Markets tend to move cyclically. It moves higher for a while then moves lower but in a bull market it won’t go as low as it went high. We call this “higher lows”; this very important distinction while obvious is significant as it creates the environment in which we want to go long.

Some traders make the mistake of getting long after a recent run ups out of fear of missing out. Unfortunately, they get to participate in a normal pull back and in many cases exit with a loss only to see the market find support and go up again making their losing trade a winner should they have stuck with it. We are not advocating ignoring strict stop loss rules but to get in cycle. After a run up is not the time to enter any market. Markets should only be entered after a setup has developed. The chart below represents a setup. This example shows a confirming chart pattern with rising volume in a overall market making new highs.  WMS should be added to your watchlist for possible entry at the right time. Watchlist should be populated with many such trading instruments so there is no shortage of ways to enter the market with the best chance to profit.