While everyone is celebrating the big push over 13,000 The Dow's
gain Friday marked the 37th record close for the index since
October. But I would rather talk about what you should have done so
you will be ready next time that happens. When everyone was running
around in March saying, " the world was coming to an end .... "
That's the time I like to buy. If you look at our last post we told
you about the worst crashes in American history. Amazing isn't
it .... we bounced back from each one. Large drops are the time to
buy. Did you ever ask yourself , when the public is selling .... who
is buying ? YOU ... I HOPE My subscription newsletter started off
with a quote, " Tough Times Never Last , Tough People Do ". Well
this is a very good example of that. The stock market might have had
a tough March ... but a month later we are at all-time highs ... and
only" the tough people" are still around.

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If you look at the chart posted below ( iShares Trust FTSE China
(NYSE: FXI) you can see an example of a nice pullback .. if bought
(like some of my subscribers ) you would have made a nice
investment. http://tinyurl.com/25a8lu

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Most of the buying strategies in the CAN SLIM investing model call
for buying into strength. But sometimes you can buy a stock on a
dip. The trick is, you can't buy just any stock on any dip.

This is where the 10-week moving average becomes an important
tool.After a stock rebounds from a test of its 10-week (or 50-day)
line, it creates a new buying range: as low as that line, and as
high as 5% above the previous high, plus 10 cents.

Here's what you need to look for - and guard against.

1. A pullback is no excuse to buy a less-than-perfect stock. The
stock you buy on a pullback must have the same solid fundamental
underpinnings as a stock you'd buy during a breakout from a cup-with-
handle or any other base.

2. The volume rules turn upside down. CAN SLIM investors are
accustomed to buying into strength - higher prices on big volume
surges. If you're buying a dip, you want below-average
volume.Ideally, look for a stock to drift lower as volume dries up.
It should be a quiet, gentle decline, not a panic-driven rush for
the exits.

3. Look for a solid Accumulation/Distribution Rating. You want to
see no less than a C Acc/Dis Rating.

Think of the 10-week line as a safety net. With the biggest and best-
performing funds holding their shares, there's a better chance they
will take advantage of a dip to buy more.But if that Acc/Dis Rating
starts falling apart, those same funds may start unloading. If that
happens, you should sell too.

4. Beware of one too many trips to the well. A stock's first and
second pullbacks to its 10-week line during an uptrend mark the
safest such test. Starting with the third trip to that support
level, a failure becomes more likely.

5. If the 10-week line fails, bail out. If the stock just dips
slightly below it, don't panic. But if the stock crashes through the
line in huge volume, there's no reason to wait for the maximum 8%
loss permitted under CAN SLIM investment rules.

For more information about what CAN SLIM means , and how to become a
better investor by using it ,click this link
http://www.investors.com/learn/c.asp