follow your gut feeling to buy. you got more than 75% chance being right in this kind of market. 100% up room to go.
I bet you anything that your problem is the need to be 100% positive that every trade is going to work out. Now here is the problem: trading is based on probabilities thus you cant be sure that any trade is going to ever work out. Ok don't get alarmed by that statement because just as there is zero chance of making money on every trade there is zero chance of losing money on every trade. Its really a Bell Curve and its your experience with the market in choosing your trades that determines how far you can get to the ends of the bell curve when it comes to % winners. Now, lets say your a pretty good stock picker. You have the experience, the eye, the instinct etc. You see tons of plays but your a classic micro manager who has to make sure everything is perfect before you enter, thus you find a way to talk yourself out of every trade because you can always find one thing that rings in your ear that says wait this is not good. If that is the case stop right now and pack it in because I guarantee you will give up your account over the long run to other players who dont do this. Now for the good part: Lets say you are good at stock picking and your problem is entering there is a very easy way to fix this silly problem. I call it a silly problem because once I explain it you will see how much of an illusion this fear you have really is. Number one...get it out of your head that you are waiting for the perfect trade to put all your money on and double up your account in one trade. This is not No Limit Hold em folks. Number two...look at your account size how much trading capital do you have? This is important because excellent money mgmt can artificially move you along the bell curve without having as much experience as the next guy. Figure your trading with 50K tell yourself I am not willing to risk more than 500 dollars per trade if I get stopped out. Then of course you can determine your share size rather easily per trade. Now also have a certain quota on the number of trades that your willing to hold at one time. Lets say 3 is your max that you can manage effectively. Now you have nothing to worry about if your a good stock picker probabilities will work in you favor over time. Will you get stopped out and lose. YES YOU WILL...IN THIS CASE ITS LIKE POKER you will lose but u want to get in on the flop as cheaply as possibly and press when you have the advantage. So with your 50K you do this for 3 months and you build up the mental capacity to begin trusting yourself because you now know there is no one trade that will cause your to go broke. There is no more fear. In 3 months with good stock picking lets say your account is up to 60K. Very nice job you made 20% on your account now you can move your loss per trade to 600 and maybe your might even be willing to hold 4 trades at a time. Rinse and repeat. It takes years to build up a solid account in the hundreds of thousands its not an overnight phenomena. Those who tell you how great they did because they put it all on one trade are begging to go broke over time. It will happen. You cant call "all in" in No limit poker everytime and think your going to walk away a winner. Here is a little insight in to me. I have an account with 500K in it. I traded RIMM today, bought it at 99.5. You know how many shares I bought? 500 shares thats it. Not 10k shares just 500 shares. You know why? Because RIMM is a fast stock and my target was 4 points higher and I got it. I made 2k I wasn't excited or scared in fact the trade bored me to death. You know why? I didn't give a hoot about getting stopped out for a 2 buck loss if I was wrong. in fact the 2 dollar stop was under broken resistance. There are thousands of trading opportunities every month play the odds and crush them over time piece by piece. In fact here is a trade I wrote up for a friend of mine after hours and emailed to him. I bought 2500 shares of this today. Its INTC I wont lose a wink of sleep tonight if I get stopped out Monday. This trade cant dent me and it wont make me rich it will just make me money if it works out. Thats all you have to do make a little money at a time many times over. I hope some of this advice helps you out.
It cost me a lot of money to overcome this problem - it's simple. When you completely accept the risk and responsibility of trading your own money, understand that the market is neutral, realize that the key to trading is probabilities over time and have lost enough money to become immune to the emotional aspect of trading - then you won't hesitate any more. Learning curve claimed by many traders is 6 months (rare) to a few years (common) to never (also common) Good Luck, Paul
Don't trade? Hey, I'm really serious... I don't mean to quit trading. Just don't take the trade but understand and accept your responsibility. It is... important to embrace your discretion, rather than deny it... again... discretion... Don't torture... Embrace!... again... discretion... not some psycho-BS emotion stuff....
Example: IPIX today: Found it at 5.0 - but thought it is already too late ... In general I hold it during the day for 1 - 2 hours.
That should do it...lol...can't stop laughing The statagey could backfire though -"Like I'm trying to buy this stock, but eveytime I look over at that wet fish I start laughing again and can't get my order placed because I'm ROFLMAO."