Europe is a mess…
Inflation in the U.S. is getting out of control…
And our leaders are failing us.
We've done so many bailouts over the years we're virtually tapped out.
An economic slowdown hurts the biggest companies in the market. They're just too large to get out of the way. Great companies like Apple, JPMorgan, and Nike are getting smoked.
Pro Tip: Avoid large caps. Their businesses are the most affected by negative macro headlines and economic hiccups.
2. Everyone's Waiting For A Bottom
While stocks may seem oversold.
If everyone is waiting for a bottom, guess what will happen?
Stocks will continue to sink.
That's just the psychology of the markets. It does the opposite of what people expect.
Furthermore, bottoms are impossible to spot.
In fact, it's when all hope is lost and investors have thrown in the towel that's when stocks can begin to recover.
In other words, we need to see more pain.
We haven't seen a true capitulation yet, and until that happens, expect things to remain bumpy.
Pro Tip: Buy-and-hold strategies are the worst in this market and should be avoided for the time being. Hoping for a market bottom is not a strategy. Instead, look for quick trades and lock in profits when you get them.
3. Traders Have Not Adjusted Their Strategies
When market volatility picks up as it has been, you must change some things.
For example, if you usually trade in 200- share position lots, you have to downsize to 50 or 100-share lots. This will allow your trades to have more breathing room.
If you stick to your normal trade size, you can easily get stopped out in a volatile market.
Also, with the market making so many twists and turns daily, you've got to quickly be in and out of trades.
It pays to be nimble in this market.
There's a time to be greedy, but this isn't one of them.
Pro Tip: Scale down your position sizing to adjust for volatility. Don't try to be a hero. Instead, be nimble like a cat.
How To Win In This Market
- Stick to trading small-cap stocks not impacted by the macro-headlines.
- Only trade stocks that have catalysts
- Take profits quickly and don't hold any overnight positions.
Now, if you're looking for a place to find winning plays, you're in luck.
The Breaking News Chat has been doing it on the regular…
Take today, for example, this 101% winner in the ticker symbol MOTS.
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