Investing In Stocks
You and I both know there are no guarantees on how to make money on investing in stocks. From which stocks to buy, through when to buy or sell, the variables. You can only do your homework and believe your investigations are sound. There are three stock market trends that you may not be aware of and they are detailed below.
DEAD CAT BOUNCE: This is the effect seen when a stock price rises after a sustained period of downward movement. Often people start to buy again thinking the turn around has happened and then the stock drops even further.
What does it mean for me for stock trading? Because no one can predict when a decline will reverse don't rush in. But it may provide you a window to make trading gains while the stock is in this pattern.
A BELLWETHER STOCK: This is a predictive stock, one that usually indicates where the market is going to head.
Why is this important to me? These stocks usually have a large percentage ownership by institutional investors - the big boys on the scene. While these stocks may signal the direction of the market they may not be the most attractive investment choice for those wishing to make gains. They are useful to watch however to get a feel of what might happen next.
THE JANUARY EFFECT: This is the effect that sees the beginning of a new year heralding higher stock prices in January. It has been attributed to tax factors and to investor sentiment. People often unconsciously expect prices to rise in a new year.
Why is this important? The effect has historically happened and continues to do so. What has changed is that it has become harder to capitalize on this effect. The most important fact may be just being aware of it. If you are aware and watching you may give yourself the chance to take advantage of an opportunity that comes up. - 23159
DEAD CAT BOUNCE: This is the effect seen when a stock price rises after a sustained period of downward movement. Often people start to buy again thinking the turn around has happened and then the stock drops even further.
What does it mean for me for stock trading? Because no one can predict when a decline will reverse don't rush in. But it may provide you a window to make trading gains while the stock is in this pattern.
A BELLWETHER STOCK: This is a predictive stock, one that usually indicates where the market is going to head.
Why is this important to me? These stocks usually have a large percentage ownership by institutional investors - the big boys on the scene. While these stocks may signal the direction of the market they may not be the most attractive investment choice for those wishing to make gains. They are useful to watch however to get a feel of what might happen next.
THE JANUARY EFFECT: This is the effect that sees the beginning of a new year heralding higher stock prices in January. It has been attributed to tax factors and to investor sentiment. People often unconsciously expect prices to rise in a new year.
Why is this important? The effect has historically happened and continues to do so. What has changed is that it has become harder to capitalize on this effect. The most important fact may be just being aware of it. If you are aware and watching you may give yourself the chance to take advantage of an opportunity that comes up. - 23159
posted by X - Men @ 6:38 AM
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