Frequently Asked Questions

Pocket Pivot Review / Buyable Gap Ups
The recent pocket pivot occurred out of no base, thus I didn't buy. Where exactly was the buy point?

The recent pocket pivot was a continuation pocket pivot thus occurs after the stock has broken out of its most recent base and is trending higher. It allows one to buy into a position even if they miss earlier pocket pivot buy points. This continuation buy point can work just as well as initial buy points, assuming the stock or ETF is a leader in its space.

For example, on April 28, SLV had a pocket pivot. It could have been bought at any time after it was clear the required volume would be met. Note, since SLV advanced 6.75% that day, if you bought at the top, your potential downside risk could be greater than your risk tolerance levels, in which case you should not be buying at those levels. Also note that silver is highly volatile so may not be suitable for more conservative investors.

Published: Apr 29 2011