Sorry, these are not trading tips for stocks to buy.
These are trading tips for the process you use to buy stocks, options, ETFs, whatever.
- Have a methodology (trade setup) that you use for finding opportunities.
- Know exactly how much money you plan to risk on the trade.
- Set a stop for how you will exit the trade if it doesn’t work out.
- Set a point at which you will lock in some profits.
- All of this feeds a plan that you follow for the trade BUT most importantly…
YOU have to have the confidence that you will follow that plan and execute according to the plan.
As Mark Douglas says in his book, “The Disciplined Trader”:
“The market is never wrong in what it does; it just is. As a trader, you have to decide what is more important–being right or making money–because the two are not always compatible or consistent with one another.”
Chart of the Day
J.W. Nordstrom released earnings yesterday and disappointed investors on “same store sales”. The stock dropped 10% today on top of a 7.6% drop yesterday. It closed the week at the lowest close since August 2, 2016.