Why I Never Chase Extended Moves
A stock breaks out. It surges 15%, 20%, 30% above its moving averages. The chart looks perfect — if you squint. Social media lights up with screenshots and hindsight entries. The temptation is real.
I skip every one of those.
My system filters out extended entries before I ever see them. A stock that has drifted far above its trend structure gets flagged and removed from the signal list. The scanner does this without emotion. No overrides. No “this one looks different.”
The reasoning is structural. When a stock is extended, the easy money from the initial breakout is gone. Late buyers pile in at prices with no margin of safety. A normal pullback from that level — the kind that happens all the time in healthy trends — hits the stop before the thesis plays out. You get stopped out on noise, then watch the stock continue higher without you.
The entry edge comes from buying near controlled, lower-risk points: pullbacks to moving averages, breakouts from tight flags, volume confirmations near support. Every system I run requires price to be near its trend structure, not far above it.
Skipping extended moves feels wrong in the moment. The stock keeps going. You feel slow. But the alternative is worse — entering too late, getting shaken out on the first dip, and paying tuition for a lesson the scanner already taught me for free.
Trade Like a Pirate ☠️
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