First, restrict your selection to the universe of stocks that fulfill certain criteria.
Choose stocks that…
–> Have a price of at least $7
–> Have an average daily volume of at least 500,000 shares

STEP 1: Identify a stock that is in an uptrend or a downtrend.

STEP 2: For stocks in an uptrend, identify those that are periencing a pull-back.For stocks in a downtrend, identify those that are experiencing a pull-up.

STEP 3: Once an appropriate candidate is identified, place a limit order to buy (uptrend) or sell short (downtrend) the stock based on the Master Plan.

STEP 4: Once a stock has been traded (a position opened), place a stop-loss order to limit downside risk and place a limit order to identify the price at which you will take profits. (Ideally, these two orders are placed together as an OCO (One Cancels Other) order; this is sometimes called an OCA (One Cancels All) order.