One of the biggest mistakes a trader can make is to keep trading in order to not miss the "bounce". This market has continually gone down with periodic upside spikes. Unless you are a very astute trader, this market will wear you down as well as the funds in your trading account. The only index that looks somewhat appealing is the Russell 2000 and the only reason for the latest spike (from what we can figure) is the huge move in financials (many of them now fall into the small cap category). Unless you think financials are coming back anytime soon..there are no safe havens.
We do not want to leave things on such a sour note! This chart on Dryships (DRYS) that we mentioned last week looks like a great risk/reward setup. You can trade this stock with a stop just below 70 (3 points downside) with a possible upside of 30 points (price target 100). Let's see what happens as we could get stopped out quickly in this volatile trading environment.
1 comment:
What I cannot understand is how this stock trades 5 times earnings and also has a $40 to $60 spin off waiting in the wings !!
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