55-day breakout entries · 20-day low exits · systematic trend following for liquid US stocks
A Turtle-style trade is not a prediction. It is a rules-based attempt to catch the small number of breakouts that become large multi-month trends, while cutting the many failed breakouts before they become serious damage.
The entry is a daily close above the previous 55-day high. The exit is a daily close below the previous 20-day low. Everything else is there to improve quality, manage risk, and stop you chasing.
The system is designed around asymmetry. Most breakouts will fail, stall, or produce only small gains. A smaller number become powerful trends. The objective is to control losses on the ordinary trades while giving the rare exceptional trades enough room to keep going.
This is why the system should not be judged by whether every signal works. It should be judged by whether losses stay controlled and whether the winning trends are allowed to run.
Buy when the stock closes above the previous 55-trading-day high.
The 55-day high must exclude the current day. The stock has to break above the prior channel, not include today's candle in the channel it is trying to beat.
Exit when the stock closes below the previous 20-trading-day low.
The 20-day low must also exclude the current day. This keeps the exit rule clean and prevents today's candle from redefining the level while it is being tested.
These are the highest-priority names because they have recently triggered the 55-day breakout rule and are not too far above the entry level.
Prefer names close to the breakout trigger. If a stock has already run far above the 55-day level, the system may still be valid, but your entry is late.
Before entering, know exactly where the exit is. If the distance from price to the 20-day low is too wide, the trade may be too difficult to size sensibly.
Near Breakouts have not triggered. They are alert candidates, not entries. They become actionable only if they close above the previous 55-day high.
Active Trends show examples of stocks already following the system. They are useful for study or holdings review, but they are not automatically fresh buys.
Extended stocks can be strong but late. A strong stock with poor risk is still a poor trade.
Potential entry now. Check risk, chart quality and volume before acting.
Set alerts. Do not enter until a daily close confirms the breakout.
Already in trend. Useful to track or study, but not always a new entry.
Strong but probably late. Usually wait for a new base or tighter setup.
Price above both averages suggests the stock is structurally strong rather than merely bouncing inside a broken downtrend.
A rising 50-day average shows that the intermediate trend is improving. A flat or falling 50SMA makes the breakout lower quality.
Trend systems buy strength. A stock near its 52-week high has less overhead supply and is proving demand.
Rising volume and rising OBV suggest participation is expanding. They are not the entry rule, but they improve confidence in the move.
The scanner calculates the distance from the latest close to the previous 20-day low. That is the system exit. If that distance is too large, the trade may be technically valid but practically unattractive.
| Risk to 20D exit | Interpretation | Response |
|---|---|---|
| Below 6% | Excellent | Risk is relatively tight for a trend-following entry. |
| 6–10% | Acceptable | Often workable if the setup is strong and position size is adjusted. |
| 10–15% | Stretched | Be careful. Position size may need to be much smaller. |
| Above 15% | Poor / high risk | Usually too late unless there is a specific reason to accept wide risk. |
| Mistake | Why it is a problem | Better response |
|---|---|---|
| Buying Near Breakouts early | The signal has not triggered yet. | Set an alert and wait for the close. |
| Chasing Extended names | The exit is often too far away. | Wait for a new base or cleaner risk point. |
| Taking profits too quickly | The system depends on rare large winners. | Let the 20-day exit rule manage the trend. |
| Ignoring exits | Small losses can become large losses. | Respect the closing break of the 20-day low. |