Before You Make The Trade, Remember This

  • September 16, 2003
  • Tim Truebenbach


This market is on fire! 
It spent last week consolidating gains and just completed a
very positive
session as the major indices raced higher on heavier
volume than yesterday (not shown). This
is a good sign as it shows nice, recent accumulation.

 image src=”https://tradingmarkets.com/media/2003/Tim/tt091603-01.gif” width=”418″ height=”348″ />


image src=”https://tradingmarkets.com/media/2003/Tim/tt091603-02.gif” width=”418″ height=”348″ />

Individual
stocks have been setting up but have
been slow to push through resistance. United
Online
(
UNTD |
Quote |
Chart |
News |
PowerRating) is an example. The stock is
approaching a multi-year handle with a pivot
point of 40.72.

 image src=”https://tradingmarkets.com/media/2003/Tim/tt091603-03.gif” width=”418″ height=”348″ /> 

J2
Global
(
JCOM |
Quote |
Chart |
News |
PowerRating) continues its unparalleled ascent. 
The stock split 2 for 1 and has since gone on to hit new highs.

 image src=”https://tradingmarkets.com/media/2003/Tim/tt091603-40.gif” /> 

There are many ways to buy
stocks and try and get in on a potential winner, but the most important thing
to remember is to have an exit strategy
present before making the trade. The most
important aspect to this is to eliminate potential greed or fear. Most
of the time, we buy a stock such as Ask
Jeeves

(
ASKJ |
Quote |
Chart |
News |
PowerRating) and as it ascends, it is easy to sit on hands and not sell. Then
the stock takes a hit and fear sets in as we panic our way out of it when the
stock is going through a simple correction.

 image src=”https://tradingmarkets.com/media/2003/Tim/tt091603-05.gif” width=”418″ height=”348″ /> 

Whether you are buying stocks
now in anticipation you are holding a big winner, or looking for a quick
trade, it is important to distinguish that beforehand.

Right now it is more
important to watch out for stocks setting up like
Dynacq
(
DYII |
Quote |
Chart |
News |
PowerRating) and
Gilead Sciences
(
GILD |
Quote |
Chart |
News |
PowerRating). This
is normal risk associated with stocks and can happen before a stock proves
itself through breaking out. 

 image src=”https://tradingmarkets.com/media/2003/Tim/tt091603-66.gif” width=”418″ height=”348″ />


image src=”https://tradingmarkets.com/media/2003/Tim/tt091603-70.gif” width=”418″ height=”348″ />

Keep focused on the telecom,
Internet and medical sectors as some of the best stocks are coming from these
groups.

Until Thursday,


Tim Truebenbach

P.S. Please feel free to
email me at timt@tradingmarkets.com