when breakout e!erges Ahigh
volu!e would overco!e it..nico inerred p1%4
•
• 2% dra!atic drying up on the pull back ater breakout is a conir!ation p10%
• trend needs to be bullish
• 2& groups should be positive chart !ust be breaking stage 2 with !ini!u! o resistance
overhead## inally volu!e !ust conir! the breakout
• when in trading range a breakdown occurs and relative strength .relation o stock to general
!arket/ is good* then do not sell short# $ 10'
• 27 stock e+a!ple o relative strength although 0 when breakout occurred* was trending
higher '0 days beore breakout# $111
•
• :uick reerence guide to buying .all !entioned/ p11%
• 28 i!!ediately du!p a breakdown p11%
• head and shoulder conditions#.stage 4 / 1 new low# Bood shape 30MA breaks above it !ust
have high relative volu!e in accord with weinstein rule buy stop order was e+ecuted.li!it/#
• Cead and shoulders patterns can or! with dierent stocks in sa!e groupsector#
.opportunity/ p122
• double botto!s.not as good as CDS patt#/
• 2' circu!stances o stage 1 or!ing double botto! p124
• double botto! needs positive relative strength and volu!e to breakout p12%
• recall )anger saying big trading sessions twice a year concurs to a conluence o positive
!arket conditions and doubling up on high probability stake
• weinsteins don't rules p12'
• :ui) .and throughout book p12'
• don0t buy all in one group* buy other groups with great technicals and buy stage 2
breakouts#
• $sychology inter!ittent reinorce!ent in poker !achines
• buying 10 stocks a year strategy or your 20009 good strat# $140
• the triple thread pattern# -uy when ES line in negati ve or hugging )ero line neutral ashion*
when stage 2 break out* the ES line should !ove into positive territory# $1%0 1%1
• Fou can chalk up a ine gain even i breakout is not acco!panied by positive ES line p1%1
• triple conir!ation pattern chart p1%1
• 30 Earnings no actor in criteria weighting p1%% 1%&
• 32 at least 1 :uarter earning !arket did not care p178
• invest heavily in low priced stock advancing sharply high pro p1%7
• p,e low and high !eans nothing to stock luctuations p1&'
• 31 bail stock showing weakness in a bull general !arket p17%
• progra!!ed trading !ore volatility use sell stop losses# $p17'
• your sell stop beco!es a !arket order to sell .li!it order/
• set GTCsell stop below support accounting or a !argin correction eg# Stop at 18 1,8
while support is at 18 G and !ake stop loss a non round nu!ber to ull !arket !akers herd
!entality worst case loss % 8 p183
p183
• ater the irst substantial correction o at least 8 to 10 percent * you are going to raise the
stops(trailing stops/# $184
• i correction violates 30MA raise sell stop# 3 correction above 30MA place sell stop below
MA#continue to !oving the sell stop up as the MA advances#
• .Syste! o trailing a sell stop/Hhen MA strasightens out at top* no longer we place sell stop
below !oving .e+a!ple can be over 2 year period with ew ad5ust!ents#
MA* now we place it at new support at trought o the wave.correction )one/ p18%
• 3% initially place sell stop under previous correction low beore breakout p18&
• successul breakouts should never pullback !ore than 4 to & pecent below the breakout
point# $1'%
• at breakout issue sell at non round nu!ber but the ne+t trail stop and price rise place it at
round nu!ber#
• 3& >raders should not pay attention to corrections o less than 7 percent#
• 37 raise your stop once stock is held at c and rallies back close to prior top* raise the sell
stop# $1'%
• never stay with stock under 30MA
• setting trailing stop a!ong trendline high lows in channel# $1''
• 38eit strategy i violate trendline e+it hal and i goes to prior correction low get re!ainder
o
• swing rule peak price !inus low price add dierence to top price .i it is going above this
high .this !arks the top and is ready or the downside/ p202
• sell high as close to the pro5ected level as possible and sll the re!ainder as the stop is set
o203
• large short interest 10 ti!es average daily volu!e o stage 2 stock rises not alls sucker
shorts p222 and ater split e+a!ple p22%
• shorting
• Idon0t short when stock MA30* trades thinly* is in stage 2 and 10ti!es volu!e.splitsp227
• don0t short in strong group*always buy stop order#
• !horting rules 1(1& note228(240
• 1 adv#2 lt MA#3sidwys4wks#supportlvlstg 4downturn ;o#4breakdwn#4-buy pullbk#
• J shorting stock with overal "ullish mar#et trend e+ception* not rule* but generally 3<
!arket averages are negative* below 30MA and in stage 4 u can short# $231
• 8 D'group broke K30MA 7rel# stgthlne* trending lower*
7!nycharts technically weak in sector#
• 3s their support below breakdown i yes then will not go down6hart 7#18 p23%
• relative strength or shorting can be above )ero line* !ust !ust had topped out trending
lower# 4therwise needs to be bearish
• drop price chart correlating with relative strength negative territory is a bear opp#
• volu!e1better it increases on breakdown and then contracts on pullback
• resistance to decline.support# 3 there is steep advance with only s!all congestion along the
way is good#
• Cead and shoulders short vol#Lavge* prd# -ig up!ove beore* p241
• i heaviest volu!e is on right shoulder then dont trust or!ation# $243
• duration and si)e o or!ation CDS shows e+tent o breakout# -otto! p243
• swing rule calculation 7(31 better e+a!ple p24&
• stop loss $ % &
• protective li!it stops placed at above prior rally peaks p2%0,2%1
• keep stops below declining 30MA so that stops not taken out#
• Mventually when short consolidates into range* with new support levels* hen new rule
re:uires placing stop above resistance and below MA#
• Nsing stops along trendline path p2%'
• watch advance decline o new york e+change p27%
• spot negative divergence with <O3 and advance decline line p27&
• i both break(("bear !arket
• <O3 reuses drop urther Pulti!ate low and Advance decline continues to go down is a
bullish signal .positive divergence/ reliable gauges@
p277A
• longer divergence lasts* the !ore signiicant !ove will be
• plot dow 5ones industrial average with adv#decli new york e+change
• charting divergence p277
• !o!entu! inde+ calculate p28%
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Tim !y#es
• short s:uee)e buyers bailing shorts or up !arket#
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• -eware broker ront run on !argin calls
• stocks breaking new highs buy breaking new lows within dierent ti!e ra!es* you sell((
concurs with donchian and weinstein#
• Morning s:uee)e* aternoon s:uee)e(As short sellers be scared o what news will bring
stock higher* earnings or industry event# Qind a!ount shorting with short interest@#
• Al!ost 2inishing 2
nd
dvd o shortstocking# Row :uality i!!ature guy rant* sounds like
so!eone who lost his !o!entu! and started ranting about wall street in5ustice 5ust to ill in
ti!e#
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• 'omentum rules p28%,28&
• stock analysis i g! does not !ake a new high in 4 !onths then reversal i!!inent# >rue or
last %0 years# ( mnth rule $2'7
• gauges based on new highs or new lows or advances or declines#
• Heinstein contrarian insight p304
• headlines driving consensus o opinion#
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• )anger
• waits or earning#
• -uying break on trend line on volu!e on co!plete lat hori)ontal base
• studying prior e+a!ples o dan0s ree past newsletters* perhaps study criteria#
• Nse si!ple 20 day average* looking or above average volu!e#
• 4ptions is a !athe!atical ga!e o probability# p323
• Qutures a record at a higher rate playing a!ost daily intraday p331
• stage 1(3 charts p337
•