Monitoring

Long-term investments should be monitored on a regular basis. This is the checklist I should follow each week when I review my accounts.

For each security I am invested in, I must:

1. Review the weekly long-term chart.
2. Plot support lines and make sure they haven't been broken to the downside.
3. Look out for bearish divergences in MACD.
4. Make sure ADX is above 20 and trending up.
5. Review the daily mid-term chart.
6. Plot support lines and make sure they haven't been broken to the downside.
7. Look out for bearish reversal formations: head and shoulder, double-top, triple-top, spike.
8. Look out for bearish divergences in MACD.

Save the charts. Write down remarks. If there is a convincing case, sell the security.

I should also monitor other markets in search of buying opportunities. Ideally, a market should show, on the weekly chart:

1. A break above the resistance trendline.
2. A bullish divergence in MACD.
3. ADX breaking above 20 and pointing up.

And on the daily chart:

1. A break above the resistance trendline.
2. A bullish divergence in MACD.
3. A bearish reversal formation: inverse head and shoulder, double bottom.