[isatrader]

Here's the first example charts of where to put to put the stop loss. In March 2012 Abbott Laboratories (ABT) was recommended as a continuation buy on a pullback towards the 56-57 zone. The Trader Stop Loss was given as 54.49 and the Investor Stop Loss was given as 52.99.

Trader stop - looking at the daily chart the pivot low was 54.74 and so the 54.49 gives a little bit of room, plus it's below a half number as suggested in the book on page 183. The pivot low used is not visible on the weekly chart, which shows that it probably doesn't have to be the last major pivot, just the last notable pivot low, but this will become clearer as I go through these examples.

Investor stop - 52.99 was the recommended level, which is below the 30 week MA and also just under a round number. On the daily chart it is just under the 200 day MA also, but again it is not clear if this has any relevance yet until I go through more examples.

ATR distance to stops - On each chart I'm looking at the ATR(200) percentage distance from the recommended entry points to see what the average is for trader and investor positions as this could further help when choosing potential stocks with the risk reward calculations. For ABT the ATR(200) was 0.809 at the time of the recommendation and so:

• 1.87% to 3.10% ATR - Trader stop range
  
• 3.72% to 4.96% ATR - Investor stop range
  

Other observations - Price dips below the 50 day MA on a number of occasions; volume only average; relative performance fairly flat; moving averages all rising.