Relative Momentum: A Powerful New Indicator

FACT: The Strongest Stocks Lead the Market. 

In any market, you have some stocks that are leading the way, and others that are falling behind. The major indexes (DJIA, S&P 500, etc.) represent the average of this movement.

History and experience tell us that buying the leaders and/or selling the laggards is going to be more profitable than trading without considering this dynamic.

If we know WHICH stocks are leading and how much they are leading, making a profit is as easy as placing Swing Trades in the direction of the trend.

The question we must answer is, “Which stocks or ETFs are actually leading or lagging?”

Relative Momentum (RM) is the “Secret Sauce” that provides the answer. This unique new indicator looks at overall movement in any stock or ETF and compares it to the market over a period of bars in the past.

Stocks that are stronger than the general market have an RM above zero. Stocks that are weaker than the general market show RM below zero. The stock and index charts on this page illustrate the concept.

NEW Strategies Use Relative Momentum To Make More Money!

The primary ingredient of the Secret Sauce is Relative Momentum. This exciting new indicator has opened up a world of possibilities in Strategy Development.

Relative Momentum does a great job of identifying those Symbols that are being accumulated or sold. By using this powerful indicator to confirm Signals from our best Strategy concepts, higher profits are easily realized!

In the Secret Sauce, we include 2 great Strategies designed to trade End-of-Day charts – SS Breakouts and SS Pullbacks.

SS Breakouts

The Secret Sauce Breakout Strategy finds the charts that are breaking out and out-pacing the market.

These are going to be the strongest stocks in the market that are showing new signs of strength – indicating they are being solidly accumulated.

SS Pull Backs

The most powerful Signal you can trade is a Pull-Back in a primary trend. Relative Momentum makes it easier than ever before to find these profitable trades!

The chart to the left of ABC (AmerisourceBergen) illustrates the concept. The new SS PullBacks Strategy uses Relative Momentum to determine that ABC was strong relative to the general market, and fired a new Long Signal at each of the primary pullbacks.

This new Strategy beautifully complements SS Breakouts. It doesn’t fire too many Signals, but the ones it DOES fire are typically superb chart points to enter new Long trades. It’s definitely one of the best pullback Strategies we have ever seen.