Stock selection for major wave B rebound

Go for stocks that can at least double its price (use chart formation to project the target price). If possible, on the safe side, get a fundamentally good stock, company with good management, high dividend and high asset backing. Try to balance between risk and return, the usual rule higher risk higher return, lower risk lower return. Use charts to determine the entry points.

In general there are stocks that (A) move ahead of the market; (B) move inline with the market and (C) lag behind the market.


The above stock is one phase ahead of the market with stock well above its low that was set in October 2008. Since then it has completed its wave 1. It is currently in sub-wave b of wave 2. Wave c provides good entry point. Wave 3 target price is at least equal to that achieved during wave 1 advance. Normally wave 3's length = 1.618 x wave 1's length. In a strong run up wave 3's length can equal to 2.618 x wave 1's length. This is a typical stock already in motion.

The above is also ahead of the market. This stock has yet to complete its wave1 and its current price is much higher than its October 2008 low. For stock of this chart-form, there is a short term run up to complete sub-wave v. Wave 2 low can be good entry point.

The above stock is ahead of the market but its current price is moving close to its October low. It is in the process of completing its wave v of sub-wave C of Wave 2. It is forming a bullish double bottoms reversal pattern. Monitor closely for entry. Next up surge the volume should be higher than wave 1 volume. If it can break the top of wave 1 with high volume, minimum target price is another wave 1's length up from the top of wave 1.

This stock as shown above is slightly ahead of the market. Wave A was completed in early March 2009. It is currently in sub-wave ii of wave 1. Sub-wave ii is excellent entry point. Watch out for the possibility that the current rebound is sub-wave i of wave 5. Run for your life when prices drop below point A.

The above stock is inline with the market trying to finish its sub-wave v of 5 that is a good point to enter the market. Basically this is a weak chart, it will lag behind the rest. The strategy is to monitor its wave 1 to assess its potential while trying to make a double from wave 3 of other stocks. Easy to talk but require hard work and close monitoring plus luck to achieve.


The last chart illustrates a stock that is going for a-b-c-d-e correction for wave 2. sub-wave iii of wave e provide good entry point. Watch out for triple bottoms formation accompany by diminishing volume.