The system uses the weekly charts first to gauge the direction of the market using divergence signals. These signals give a list of stocks that are potentially at the beginning of a significant reverse. Next we zoom into the daily charts looking for an entry using a price action signal supported by momentum or reversal indicators. The reversal signals are more aggressive but offer a smaller stop and larger targets. The minimum risk reward ratio is 1:2. All trades come with a firm stop and target though depending on market conditions a break even move is often made when the trade has hit the 1:1 risk- reward level.

The RSC Stock System for scaling purposes is based on a maximum of 3% risk. For example, on a 10K account we look to risk no more than $100 per stop per trade on a maximum of 3 trades at any given time. I will add another trade if one is available when an existing live trade moves to break even. Please note in order to buy enough stocks to reach the $100 stop size, I do use up to 1.75 in leverage on the account. Once the system trades up to 15K, we will risk $150 per trade maximum and continue to increase this as the system climbs to 20K ($200), 25K ($250) etc. The goal is to keep the losses small and to growth the account 2-5% a month.