The above example is of the SPX with examples given on the chart.
1) price is above or revisits 150 (revisits/retraces from above)
2) Stochs move above 20
3) Histogram crosses above 0-line
Buy at the high of the candle when both Stochs & are above 20 and 0-line
Stops at recent swing low
Target is kept open as we trail the stops
Be alert when stochs drop below 80 and crosses below 0-line. Either price is making a correction or a change is underway.
Works best on:
Strongly trending markets
Reverse rules for short positions
Be extra cautious when is flat or when you notice choppy price action
Do pay attention to fundamentals
Entry #4 is not pointed out but can be seen by the Blue/Red/Dashed lines on the chart. Notice how entry is a bit too close to the swing high? That should be an alert that the RR for a new entry is not good enough. Also notice price revisiting entry #3 almost. At the moment, long position stop loss would be moved to 1760 or 1734 (entry #3). A break above 1851.4 will confirm that the trend will continue to make new highs. Close below 1760 (the final stops as of now) indicates a discrepancy to the system and as such start watching for possible bearish moves. Keep an eye on stochs/MACD to determine if its just a bigger correction or indeed a change of trend.