Low priced stocks and TA?

[cashclay]

Can TA be applied to low priced stock (1-5$) as you would apply TA to higher priced stocks? Some people have told me that stocks in the lower range tend to move differently and that TA is much harder to apply.

 

[wrbtrader]

Stocks move differently to each other regardless to the price.

Anyways, if you're successful with TA on higher price stocks...you should be successful with TA on lower price stocks because the trader is still the key in using TA regardless to the method or price of the stock.

 

[debitspread]

Why don't you post some charts of low-priced stocks in the Chat room and ask for reads?

 

[Handle123]

If low price stocks have light volume, doesn't matter what you use whether charts, TA, or mixture of both, Light volume is going to be tougher to get in and very often tougher to get out. Often times you can get large range bars on little volume cause there was no trading in the middle. To me, better to go with stocks that trade millions like X(US Steel), have dividends and options. Lighter volume stocks are going to have unusual charting. When a stock is making highs and lows, you like to know if was done on heavier/lighter volume and not cause someone could not get out cause no one would take other side except a buck away.

I know many younger traders who are undercapitalized will trade these types of stocks, but they often hurt themselves by trading stocks that will have huge slippage.

 

[cashclay]

Do you guys find that psychology plays an important and significant role while trading. For example when getting into a stock and being 100% confident that the stock will move in your direction as suppose to the opposite. For some reason this seems to me a somewhat important indicator. Sometimes ill get into a stock and be totally afraid and weary and it would almost be in compliance with my emotions. Some traders told me to tkae emotions out of the equation and remain almost zen like when both losing and winning money. How does this approach fair with you guys?

 

[wrbtrader]

Do you guys find that psychology plays an important and significant role while trading. For example when getting into a stock and being 100% confident that the stock will move in your direction as suppose to the opposite. For some reason this seems to me a somewhat important indicator. Sometimes ill get into a stock and be totally afraid and weary and it would almost be in compliance with my emotions. Some traders told me to tkae emotions out of the equation and remain almost zen like when both losing and winning money. How does this approach fair with you guys?

If you're not using automation...

Of course psychology plays a significant role in trading because you're basically a discretionary trader...someone not using automation.

You can not "remove" emotions from your trading. In contrast, you can learn to "manage" your emotions resulting in you being a discipline trader.

 

[Redneck]

Do you guys find that psychology plays an important and significant role while trading.

An absolute vital role

For example when getting into a stock and being 100% confident that the stock will move in your direction as suppose to the opposite.

The times I've been the most confident price would go my way - are the times - I've lost my ass the most

Get comfortable not knowing..., get comfortable with uncertainty


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The absolute worst condition / situation for a human to make a decision in..., and take action on - is one where there no hard fast anchor point..., where conditions are changing..., where a hard..., fast..., decision must be made on the fly..., then the appropriate action taken

This is exactly where we must set aside our emotions and excel

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Some traders told me to tkae emotions out of the equation and remain almost zen like when both losing and winning money.

Removing emotions cannot be done - we're human

Try to remove breathing..., eating.., drinking..., thinking - it is impossible

Learn to function is spite of whatever emotions exists - people in other professions do it all the time

How does this approach fair with you guys?

Serves me well

RN

 

[Redneck]

If you're not using automation...

Even then - some find it impossible to not monkey with the program..., or when to run / not run the program


RN

 

[cashclay]

The reason why im also writing this is because some professionals have told me that they like to feel the trade out. They say this is a major part of their trading strategy, the ability to feel the trade as it goes along.

 

[viktor_k67]

Can TA be applied to low priced stock (1-5$) as you would apply TA to higher priced stocks? Some people have told me that stocks in the lower range tend to move differently and that TA is much harder to apply.

Check volume. If daily average volume is below 1M shares per day, then I would say you may ave real problem with applying TA to it. Low volume stocks are more sensitive to stock's manipulation by the company itself. Plus, gaps in trading will disorder the majority of technical indicators.

On the other hand, high volume stocks and ETFs could be used in TA. Examples: UWTI, SUNE, CHK, DUST, WLL, SIRI and etc.