Wednesday, November 23, 2005

Trend Lines: Good Areas to Buy Stocks

Trend lines define and confirm trends by connecting a series of highs or lows. Trend lines offer excellent places to buy stocks within an uptrend, because they offer a natural stop loss area just below them.

Right now, the stock market is trending higher. We’ve been swing trading aggressively on the long side during the past few weeks, but the virtual straight-up move lately offers little in the way of new stock picks for buying. While the trend remains solidly up and we’re expecting additional rallies in the coming weeks, we’ll be looking for pullbacks to uptrend lines to establish new positions.

One example of an uptrend stock is AAPL. We highlighted AAPL in our stock newsletter on November 10th with a buy price of $61.25. Wednesday it reached $67.98, which is a very nice gain of 11% from our buy price in less than 2 weeks.

This stock and many others will be on our radar to highlight for additional buys in the near future as they find rising support at their uptrend lines.

Jeff White


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