Today's Stock Picks

For February 13, 2003

Market Open Stock Picks:

** Price reached the Trigger Price and reached the Target Price but did not reach the Suggested Entry Price.

General Information:

• We usually post daily picks before 6:00am E.T. You should refresh this web page around 9:15am E.T. in case that we modify some picks due to sentiment change by pre-market news. For example, the Dow Jones Future gaps up or down over $150 in the pre-market.

• We suggest to trade the stock at or near the Suggested Entry Price (Smart Entry Price) only after the stock has touched the Trigger Price. Beware that some stocks may not pull back to the Suggested Entry Price or it can take between 1 second to over half hour before some stocks pull back to the suggested entry price after pass the Trigger Price. It is up to you to choose what price to entry at your own risks. Our stock picks are for your reference only.

• We suggest to exit a position immediately when the stop loss price is reached; to close any position half hour before market close to prevent risks of more losses.

• We CANNOT update the "Status" in real time from "Waiting" to "Missed with Gap Open", "Avoided", "Removed", "Profit Exit", "Stopped" "Market Close Exit", "Trend Line Broken Exit", "M-Top Broken Exit", or "W-Bottom Broken Exit" when the stock pick prices are triggered. Therefore, we will only update the stock pick "Status" and "Results" AFTER the market close.

• We suggest to draw trend lines after the stock pick is in the money. Move the trend lines as reference to change the stop loss price to a profit stop price and consider to exit if a major trend line, M-Top or W-Bottom pattern is broken.

Stock Pick Explanation:

Time / Price Limit: The purpose of using "1 hour or All day" for Time is to define which stock picks are or are not having enough momentum movement under certain timing conditions. If a stock reaches the Trigger Price within the time frame we expect, then this stock pick may have less likelihood to be stopped by stop loss and have more probability to reach the estimated target price. 

The purpose of using "No Limit or Specific Stock Price" for Price Limit is to provide accurate stock price resistance for the stock picks. If a stock moves beyond the Specific Stock Price we indicated before reaches the Trigger Price, this stock pick may have more chance to be stopped by the Stop Loss Price later.

The stocks move beyond the Time frame or the specific stock Price Limit should be avoided to trade.

1. "1 hour" means that you may consider to enter a trade only if the stock price reaches the Trigger Price within one hour after the market opens. Otherwise, the stock pick should be avoided because momentum may become weaker later.

2. "All day" means that you may consider to enter a trade if the stock price reaches the Trigger Price at any time during market hours except the last 30 minutes before the market closes. For example, a major horizontal support / resistance price can be broken at any time in the market hours and still have strong momentum to push the stock price in a great distance.

3. "Specific Stock Price Limit" means that you should consider not enter a trade if the stock price move beyond the specific stock price we indicated in the opposite direction before the stock comes back to reach the Trigger Entry Price.

4. "No Limit" means that you may consider to enter a trade no matter how far the stock price moves in the opposite direction before the stock comes back to reach the Trigger Price. The "1 hour" rule will be still applicable if the "1 hour" is indicated.

5. Gap Up and Gap Down and within 70% profit distance

Gap openings happen often. It is better to wait for the stock price to come back to the Suggested Entry Price if the stock gap crosses the Trigger Price.

For example, if MSFT opens at $50.40 and our Trigger Price is $50.01, Suggested Entry Price is $49.96 and target price is $51.00, it is better to wait for MSFT to move down to the Suggested Entry Price to enter the trade. But if MSFT moves up to $50.75 before it moves down to the Suggested Entry Price, this stock pick should be avoided because MSFT has completed over 70% distance to the target price between $50.01 and $51.00. The momentum toward the target price for a second time from $50.01 to $51.00 may be weaker.

6. M-Top and W-Bottom Exit Suggestion:

It may be better to exit a long position if a M-Top pattern has formed and the double distance between the height and the center line of the M-Top pattern is below the Trigger Entry Price or Stop Loss Price. We suggest to exit when the center line of the M-Top is broken.

It may be better to exit a short position if a W-bottom pattern has formed and the double distance between the bottom and the center line of the W-Bottom pattern is above the Trigger Entry Price or Stop Loss Price. We suggest to exit when the center line of the M-Top is broken.

7. New Type of Status (Avoided): We should avoid to enter a stock pick in some cases when the stock moves unfavorable to our expectation and strategies before the stock reaches the Suggested Entry Price. Here are some situations that we should pay attention to.

M-Top and W- Bottom Pattern formed before reaching the Suggest Entry Price.
A stock may gap open or move over the Trigger Price for a Long stock pick, but forms a clear M-Top pattern in candles stick chart before the stock reaches 70% distance of the Estimated Target Price and then starts to moves back to the Suggested Entry Price. Be careful if the center line of the M-Top Pattern is still above the Suggested Entry Price, but the 1 to 1 target distance of the M-Top pattern is below the Stop Loss Price. Then this Long stock pick should be avoided to enter because the stock price has to break the center line of the M-Top pattern to reach the Suggested Entry Price and will mostly likely to move down further to pass the Stop Loss Price before a reversal.

The same strategy should apply to a Short stock pick. A Short stock pick should be avoided when a W-Bottom pattern formed with the center line below the Suggested Entry Price but the 1 to 1 W-Bottom target distance is above the Stop Loss Price.

8. Starting from May 2003, we do not suggest to chase any Gap Open stock any more because we believe that to wait for the stock price back to our new Suggested Entry Price is a safer way to trade. It is better to miss a trade than to lose more money if the stock pick is stopped with a higher stop loss percentage.

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