Instructions for using the 2560 strategy:
The 2560 strategy employed by the renowned investment guru Andrew Bush is remarkably straightforward in its approach. The key tenets of this methodology are as follows: First, the 25-day moving average must be firmly trending upward. Then, when the 5-day moving average crosses or steps back onto the 25-day moving average, and the trading volume over the past 5 days is greater than the 60-day average, an opportunity for intervention presents itself. The optimal time to act is when there is a small star line transition occurring. Specifically, there are four distinct scenarios to watch for:
- When the K-line starts to move and the 5-day average drops below the 60-day average, it signals a tempting opportunity that should be seized decisively.
- When the K-line begins tracking the 25-day moving average and the 5-day average crosses above the 60-day average, this indicates a momentum-driven, short-term opportunity with a relatively unstable pattern.
- When the K-line is moving along the 25-day moving average and the 5-day average is rubbing against the 60-day average, it signifies a trading volume band opportunity with a well-established pattern.
when the K-line is tracking the 25-day moving average and the 5-day average has remained above the 60-day average for some time, but the most recent 1–2 days have seen the lowest pit volume levels, this represents a contraction, or a "black horse" opportunity for bullish stocks. By meticulously following these guidelines, investors can leverage the 2560 strategy to navigate the market with heightened precision and profitability.
Buying conditions for "2560 Tactics":
The 2560 strategy relies on two fundamental conditions being met. Firstly, the 25-day moving average must be trending upward in a consistent manner. Secondly, the 5-day moving average must be situated above the 60-day moving average. Only stocks that satisfy both of these criteria can be considered eligible for the 2560 strategy. From there, the strategy examines additional factors to identify optimal entry points. Specifically, the strategy looks for instances where the stock is stepping back towards the 25-day moving average, while the trading volume is continuously decreasing, ideally with the volume falling below the 60-day average.
- when a stock is stepping back towards the 25-day moving average. In this scenario, the strategy closely examines two primary factors. Firstly, the trading volume must be continuously decreasing, with the ideal scenario being that the volume falls below the 60-day moving average.
- The appearance of a small star line near the 25-day moving average is regarded as a favorable signal, as it can help to halt the stock's decline, the presence of multiple small star lines that do not breach new lows is viewed even more favorably, as it reinforces the notion of a stabilizing trend.
Due to the large number of stocks that meet the above conditions, the following conditions can be added for further screening and filtering to enhance the safety of the stocks: - The strategy looks for stocks where the 5-day moving average is generally flat or, ideally, tilting slightly upward.
- The strategy seeks the presence of a bullish golden cross pattern in the KDJ indicator, as this signals strengthening momentum and increasing buying pressure.
3 The MACD oscillator, looking for either a shortening of the green column or a lengthening of the red column.
Selling Conditions for "2560 Tactics":
If one of the following conditions is met, it is necessary to consider reducing positions. The more conditions are met, the more you need to sell: - When the stock price is far away from the 25 day moving average or there is a "runner" phenomenon.
2 When the J value is above 100 or when J is downward or KDJ is deviated from the top.
3 When the K-line is near the high point of the previous wave. - When the stock price does not reach a new high after a strong pull up.
5 When the K-line is near an important moving average.
6 When the K-line is in a chip intensive area or platform position. - When the 5-day moving average crosses with the 60 or 120 day moving average.
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