The volatility in today's stock market environment spells opportunity for the savvy investor.
For example, during a recent trading day Pine Ridge Holding (PINR) started the day even, traded down 10% through lunch, and then exploded to a 100% gain by the end of the day.
While a 100% gain in a single day is extraordinary, it is not uncommon to see a stock reverse its trend in intraday trading. In fact, it happens everyday. Timing these reversals is the key to success in trading a volatile market.
Watch for the opening movement in a stocks price. If the stock gaps down at the open on no news, you may be able to expect a reversal to positive territory. Likewise, a gap up without news may suggest a rumor is impacting the stock price, and later trading may see the share price drop.
The biggest mistake traders make in both these circumstances is to "chase" the stock. In early morning trading a panicked seller may see the gap down as bad news, only to see the stock close up for the day. On the other hand, an irrationally exuberant trader may see a big gap up as a trade opportunity and end up buying the stock at the high of the day.
Eventually, every trade learns that volatility is a double-edged sword.
At one point you can be up 10-20% in your trades, and by the end of the day find yourself in negative territory. To succeed in today's stock market environment you need to learn how to move in and out of stocks quickly, and to time your trade entry and exits with laser beam precision.
Do you want to discover the secret to making huge profits in the stock market?
Download this: Success Resources
Phillip Collinsworth co-hosts a website dedicated to teaching people how to take profits out of the stock market. To learn more about his stock trading system, please visit: http://www.penny-stock-advisor.com
Reuters - British bank Barclays is in talks with Lehman Brothers to buy its core U.S. broker-dealer business, including equity, fixed income, M&A advisory and other parts, people familiar with the matter said.
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