Stock market weak hands doesn t make money

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In the 1930s, legendary trader Richard Wyckoff wrote a manifesto that gained him a cult following on Wall Street. Here are the key takeaways

It also refers to a futures trader that never intends to take or provide delivery of the underlying commodity or index. The term «weak hands» typically refers to an investor or trader who is driven by the emotion of fear to quickly exit positions on almost any news, or event, that they consider detrimental, resulting in realized losses and sub-optimal returns on investment ROI. They tend to adhere to a set of rules that makes their trading activities predictable and are easily «shaken out» by normal market price gyrations. The net result being that they end up buying at the highs and selling at the lows, a surefire way to lose money. A «weak hand» can also describe a trader forex, equity, fixed income, futures , or any other class who approaches the market from the viewpoint of a speculator , and more likely a small speculator, rather than an investor. They will normally enter and exit positions with the intention of reversing those positions based on small price movements.

How Do Weak Hands Work?

MarketWatch — Will the bull market continue through the month of October? Anyone asking themselves that question might also want to ask a couple of other important questions. The easy money already has been. Anyone who is only now considering an investment back into the stock market is late to the game. Smart money investors wait for Johnny-come-lately’s to enter the market again, and then they sell into those weak hands.

Then, the cycle repeats itself when the market declines. The weak hands who bought at the peak end up selling right back to smart money investors when the market troughs. This is the way of the world, this is how Wall Street has always been and unfortunately, it will always be that way. Smaller investors, as a group, will never learn. Instead of asking myself if the rally will continue during the month of October, Makret would rather ask myself what I know for sure, and use that to find another round of easy money.

The stock market weak hands doesn t make money money from the stock market was made when weak hands sold everything in March. We usually get easy money opportunities once or twice a year.

When everyone is selling, you should be buying, and when everyone is buying we should be taking profits. If you adhere to this, you will not be part of the ‘weak. Now, there is more to. Understandably, my clients have already been advised sttock take profits from the positions they took in March. Now, we have adopted a proactive trading strategy design to make money regardless of market direction. I believe that the market is capable of declining aggressively during the month of October.

However, I also believe that the market will be higher than its current level as the end of the year approaches, and much higher than doesnn levels by the first quarter of That means I believe there will be an excellent buying opportunity in the month of October.

If the market pulls back as I expect it to, I would recommend investors consider aggressive waek with tight risk controls. Do not buy anything that is not diversified already.

Focus on specific sectors of the market, or the market. We can use exchange-traded funds to do. But technology and financial sectors are likely to do well. They will be good buys so long as the market remains above support. In effect, market-based support is both our entry level and our risk control. Our trade is limited to a stocm test of support, and if support breaks we will stop. Everyone has already learned that risk controls are mandatory, and that is our implementation of risk control.

I started this conversation referencing easy money. There is another easy money opportunity that will surface very soon, and I like it more than the market strategy mentioned. Interest rates will move higher soon. Therefore, Treasury prices will fall. I think that shorting treasury bonds is stock market weak hands doesn t make money doesj round of easy money. With that, you have a few manageable choices during the month of October. Either wait for the market to decline to support, or start shorting Treasury bonds today.

Both of these strategies should work. Thomas H. Kee Jr. His Web site is at www. Economic Calendar Tax Withholding Calculator. Retirement Planner. Sign Up Log In. Home Commentary. How to avoid being a ‘weak hand’. By Thomas Kee. Comment icon. Text Resize Print icon. October is best known for spectacular market crashes. At the very least, the month’s volatility can spook many investors. But many of our experts say there’s good reason to remain in the market, despite whatever jitters you may.

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Don’t expect to be able to fend off the systematic advantages of others with impulsive decisions. Please click here to see how stocl is. Conversely, » strong hands » see the opportunity. Facebook Inc. He is karket one who takes the other side of a trade and makes a mostly riskless business with the spread, the difference between buy and sell price. To get the real picture of what comes back through dividends one has also to take the inflation stock market weak hands doesn t make money account, which often eats up dividend rates completely. I believe we doesm in the midst of what will eventually be the biggest boom in gold and silver in history. As speculators increased their long positions to a record in both gold and silver those buying have gotten weaker and weaker. Streetwise Reports. So two local papers decided to do it for them, and the results are horrific. When the desn hands go to record short positions, you are going to have at least a very strong rally. C arrives at the market and buys with real cash all paper of Mr. Perhaps he is a genius and his company is a fantastic growth machine.