One of the rules I adhere to as a trader is putting the odds in my favor. How I like doing that is by having a trending stock in a trending sector with a trending market. Another way is having several stocks in a sector trending. For example, take a look at the Investment Brokerage sector.

Investment Brokerage Sector

As you can see the sector has been trending nicely. Taking a closer look, there are several stocks that have performed equally well. This is an indication that there is strong institutional support.

Goldman Sachs

Goldman Sachs (GS) has had a nice push so far this year and over the last week and a half has taken a break. I feel that a break above the Wednesdayââ,¬â"¢s high will start another push to the highs.

Bear Stearns

Bear Stearns (BS) has a similar pattern.

Lehman Brothers

Lehman Brothers (LH) is another Investment Brokerage firm that seems to be ready to make a push to the upside.

As I mentioned earlier, when you get several stocks with similar trending patterns, this validates the institutional support of the sector. After all, being on the same side of the trade as the institutions is what we are trying to do. When you cut down to the least common denominator of what makes a stock move, its supply and demand. Please make sure you use stops to protect your profits and principle.

Tom Incorvia is a swing trader with 18 years of experience in the financial markets.  E-mail him at tincorvia@gmail.com.