Buy younger trends | stockbee

2/25/2013

Buy younger trends

At any given time in the market there are young trends and there are old trends. Young trends are trends that have just started in last few days to weeks. Old trends are trends that are well established and in later stages of their trend.

Old trends near market correction zones like we might be going through are susceptible to reversal or sharp reversal. If you are primarily holding old trends you can have sharp drops in many of them at same time during correction.

Because markets are rotational in nature, while old trends break down or correct or go in to range, they are replaced by young trends . New trends start on new set of stocks, they gain speed and go on to gain leadership.

If we focus on finding young trends we can ride them for longer duration. We can add to positions. Younger trends also give you more time to research them. The young and old refers to how many days since a stock established a new uptrend. A stock like say TVL has old trend

The first or second swing in younger trend is better than entering old trends. Older the trends more vulnerable it can be to reversals. So look for young trends.  

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