NEW YORK ( TheStreet) -- When you invest in a market that is extremely overvalued fundamentally, momentum trading takes over. When you employ a buy-and-trade investment strategy for a specific stock the reason to buy does not have to be based on valuation, it can be based upon momentum. In either case you use a good-til-cancelled limit order to buy weakness to a value level and once long, you use a GTC limit order to sell strength to a risky level.On Aug. 23, I wrote Apple Has Mojo, Google Does Not and this was after Apple (AAPL - Get Report) ($467.71) became overbought on its daily chart and had tested my annual pivot at $510.64 on Aug. 19. Buy-and-trade investors thus had the opportunity to book profits at $510.64 as an annual risky level. To keep its mojo status Apple needed to have a close above $510.64, but that did not happen.
Apple Lost Its Mojo
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