Frequently Asked Questions
Q: I've been trying to implement your idea of buying stocks at pocket-pivot buy points but, I'm afraid, without much success.
Trying to figure out what seems to be wrong, especially during the last few months, during which the market has been good, it seems to me that maybe my biggest stumbling block is impatience with holding on to a pocket-pivot buy when it doesn't seem to be doing much: some of the commodity stocks and Oracle are a few examples, but there have been others also.
Do you have any suggestions as how to go about deciding whether a pocket-pivot buy has had enough time to reasonable expect that it should be showing signs of producing or should be liquidated in favor of something else?
A: If you buy a pocket pivot and it doesnt move higher within a week or two in the face of an uptrending market, you might sell it out for another stock that is pocket pivoting, or you could keep it in your portfolio if you have room to buy another stock that just pocket pivoted. Of course, each investor must decide for themselves how much of their trading capital they wish to have at risk, and this comes down to each investors' own risk tolerance levels.
If on the other hand, your stock is not moving higher because of a temporarily weak market, you might hold the position, assuming it does not hit your sell stop.