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Stock monitoring

7 things I am monitoring actively

  1. I do my analysis of stocks and the general stock market everyday. I go trough my watchlists and ask myself: Are the stocks I am monitoring strong? Do they lead the market? If yes, it’s a good sign that my stock selection process is working.
  2. How many stocks do I have on my watchlist?
  3. How do the leading large cap stocks look like? Are they close to all-time highs or are they broken down without any recovery? If all charts look like a catastrophe it shows me that nobody is buying glamour, large cap stocks (like $AMZN, $AAPL, $NFLX etc.).
  4. Do the indices show a bottoming pattern? If yes, it’s a good sign. Especially if the updays show higher volume.
  5. Are the indices in a long-term uptrend? You can have a look at the weekly and monthly chart. If you have a solid uptrend, the odds are higher for a continuation instead of a reversal. Maybe a correction is just a small pause in a long-term bull market.
  6. I monitor the % of stocks above the 50 MA and 200 MA. They gave me clues about the broad trend of the markets. In a strong bull market, everything is above the 50 MA and 200 MA.
  7. Are the indices in synch with each other? You always want to see a broad market trend. That means small and mid caps should lead. Use the Russell 2000 for an analysis. This index should be in synch with the large cap indices like Nasdaq and S&P 500.

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