5 Reasons to Start Trading Today
Too often, emotions weigh on our objective judgment and market perceptions.
The right mindset is critical to success in the markets — and psychology plays an important role in winning the battles.
Remember, markets are not GOOD or BAD…they just are. Sometimes they move up and sometimes they move down. But opportunities arise every trading day for those prepared to profit.
These are the best times in history for individual investors! Here’s why:
- Electronic trading has leveled the playing field. Access to opportunities is unprecedented with Stocks, Commodities, Options and Currency markets at your fingertips 24-7.
- Liquidity – Sellers when you want to buy and buyers when you want to sell.
- Tight Bid/Ask Spreads – Many stocks and options now trade in penny increments compared to the eighths before decimalization that made entry and exit much more expensive.
- Low Commissions – The old days of expensive transaction costs are over. It’s easier than ever to put more money in your account than your broker’s. Commissions should perform a positive function in preventing overtrading or emotionally chasing markets.
- Disciplined Execution – Being able to plan a trade and trade the plan gives you the power to succeed.
Perspective is important when weighed upon by market misses.
The markets are capitalism at its finest. No store to open or stock to shelve, no employees or products to push. And most importantly you set the hours!
Start small and develop your trading skills with low dollar positions. Initially, the process of developing good habits is more important than profits.
The key is to develop a trading methodology and risk tolerance that you are comfortable with. Experiment with strategies and techniques to find what works for you.
Once you find the right method, it is just a matter of adding zeros… building bigger positions without changing your method.
All you need is a positive mindset and faith that your trading discipline will provide the success you desire.
Keep it In the Money,
Chart of the Day: Can the president pump up this stock?
As I noted earlier this week, the spotlight is back on the biotech sector following the president’s Covid-19 diagnosis.
While his battle with the illness might not be completely finished, Trump is already touting a “cure” thanks to his Regeneron Pharmaceuticals Inc. (NASDAQ:REGN) treatment. The president even pumped this stock, along with Eli Lilly & Co. (NYSE:LLY) in a video posted this week on Twitter.
Earlier this week, we were already starting to see how investors are reacting now that treatments offered to the president appear to be working. The biotech sector perked up, with the iShares Nasdaq Biotechnology ETF (NASDAQ:IBB) jumping more than 5% so far this week.
But what about the Covid-specific plays like Regeneron? Can the president’s “endorsement” send this stock to new highs?
Judging by the chart, REGN still needs to find a little more momentum to make that a reality.
From my vantage point, REGN needs to post a decisive break out $620 to really get moving. From there, it’s another 7% to get back to its July highs.
As of Thursday afternoon, the stock was still encountering some strong resistance at these September highs. Even with the little bump, it looks like this stock will need a more than a quick message from the White House to recapture those highs…
— Greg Guenthner