Back on the 18th of this month I told you that Apple Inc (NASDAQ:AAPL) was trading in a price range of $83 to $100 a share. It was a pattern that had been ongoing since last November.

I said…

Here’s my big, bold prediction: AAPL is heading south. Short AAPL (or buy a put option if you’re feeling saucy) and ride the sucker down to $83 a share.

That’s a nearly 20% profit.

Always remember to play it safe by having a stop-loss before jumping into the play.

Check out this chart to see if this pattern played out…

As you can see, Apple soared past $100 and is now sitting at $108 a share. The call was wrong which is why it’s so important to place a stop-loss with every trade you make.

What’s the correct stop-loss to use? When pattern trading I usually look for a 5 to 1 reward/risk relationship.

So in the Apple example, if I expected gains of 20% then I’d place a stop-loss of 4% to keep myself safe.

Remember, losses will ALWAYS happen; it doesn’t matter if you are Joe the Plumber or Warren Buffet. But what separates the good from the great is the ability to get out of a losing position quickly and get into a winning one.

On February 4, I first warned that Google was running out of steam and about to drop.

Then on February 9 I said this.

Google might go up another week – but not pass its trend line resistance at $400 (if it passed $400, I would bail out of my short). It might try to get above, but should fail and drop to $275 or less by summer – a 31% fall.

A month later Google dropped to $289. You would’ve made a healthy 23% gain.

So I hope you pay attention to what I say next about Google Inc. (NASDAQ:GOOG).

What I want to show you is a little timing trick that relies on the 20- and 50-day moving averages.

Every time the 20-day crosses under the 50-day, you sell shares short. And when the 20-day rises above the 50-day, you buy shares outright.

By following this strategy, you would’ve made 43% when the first bearish cross happened in late June of 2008 until the beginning of this year.

Later, when a bullish cross happened (in early January) you would’ve recently sold out of that position roughly flat.

But today, another short-sale signal was triggered by this technique.

Here’s your suggested play: Sell Google short and use a point above the moving averages (like $340) as your stop loss to protect yourself.

If Google takes another leg down (as this very basic system shows it should), we could see Google shares trade for $250 per share.

But finally it looks like ADM has turned a corner and is set to push higher over the months ahead.

As you can see, ADM has risen nearly 100% from its mid-October lows. While that’s a great rally, the real bullish signal is coming from the fact that ADM just broke above its 200-day moving average.

The 200-day moving average tends to be one of the strongest moving averages you can use as a support or resistance line. Usually, when a stock breaks above this long-term moving-average, it signals more gains to come.

To keep this play safe, all you have to do is enter a stop-loss about 10% under 200-day moving average. If ADM drops 10% under that average, it’s safe to say that the bull run will never materialize.

If ADM is on a real bull run, you could end up riding ADM shares back up to their previous highs by this time next year.