I learned a VERY important lesson
- Thread starter cashmoney69
- Start date
Instead of starting another thread, i'm going to add to this one, but its not about gaps.
lesson 1. Dont buy on round numbers, they are probably important resistance levels for other traders.
lesson 2. Dont forget to read the news!!. I bought two tech stocks today: SYNA and RHAT. The tech sector was the hardest hit today because of the GDP report, which again, I knew nothing about. shit.
lesson 3. Dont take momentum for granted. Many stocks will fizzle just as quickly as they rise.
lesson 4. If you dont day trade..wait. Wait until about 11-12pm, after lunch is a reversal period...buy at the lows instead of sitting through a pullback the rest of the day.
lesson 5. If a stock trades 650k shares average, and there's no pre-market volume.....there must be a reason why. Dont be a sucker.
lesson 6. Dont keep changing your orders. If you feel the market is pushing you around emotionaly...walk away. (I'm going to have a problem with this one).
cm69
lesson 1. Dont buy on round numbers, they are probably important resistance levels for other traders.
lesson 2. Dont forget to read the news!!. I bought two tech stocks today: SYNA and RHAT. The tech sector was the hardest hit today because of the GDP report, which again, I knew nothing about. shit.
lesson 3. Dont take momentum for granted. Many stocks will fizzle just as quickly as they rise.
lesson 4. If you dont day trade..wait. Wait until about 11-12pm, after lunch is a reversal period...buy at the lows instead of sitting through a pullback the rest of the day.
lesson 5. If a stock trades 650k shares average, and there's no pre-market volume.....there must be a reason why. Dont be a sucker.
lesson 6. Dont keep changing your orders. If you feel the market is pushing you around emotionaly...walk away. (I'm going to have a problem with this one).
cm69
I would say you need to set up procedures before you purchase any stock. Once you find the stock that appeals to you technically you must.
1. read the company news
2. find out their next earnings reporting date
3. find out what they do to make money and if their financial position is improving or getting worse.
Never trade without knowing those three pieces of information if you are a swing or position trader. You still need to know the first two no matter what type of trader you are.
1. read the company news
2. find out their next earnings reporting date
3. find out what they do to make money and if their financial position is improving or getting worse.
Never trade without knowing those three pieces of information if you are a swing or position trader. You still need to know the first two no matter what type of trader you are.
The gambling/trading is certainly a fine line. I believe the difference is risk management.
Here's my logic on the backspread instead. You're speculating on a move in either direction because historically earnings move a stock quickly in one direction or another. With this strategy you're going to profit on a big move in either direction. If the stock doesn't move, you can close your spread without a massive loss.
I'm not saying that this is a perfect strategy, but seems to offer a higher level of risk management.
Here's my logic on the backspread instead. You're speculating on a move in either direction because historically earnings move a stock quickly in one direction or another. With this strategy you're going to profit on a big move in either direction. If the stock doesn't move, you can close your spread without a massive loss.
I'm not saying that this is a perfect strategy, but seems to offer a higher level of risk management.