[...] fast so the game plan for the morning, yes game plan (you should all have one as I pointed out in THIS post) was to watch for any weakness and short the weakness. At the market open we got a slight [...]
Top Reasons Why Traders Fail
You Listen To Others & Not Yourself
Not making your own decisions is costly in trading. Sure you can listen to what someone has to say about certain stocks but when it comes down to making a trade it is ultimately YOU who needs to make the decision. Other individuals are often times unreliable and irrational. Listen to yourself and make sure you’re comfortable with your own choices.
You’re Not Prepared
The night before or in the morning of the next trading day have your watchlist put together and ready. Know your specific price points you’re going to buy or short at. I know it sounds crazy, but you shoud visualize the trades and plan your trades when they reach certain points. This will make it that much easier when all hell breaks loose at the opening bell @ 9:30 a.m.
For you Thinkorswimmers: Those people shorting penny stocks with the brokerage Thinkorswim better be prepared first thing in the morning (7am eastern) to reserve those shares in those hard to borrow penny stocks. If not you might not have any shares to short on that day.
You Don’t Have A Strategy
If you’re one of those wreckless traders who just sees a stock going up and says “that looks good because it’s going up, i’ll just buy it here” – then I’ll feel really sorry for you then……and later when you don’t have any money left in your account. Come up with a simple strategy so you’re not blindly throwing money around. For me, it’s simple – I only buy breakouts and short pump and dumps. Come up with yours today!
You Don’t Understand The Market
Most people don’t realize what aspects of the market affect your selected stock. Any press release, world, or economic news can take your stock down in an instant. There’s nothing you can do about it but every trader needs to be aware of what can happen. Down here in penny stock land hype and manipulation control most of the price action in these particular stocks, and is part of the reason why it’s so simple to profit down here in the “gutter”. On the flip side, you need to understand what happens during hype and manipulation and what it does to penny stocks to actually reap these easy profits.
You Don’t Have The Right Tools
If you’ve read my eBook, You know I’m a huge believer in having the right tools to trade with. For me, I have the perfect brokerage, different scans, stock charts, quotes, etc. It’s important that you have whatever tools are necessary for your trading niche. For some day traders that means having L2 quotes, for others it means having a chart with 5 min time intervals. Simply put if you dont have the needed tools, you’re trading will suffer.
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$596 Profit In 30 Minutes Shorting Penny Stock SCON | Penny Stocks | Penny Stocks To Watch
April 21, 2009
Max Dence
February 17, 2012
As we have discussed previously in our series entitled “Top Ten Reasons Why Retail Traders Fail” the majority of account meltdowns occur because of a very simple principle being overlooked or ignored. These “common sense” indicators are often seen as too primitive or basic to actually be effective and are therefore pushed to the back of a traders mind when in fact, those are the very things that should be at the forefront of their trading plans.
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