Swing Trading: Own a Portfolio of Strategies Rather than a Portfolio of Stocks
With the stock market selling off aggressively on Thursday, and the Dow dropping by more than 400 points, traders that do not have short selling strategies in their trading arsenal are being reminded of why it is important to have them.
As Larry Connors reminds traders at every opportunity, the difference between the professional trader and the amateur trader is that the professional trader has strategies in place to deal with a variety of market conditions, while the amateur trader is preoccupied with market direction.
This is one of the reasons why Larry advocates that traders develop an objective, “portfolio of strategies” rather than a “portfolio of stocks”. A portfolio of strategies will include ways for the trader to make money when markets are rising, falling and moving side to side. A portfolio of stocks provides only one way for the trader to make money: rising markets.
Learn more about building portfolios of strategies in the upcoming free trading webinar presented by TradingMarkets and The Machine. Click the headline below for more information.
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Here are 7 Stocks You Need to Know for Friday.
Two of the biggest sell-offs were in the energy patch, with shares of both ^HAL^ and ^WMB^ pulling back by more than 10% ahead of trading on Friday.
A number of formerly high-flying stocks are now pulling back into oversold territory above the 200-day moving average. These stocks include ^AAPL^ and ^CMG^. Both stocks also finished lower for a third day in a row.
What’s up on a down day? Shares of ^EK^ gained more than 14% to close higher for a second day in a row. The stock has finished in overbought territory below the 200-day moving average for the past two sessions.
Also making gains on a big selling day in the stock market are shares of retailer ^HOTT^. The stock gained more than 6% to close at its highest level since the beginning of the month.
^HPQ^ announced plans to spin off its PC-making division on the same day it reported quarterly earnings that were better, but forecasts that were worse, than expected. Shares of HPQ, which have been trading below their 200-day moving average since February, fell by 6% in Thursday’s session.
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David Penn is Editor in Chief of TradingMarkets.com