Hi YXI friends,
How I currently decide on trades (not necessarily in this specific order)
Look at my ML signals, in terms of the signals and streaks to get comfort on an asset’s recent bullishness.
Examine the cross-asset trends, from stocks and bonds to crypto and bonds, which gives me a sense of the market dynamics.
Check my cycles indicator (now available on TrendSpider; see below), because I don’t want to swim against the tide.
Check the fundamentals, such as revenue and EBITDA growth versus multiples over time. Expensive multiples are fine if that’s the norm for the specific stock (e.g. TSLA), but I want a sense of what the market is pricing in its optimism or pessimism.
Examine the price technicals for the Elliott Wave counts and determine ideal entry, stop-loss, and take-profit points. I adhere to my stops very strictly.
When I have all these elements aligned in my favour, I will build a position on a volatility-adjusted basis. This means volatile stocks (e.g. BMNR/ TSLA) warrant a smaller position than relatively stable stocks (e.g. MSFT). Note that volatility can change over time, so regular monitoring is also needed.
Because I size my positions using a rule-based approach and follow my stops strictly, I am not very worried about being wrong on any or all of the names. That is simply the cost of the business. I keep examining, look for re-entries, and go again when it happens.
Separately, make sure you read my META section today.
YX Cycles on TrendSpider
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