Understanding Alignment: Why All 4 Must Agree

What Is Alignment?

Every stock's score is calculated across multiple scoring components. The alignment score (0 to 4) tells you how many of those components agree on direction.

• 4/4 — All components bullish (or all bearish). Maximum conviction.
• 3/4 — Strong agreement, one component lagging.
• 2/4 — Mixed signals. Some components disagree.
• 1/4 or below — Conflicting signals. No clear edge.

Why Alignment Matters

A stock can have a high overall score but low alignment. This happens when some components are strongly bullish while others are still bearish — or vice versa.

High score + high alignment = The trend is confirmed across all components. High conviction.

High score + low alignment = The move may be short-lived. One or more components haven't confirmed yet.

Reading Alignment Signals

4/4 Alignment — Full Agreement

When all four components agree, the trend is strong and broad-based. These are the highest-conviction setups.

• Momentum is confirmed across all scoring dimensions
• Pullbacks within this trend are usually shallow
• The trend is likely to continue until alignment breaks down

3/4 Alignment — Almost There

One component is lagging. This often happens when:

• A new trend is forming (some components lead, others follow)
• A trend is mature (faster components are rolling over while others hold)

Action: Still tradeable with high confidence, but monitor the lagging component.

2/4 or Below — Mixed Signals

Multiple components disagree. The stock doesn't have a clear directional bias.

Action: Wait for alignment to improve before committing capital. Mixed signals lead to choppy price action.

How Alignment Changes Over Time

Alignment tends to follow a pattern:

1. New trend starts: Faster-reacting components turn bullish first (1/4 → 2/4)
2. Trend confirms: Additional components follow (2/4 → 3/4)
3. Full trend: All components agree (4/4)
4. Trend ages: Faster components roll over first (4/4 → 3/4 → 2/4)
5. Trend ends: Most components reverse

The best entries are often at the 2/4 → 3/4 transition — you're catching the trend as it's being confirmed but before it's fully priced in.

Using Alignment in Your Trading

For Long Entries

• Look for stocks with alignment 3/4 or 4/4 in bullish regime
• Enter on score dips with alignment still holding

For Exit Signals

• Watch for alignment dropping from 4/4 to 2/4
• This often precedes a score decline by several days

For Watchlist Building

• Add stocks transitioning from 2/4 to 3/4 alignment
• These are the "about to move" candidates

Key Takeaways

• Alignment measures how many scoring components agree on direction
• 4/4 = maximum conviction, 1/4 or below = stay out
• The best entries come during alignment transitions (2/4 → 3/4)
• Dropping alignment is an early warning sign of trend exhaustion

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Check alignment for any stock on the WSOB Leaderboard — it's displayed right on the table.