Buying and Selling Waves – 5M

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IMPORTANT POINTS

1. Every upward or downward swing of the market consists of numerous buying or selling waves.

2. The degree of success or failure of buying or selling waves indicates whether the market is growing stronger or weaker.

3. In buying stock, look for the down waves in the market and in your stock.

4. The waves provide clear indications of the relative changes of supply and demand.

5. To be able to determine the turning points is the mark of the ability of a good trader or investor.

6. It is important to master the ability to:

     a. determine the final tops of bull markets and intermediate or minor up moves.
     b. determine the final bottoms of bear markets and the inter­mediate and minor down moves.

7. Cover your shorts and go long at the bottom of a panic.

8. Sell out all long positions and go short at the top of a boom.

9. Control your emotions.