My first advice about charting stocks is that you should not look at things in a vacuum. Most of the chart work I rely on is based on the continuation of an existing trend. This concept is fundamental to my approach. If you want to maximize compounding, you want to be where the action is and take advantage of momentum. You should limit your selections to those stocks displaying evidence of being supported by institutional buying. You’re not trying to be the first one on board; rather, you’re looking for where momentum is picking up and the risk of failure is relatively low.
