Beware of the gaps!
Price gaps in the stock market are more common than in the currency market or the precious metals market. Dangerous and crushing business. It is impossible to insure yourself against gaps in the stock market, but you can reduce the likelihood of getting into a price gap. For example, trading in indices can be relatively calm, because there the price gaps (gaps) are usually small.
If the stock is not expensive and has not previously fallen instantly in price, then the probability of a gap is reduced. However, no one can give you guarantees. Read the news about a particular corporation is very appropriate. It is possible that you can find out in advance that something is wrong with the corporation.
Forex Stock Trading Strategy – Safe Pyramiding
This method of trading is considered the most effective. Its essence is quite simple. A trader buys a stock, for example, for $ 50, and then buys another 50 dollars for 50 cents. On the first transaction, he puts a stop – order at the breakeven level. This trading technique is the most effective in the stock market. For example, in Forex, it is practically useless, because currency charts rarely move in the same direction for a long time period.
Such pyramids can be built long enough, although you need to show common sense and scalp profits from time to time.
How not to get bored in the stock market?
Many speculators after the foreign exchange market in the stock market feel uncomfortable. They become … bored! Although, it’s much better to earn and miss than to have fun and part with your money. But not everyone thinks so. Some exchange players come here for the game, for adrenaline. Of course, the stock market may not seem to them the place where you can get the release of hormones in the blood. Although, when buying inexpensive stocks of huge volume, you can experience decent stress. By the way, positive stress is also dangerous. Making huge profits, the trader experiences joy, but joy can cause serious harm to health.
What stock exchange to trade on? European or American stocks: what to choose?
If we talk about market liquidity, it is the American market that looks much better than any other market in the world. So it was in recent decades, so it will be until the end of our lives. All talk of a “Chinese miracle” is empty and meaningless. You can buy Chinese or Brazilian stocks, which can soar in price, but the likelihood of a gap in these markets is very high.
If a trader is attracted to “exotic”, then you can trade Japanese or European securities. And yet: American stocks are the best for speculation.
As a rule, professionals close 2/3 of transactions “in plus”, and 1/3 – “in minus”. Although you can be successful, and making a profit in 1/3 of transactions. You just have to make huge profits, and losses are scanty. There are traders who close over 90% of transactions with a profit. One such exchange speculator is Ahmet Okumus. He came to New York from Istanbul and quickly got rich. His trading method is very original. Oculus buys those securities that have become unreasonably cheaper. If the shares fell, for example, to $ 7, and according to Akhmet’s calculations, they cannot fall in price below $ 6, then he buys them and holds them until victory. Okumus could achieve a better result than in 90% of transactions, but why? He needs profit, not positive statistics. If the stock does not go up for a long time, then he gets rid of it and buys another security.
Of course, Okumus has a huge staff of workers who monitor the situation, check the accounts of a particular corporation and draw conclusions. You are unlikely to handle this approach.