Tuesday, December 28, 2010

Never get cocky

Just wanted to point out a couple of charts from today. Here is a 5 min chart (covering 3 days) of a stock till 3:45 PM today. Down less than 2% for the day. Minding its own business.

And here is the same chart, with the last 15 minutes of the trading day included.

Ended over 14% down for the day. Even if someone had stops in place, chances are one got a bad fill. I just checked and there was no news related to the stock, to justify such a drop, well at least not yet anyway. Just wanted to say that never got cocky. Always respect the markets. You might have had a great day or a great year, or might be on a hot streak, but always remember your place with respect to the markets. Be humble and gracious when you are running hot and feel like you can't place a trade wrong. And always, please always, exercise proper risk management.

Take care and good luck!

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