================================================== =======
UNDERSTAND THAT THIS IS A METHOD DESIGNED FOR THE NEWBS -- THE ONES WHO PM ME EVERY DAY ASKING IF I CAN HELP GET THEM OUT OF THE BAGS THEYVE GOTTEN STUCK IN BECAUSE OF ENTERING A STOCK ON THE EXCITEMENT OF THE MOMENT, WHICH AINT THE WAY TO TRADE TO MAKE PROFIT IF YOU HAPPEN TO BE A NEWBIE !
================================================== =======
IM SICK AND TIRED AND IM NOT GOING TO TAKE IT ANYMORE !
Josy, I know exactly what youre saying and this little lesson is designed to correct that situation --- and maybe put a stop to the incessent pounding and pumping and talking about the bad and the ugly stocks that goes on so much !
In all the groups, all over the web, touts and pumps and outright lies are spread every day about stocks that will move, have moved, should move, are long term, short term, middle term or have come to term and whatever else can be imagined and expressed on the internet !
I have no need to explain how and why this all happens, because my intent is not to explain the market, its manipulators or its very real dangers, but to offer the newbs a simple and easy way of making money in this wildly chaotic business we indulge in !
Here in our own chat room and on the site, PROMISES are made that may or may not actually come to pass (my feeling is that most don’t !) and
based on the number of times something is repeated, newbs get suckered into a stock they should not be in, that is too volitile for them to be able to follow with their limited knowledge or just plain a POS that only the most experienced traders can possibly survive ! In other words, they get the shaft !
So the following is for the newbs –– those traders who have already gone through this stage need to read no further, but if your buying and selling (or NOT selling) looks like this little chart, you need to pay attention or dig a deep hole somewhere and throw the rest of your money into the pit or send me a message on my email and I’ll tell you where to send your excess dollars !
So, what does this little chart show ? Notice at point A, AFTER the stock has been rising for some time, our imaginary newbie trader enters, NOT WANTING TO MISS OUT ON THE MOVE THAT PEOPLE ARE SHOUTING ABOUT FOR A FEW HOURS !
Unfortunately, the newb does not recognize how close to the top of the stocks move they bought at, and now holds as the stock goes through a normal selloff for profit taking and market makers covering their shorts and does one of two things –- the most horrible being an exit in panic,(AT POINT B) not being able to handle the bleeding and the loss any longer !
If by some happy accident, the trader has held to POINT C, the trader jumps ship as soon as the stock reaches their breakeven point, missing the resultant continuation move that the experienced traders knew was coming ! Unfortunately for our newb, this upside reversal of the stock may never happen, and the stock slowly sinks further and further down, resulting in phenominal losses ! Of course, all during the next selloff, well, and not so well, intentioned people keep saying to buy more, because the price will never be this low again –– do that, and you will get to know just how low a stock can go !
Many of the reasons the newb holds is because he/she continuously hears the stock being touted as a “long term investment” in the chat room, and as I said, some of these actually are but the overwhelming majority are not and will never be –– unfortunately, the newb hasn’t a clue as to what information is right or wrong or how to verify or confirm what they are hearing !
Presently, CHDT is one of THOSE stocks, having suffered through a tremendous retracement off its prior rally and now being told it’s a long range hold –– in my opinion, as long as the stock maintains its upward trend line (as it is presently doing) the stock is worth holding if youre already in it, although I cant tell you how long it could take for you to breakeven or possibly make a profit ! The stock is also a very good “range” play, buying at support and selling at resistance waiting for the promised breakout, FOR THOSE WHO KNOW HOW TO PLAY THE GAME – – – – – –
but Ms. and Mr. Newbie, YOU aint that trader ! NOW, WHY DO YOU HAVE TO SUFFER THIS WAY, heartsick each time the stock drops and praying each time the stock moves up, not really knowing WHAT will happen to the bag youre holding and so scared that you ask everyone you meet, including your grandmother, how the stock is doing and what’s their opinion on it
YOU DON’T !
I know its bad because I get constant PM’s and emails from you all, always asking and I know a number of traders who have bailed CHDT and a few who have lost VERY big dollars on its drops ! Presently, I’m not adversely commenting on CHDT because it IS riding an upwards support trend line and showing trader interest, but only presenting it because so many people are in it because they didn’t sell at the top of the rally, or worse yet –– bought at the top !
So that’s why im sick and tired of the bleeding and the pumping and the touting and the confusion that wrings each dollar out of the newbs, leaving them bleeding and dead
BECAUSE THEY CANT SEPARATE FACT FROM FICTION and this is an open message to ALL the pumpers, be their intentions good or evil, to SLOW DOWN the amount of touts and give our newbs a chance to become seasoned traders ! I guess what I’m really saying is – – – – –
GIVE THE NEWBS A BREAK AND SHUT UP ALREADY !!!!!
OK, promised that I would help, and so I shall keep my anger bottled up for a moment and tell you how to survive as a newb, until you can stand on your own two feet and make decent decisions as to what stock you want to buy and how you want to trade it !
I cant take the credit for this, as it’s a system in use by most good traders and taught by
Toni Turner, in her world class book on trading, “A Beginners Guide to Daytrading Online” and her companion books on the subject. I personally consider her the best instructor on beginning trading in the world because of her knowledge, known abilities, care and her LACK of testosterone and attitude, allowing one to see the market as the business it is and not as a battle between adversaries !
So, here are my newbie rules for good trading !
ONE – DO NOT ENTER ANY STOCK THAT IS BEING TOUTED IN THE CHAT ROOM OR ON THE SITE ! TWO – DO NOT CHEAT ON RULE ONE ! IF YOU’RE A NEWB AND STUCK IN SOMETHING, YOU ALREADY KNOW THIS IS “WORTH ITS WEIGHT IN GOLD” ADVICE THREE – DO NOT BUY A STOCK THAT HAS JUST HAD A SIGNIFICANT RALLY ! FOUR – ONLY HAVE 5 OR 6 STOCKS ON YOUR WATCHLIST THAT YOU HAVE SELECTED OR GOTTEN FROM TRUSTED BOTTOM PICKERS --- ADDITIONALLY, DO NOT ADD ANY NEW STOCKS UNTIL YOUR LIST HAS MADE ALL ITS MOVES -- CONCENTRATE ONLY ON THE ONES YOU HAVE ! FIVE – ******* ONLY BUY A STOCK THAT HAS BOTTOMED ACCORDING TO SOMEONE YOU CAN TRUST AND TODAY, RIGHT NOW, IS MOVING PAST ITS PRIOR DAYS CLOSING PRICE !
SIX –– SELL AT THE HIGHEST PRICE ON DAY 2 OF THE STOCKS MOVEMENT !
SEVEN –– SELL AT THE HIGHEST PRICE ON DAY 2 OF THE STOCKS MOVEMENT !
EIGHT – - SELL AT THE HIGHEST PRICE ON DAY 2 OF THE STOCKS MOVEMENT !
OK, SOME EXPLANATIONS MAY BE IN ORDER – – – – – –
(1) DO NOT ENTER A STOCK THAT IS BEING TOUTED on the boards or in the chat room, no matter how excitedly –– invariable you will find that you’re entering LATE, on the SECOND DAY of a move and danged close to the HIGH OF THE DAY, only to see the stock drop later in the day as the market makers prepare to take the stock lower in anticipation of the gap tomorrow, so now the gap has to BE HIGHER than your entry price if you are to make anything !
If you look at a chart of that stock, with a volume indicator below it, you will see TREMENDOUS volume –– that volume contains both buyers AND SELLERS, and is usually the greatest volume the stock will see for some time ! What happens the following day is that the stock gaps up at the open, the remaining sellers pile out immediately after the gap (and some scalpers rush in for a few minutes action) and then the stock DROPS LIKE A ROCK, past your entry point yesterday, and youre back being a stuckholder again !
the slogan over at the AMEX is "opportunity created fresh daily !" --- YOU WONT MISS THIS STOCK, CAUSE THERES 40 MORE COMING OVER THE HILL AT THIS VERY SECOND !
Please note, there are many wonderful stocks touted on these boards and by excellent stock pickers, BUT if you are to succeed, you MUST follow this simple system, learn what stocks do and then, in the future, you can consider other ways of playing the game !
(2) DO NOT, UNDER ANY CIRCUMSTANCES, THINK ABOUT CHEATING ON RULE ONE !
If you break Rule One, and come to me complaining, I will cut your heart out with a rusty gardening implement and feed it to Shakerzz and his cohorts in an omelet !
While money can be made, and the 3rd day “gap play” is a very nice way to trade for those traders with a bit of experience, YOU AINT READY FOR IT YET SO FORGETABOUTIT ! ! ! ! ! ! ! ! ! !
(3) DO NOT BUY A STOCK THAT HAS JUST HAD A SIGNIFICANT RALLY ! Once a stock has rallied and sold off, NORMALLY its tired as are the traders and one has to wait for it to gain attention, strength and trader interest. NOT ALL STOCKS WILL DO THIS, and ACTC is one with a tremendous trader interest, but its volitile as can be and no place for a newbie ! One only needs to look at XKEM after its rally to understand what I mean !
(4) DO NOT HAVE MORE THAN 5 OR 6 STOCKS ON YOUR WATCHLIST ! Just how many stocks do you, as a nebie, REALLY believe you can follow at the same time and just how many of them will you be able to play ? This one is simple common sense !
(5) ONLY BUY A STOCK that is coming off its bottom and IS PRESENTLY MOVNG PAST YESTERDAYS CLOSING PRICE –– using indicators is handy, but if you don’t know how to use them, A STOCK THAT MOVES PAST ITS PRIOR DAY CLOSING PRICE
AND CONTINUES MOVING UP THRU THE 9:50 REVERSAL PERIOD, COMING OFF A BOTTOM IS, ALL AVERAGES CONSIDERED, INVARIABLY GOING TO MAKE MONEY FOR YOU !!!!
These are 2 day swing trades, so you can afford to
wait till a little past 9:50 to see IF THE STOCK IS REALLY GOING TO CONTINUE MOVING UP ! As an extension of rule 4, If at all possible, ONLY buy a stock in an uptrend. That way, if you get stuck the stock is moving in an uptrend, or at the very least in a straight sidways move, it offers you a chance, just down the road, of getting out unscathed !
Thanks Mike, just how in the Blue Hell does one find a bottoming stock in an uptrend ?
These stocks are referred to as
“channelers” or “rollers” and provide a fairly predictable manner of trading for the newbie and the new “swing” trader. I refer to them a lot and they can be found on “stockfetcher.com” either by “pattern matching” (where you take one stock and stockfetcher finds 20 more moving the same way) or by going through stockfetchers “stocks moving in a channel”.
For bottom plays, i simply take the low values of the TER analyzer and perform a search on stockfetcher using all of them.(THERE ARE ONLY 3 YOU NEED CONCENTRATE ON -- just set them to "under 10" !) You can also look for "stocks closing below the bollinger bands" and i even find them in any standard scans that have "52 week low" -- Vipyr finds them by looking for the drangonfly doji, and then waiting for the stock to move.
Only as an example, I offer the folowing chart to show what one of these dudes looks like !
Whereas these are excellent plays, they should be the second type of trading you indulge in, not the first !
(6) – SELL AT THE HIGHEST PRICE ON DAY 2 OF THE STOCKS MOVEMENT !
I know –– you wouldn’t need my help if you knew how to do that !
Well, there is “mikeys method”, but that is probably a tad too complex for most of you at this moment, so JUST ADD THE RSI @ A VALUE OF TWO (2) TO YOUR REAL TIME INTRADAY CHART AND WHEN IT REACHES 100% on DAY TWO,
SELL THE SUCKER !
There is little more to tell, because I promised it would be easy, and it doesn’t get much easier or more secure than what I’ve put down here !
Follow this exactly, not falling for GREED ("I JUST KNOW it will go up further !") and I promise you will be making money –– you may miss the tops of some moves, but you wont be caught at the bottom, and for a newb, I consider that to be far more important !
Once you gain confidence and learn a lot more, you can strike off on your own, trying anything offered and working with your own methods and abilities, but do this system for a few months and watch your account grow –– isn’t that the best kind of “on job training” there is ?
AND NOW A SHAMELESS PLUG FROM OUR SPONSORS – – – – – – –
I’ve come up with a new analyzer, named after my trading partner TER and its so simple to use and offers such amazing insight that I will shamelessly pump it here !
http://www.stockhideout.com/mike-par...-analyzer.html
My weekly moderator watchlist (most supplied by TER) are “wait and see” picks, small in number and have an enviable track record over the past month and a half –– if you had entered any one of them when the stocks price moved over its prior day close, you would have done very nicely ––– and since they didn’t all go off at the same time, you could have picked up at least two or three in a week (assuming you have to let your trade settle for the three day settlement rule !)
There are a number of BOTTOM PICKERS on this site –– get to know them and analyze and study their picks BUT remember DO NOT ENTER IF THE STOCK HAS ALREADY MOVED –– YOU WANT TO ENTER AS THE STOCK IS BEGINNING ITS MOVE, NOT BEFORE (there may well be MORE downside) AND NOT AFTER !!
Best of luck to you all and,
Enjoy and trade well,
mp