Posts Tagged ‘trading strategy’
Penny Stock Advice is Meaningless Without Trading Discipline
Written by troy on Thursday, April 15, 2010 | No Comments
Categories: Penny Stock Advice, Penny Stock Articles, Penny Stock Strategy Tags: fear and greed, paper trading, Penny Stock Advice, penny stock trader, trading strategy, trading system
Many people are searching for penny stock advice. They are looking for someone to tell them which stocks will provide them with fame and fortune. However, the sad reality is that for many people even if you gave them world’s best penny stock advice they would still find a way to lose money or at least not make what they should.
Too many beginning traders believe that successful trading is only about picking the right stocks. This couldn’t be farther from the truth. The number one thing that will contribute to your success a penny stock trader is whether or not you have put in place a disciplined trading strategy.
I have always had a knack for picking the right penny stock. Unfortunately, in the beginning I did not have a trading strategy in place. This more often than not led me to either enter a stock too early (thereby accruing losses) or to exit a trade at the wrong time (either giving back profits or not fully realizing even greater profits).
This may sound like heresy but I am of the belief that any trading system can be successful. All systems will work if the trader exercises discipline. By discipline I am referring to both a system of managing the money in your account and a system of when to enter and exit trades. If you are trading by gut feel then most of the time yu will doom yourself to failure.
A disciplined trading system helps you overcome the two biggest obstacles that stand in the way of you becoming an expert trader. Those two obstacles are fear and greed. Both of these poisonous emotions will cause you to enter and exit your traders at the wrong time. They can turn the best penny stock advice into a losing trade. These emotions will cause you to act irrationally. They can only be conquered through strict adherence to a trading system.
I have heard many people suggest paper trading for awhile before committing any real money. Although I am not entirely against paper trading I remain unconvinced of its benefit. In trading, you don’t experience fear and greed until you lay your money on the line. When you do everything changes. The best traders are able to treat each trade objectively. They do not fall in love with their trades. Their system enables them to overcome fear and greed.
So do you want some great penny stock advice? Here it is. Before you ever commit one cent to a trade spend some time and develop a trading system or at least adopt someone else’s trading system. And once you have that trading system in place, stick to it at all costs. That is the best penny stock advice that I can give you.
Timed Trading: A Penny Stocks Trading Strategy
Written by troy on Wednesday, January 28, 2009 | No Comments
Categories: Uncategorized Tags: trading strategy
At the start of the day, scan the headlines of the Over The Counter stock press releases, and see if any of the press releases are promising. Pick out one, two, or maybe three penny stocks whose press releases do seem promising, and monitor each stock’s pre-market activity between 9:00am-9:30am.
While monitoring the selected penny stocks pre-market activity, you can also use the time to do a quick research on the penny stocks companies. This is also the best time to quickly scan its history, both recent and not so recent.
If by 9:30 am the market makers have not brought up the prices of your selected penny stocks, then place an order for the most promising of the three initial penny stocks you have chosen. You may choose to invest in just one, or split it between those two stocks, or at most, invest in all three. It is usually best to choose just one penny stock for the day, but if you believe that another stock is about just as promising, you can allocate your investment between two different promising penny stocks.
Use sound judgment when splitting your resources. If the market makers have brought up prices of the penny stocks, it is your call as to whether you’d like to continue day trading or not these market makers could have read the press release before you did, and are expecting more demand for the penny stocks you have selected.
If by 10:30 am the press release regarding the penny stocks you have just invested in is as powerful as you thought it to be, then the prices of the penny stock would have started to go up. More people would have read the press release by now, and even more will get to read it as the day goes by. Just like you, some or preferably a lot of them would think that penny stocks you have chosen would be a good buy, and would start placing orders.
Demand increases the price of the penny stocks. By this time, you must have chosen at what price you would like to unload the penny stock that you bought earlier during the day. Do sell if the price of the penny stock has reached your desired sell price, and avoid holding out for a higher price. Keep your greed in check. The goal here is to make a profit within the day even if it is just a small one and not end with a loss.
At best, you are done trading by midday or maybe even earlier. You scanned the press releases 9:00am, monitored selected penny stocks until 9:30am, bought the most promising selected stock at 9:30am, and sold as the stock prices went up during the next few hours due to the demand created by the press release. Now you have a neat little profit. Just remember to use sound judgment, and to keep your greed in check.
By: Nir Dotan
About the Author:
Nir Dotan is a writer and promoter of
Penny Stocks
services, and
Penny Stocks Preferred source for the latest news and information on the best and brightest Small Cap Stocks.