Cole - Firstly, 800% in last years ... or this years market is good, but.... it really depends on the capital you start with. Say you are starting with $1000, if you increase that to $8000, you are up 800%. But if you start with $10000, you need $80000. Although it appears that there is little difference between the two, what you should look for is a track record of picks. It is easy for some of these people at SI to claim 1500% because they bought a $1 stock and sold it at $15. It happens so often on SI here, it is laughable.
Look for a track record and for people willing to share their picks as they make them, and then as they sell them..... win/lose/draw. We will all make mistakes....most of us up to 50% of the time. How we learn from them and the changes we make because of them determines how we will succeed or fail in the future. Mostly though, surround yourself with those that you trust that are most like yourself.
That is what we have hear on this thread. The regular contributors, I believe, will say that they trust each other. With most of them here, if they say "TJ, news on XYZ right now .... get on", and I don't have the time to check it out, I would trust them. I have gained great trust and respect for most here. Those that don't fit our mold here, don't stay long. We admit our mistakes, do not blame each other for our losses, and try to help each other out whenever possible. No one here is a guru, but with collective effort, we succeed as a group.....usually. There have been two great failures in the past: PRFM & ASCT. Both however had great runs with plenty of opportunity to get out with significant gains. Each of us had to choose our own exit points, some made big money, and others lost big money.
To answer your question:
I am big into pyschology of the markets. I do not fight the general trend. I will sell winning positions into a NAS fade and buy recent weakness into a NAS rally. I do love breakouts from a base as you mention as well and consider volume THE indication to look for that usually preceeds a breakout. MLG and PSQL are two that I am watching very closely right now for that. AFCI is another good one. I do not get greedy, and usually sell too soon. I constantly ask myself "How much is enough?" (a line from the movie "Wall Street"). I love to play resurgence stocks as I call them. Recent high flyers that fall from grace and base out, only to be rediscovered after a couple weeks.
I really love to value trade now too, with the market darlings into significant weakness. DELL at 35, ORCL at 22, CPQ at 23, etc. Where the money runs from, it will eventually run back too, especially if it is a "darling". Not enough traders give psychology enough weight IMO. Most technical analysis comes down to psychology, not the other way around.
Watch the next time the fed raises rates, which may be in May. Chances are, I believe, the will raise .25, and the market will sell off in a hurry. Fear of inflation, cost of funds, growth, etc .... all fear factors and it will cause a sell-off regardless of the current rally indicators or strength.
I don't give many traders credit for being smart as much as they are quick. The beauty lies in finding the issue that everyone has forgotten before they remember it. For this reason, I have stayed out of the big Inets, they are the first to fall and the first to rise. But the smaller Inets lag just a bit in both cases, and some gems get forgotten entirely during an extended rally, like we are in now (IATV). Most of it is in psychology and discipline in my book.
I also trust my gut feeling. Over the years of trading, your gut learns more than your mind. Your mind can make you believe what it wants, but it can't fool the gut, listen more often and watch the results.
I hope this helps somewhat. But, I can't stress enough that I value the input of everyone on this thread tremendously, and thank them for their continued support of what we are doing here, it is the group that makes the biggest difference.
Tj |
