Waiting for things to shake out…
Last Thursday was just plain nasty but with it being the day before a holiday it was, as expected, extremely light volume. Chart wise, the indexes look to be in the process of breaking out a right shoulder in an intermediate head and shoulders top. But until things become clearer big picture wise I won’t push trades in individual stocks. Right now I am looking for possible shorts in individual names if we get a bounce, but I will remain opened minded. Sorry for the lack of picks, but when it comes to trading many times the best alternative is to protect your capital and wait for a spot where the odds in your favor.
I am still trying to drag together material from previous posts on other sites but a good book on getting started with a similar style to the way I trade is James DePorre’s Shark Investing. It gives a good introduction into technical analysis and is a great background to understanding the psychology of the market and advantages of the small investor.
When you talk about a small investor, how much starting capital would you recommend?
was out of Jazz with stop loss, damnit, today its doing v well !
congrats to those who still held some JAZZ as it skyrocketed to $5.00 today. I am all out of JAZZ now. Well I would recommend at least 25k to avoid having to deal with SEC trading limitation bullshit. Under that you will just have to be very selective and look for only the best setups, i.e. ones you are willing to put a large percentage of your portfolio in, take gains quickly and protect your capital at all costs. Under say 10k, this would be even more important because if you trade loose and take alot of stops your performance is going to be grinded away by transaction costs, as well as having to deal with SEC trading restrictions.
Matt I can attest to what Jax is saying there. I have just under 10k in my portfolio and I can usually only manage to make one or two moves a week because of the size of moves I have to make. Plus etrade doesn’t free up funds after a sale for a day or two. It’s a struggle.