Pay attention to the shot across the bow. It will keep you off a sinking ship. (December 09, 2012)

by DAN EXPE 
I’m Dan Fitzpatrick at StockMarketMentor.com on Sunday, December 9th. I want to just do a quick video here. By the way members, there’s actually quite a bit of stuff in the weekend update, use the double time on the voice on the videos, you’ll hear me very clearly but also I’ll be talking twice as fast as I am now, so that will help you get through the stuff. Okay, for the freebies, Expedia ( $EXPE Expedia Inc ); higher highs here, look at the lows though, we’ve got a pull back to the 50-day moving average, then through the 50-day moving average and finally back to it. This right here is what I call a shot across the bow. And what I mean by that is, when a stock is in a clear uptrend, with defined support, typically along the 50-day moving average, a lot of times the first sign of trouble will be a penetration of the 50-day moving average but then it ultimately moves higher again, okay? And you say, “That was a little scary but I think we’re on track.” Then particularly when Expedia ( $EXPE Expedia Inc ) here comes back to the fifty and bounces again, now you’re quite sure, you’re quite sure that the uptrend is intact and so you buy comfortably. But a lot of times then, what ultimately happens is, Expedia ( $EXPE Expedia Inc ) starts rolling over, falls below the 50-day moving average and that’s that. So what I want to tell you is it’s a very easy lesson here, just pay attention to this kind of stuff, it matters. If Expedia ( $EXPE Expedia Inc ) keeps moving up, that’s fine, you go ahead and stay long, buy at the fifty, stay long. But if Expedia ( $EXPE Expedia Inc ) starts drifting lower again, know what that means, know what that’s about; you will wind up looking at this and saying, “That absolutely did matter.” So just watch this again, it’s called the shot across the bow, keep that in your arsenal and my bet is are you going to get on fewer sinking battleships if you pay attention to the shots across the bow.

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