I often come across great stocks that are rising – and have been rising for a while.
The real challenge is to know when to buy into one of these stocks.
Do I just wade in and buy – even at a higher price.
This could set up a quick loss on a pullback, or at least a missed opportunity to buy it cheaper.
Or do I give it some time and wait for a pullback?
This could leave me waiting as the market powers onward and upward, leaving me to miss the further upside.
The majority of the stocks that I come up with for you inside Traders Daily Direction have not yet begun to really take off – surge, in other words.
So, the core of my Stock Surge Indicator (SSI) system allows me to find stocks that have yet to get on a big upward trend – or have pulled back temporarily, setting up a surge in the making.
To get the full read on the SSI, click here to download my special report: The Magic of the Stock Surge Indicator.
And for the current stocks for this week that have made my cut for the Watch List for Traders Daily Direction, I have the full list and trading details all put together for you.
But what if a great stock of an impressive company is already on an upward trend and I still want to buy in – but only at the right price?
Fortunately, I’ve worked out a simple additional fix that you can deploy on your own.
And I’ll teach this to you right now…
As the adage goes, “the trend is your friend.”
Take a look at this chart.
Uptrends don’t get much prettier than that.
This is a dream price action for a stock trader.
Boot Barn Holdings (BOOT) has been steadily climbing for the last 12 months.
And so far for those past 12 months, it has gained 254.3%.
Shares rode the 50-day moving average (red line) the whole way up, advancing to that gain with minimal pullbacks.
But if you don’t own the stock, it can be difficult to find a good place to buy.
However, I have the solution…
This is where the regression trend comes in.
In TradingView (tradingview.com), this indicator can be found in the Trend Line Tools menu on the left side of the chart.
And this website is largely free and easy to use.
To apply it, simply click the first and last candle of the trend.
The indicator will apply a center line along with buy and sell zones set at two standard deviations from the mean.
Daily Chart of Boot Barn Holdings (BOOT) with Regression Trend Tool — Chart Source: TradingView
To ride the trend, just buy in the green zone.
This allows you to buy on the low side of the uptrend.
If you want to play the short-term swings, you can then sell in the red zone where price is becoming extended.
I like to use the last swing low as a stop loss.
The solid red line shows where my stop would be for the current move.
The red dashed lines mark the stop levels for each of the previous moves.
It’s not overly complicated.
But it works.
Hopefully, it will help you trade trending stocks.
This will enable you to buy a stock at the right price – even in a stock that’s been on the rise.