The Best Time to Buy and Sell a Stock
Having the ability to know when to buy a Forex Brokers is also the beginning of the battle. Knowing when to sell a stock is neither the end. But if you only know these two important things and you master how to time them right, you will have better chances of beating the market and hopefully of achieving financial freedom.
When you’re trying to determine which the best buy is, you have to consider many things, such as your goals, your risk tolerance, and others. The same is also true for when you plan to sell stocks. In this article, we’re going to discuss the best time to buy and sell a stock.
Find a tradable pattern
Finding a tradable pattern means you can clearly identify support and resistance levels. The moment you spot that particular pattern and if it repeats itself over and over again over a certain time frame, you can quite be sure that it’s a candidate for a trade.
And remember that you are not looking for a certain stock, but a certain pattern. Time and again people are concerned about the best stocks to buy. However, in the world of trading, you should be more focused on finding the best patterns that have the highest percentage of predictability to buy.
Even though it may be a paradigm shift for you, remember that you are trading patterns and not exactly stocks.
Determine your profit and loss exit level
Imagine this: you managed to identify Finance Brokerage FSMsmart and it’s probably going to soar as high as the sky. Then, you buy it and invest in it. Now you’re in the trade and what you suspected will happen just happened, and it seems like it’s cocked back to catapult higher than you first expected.
Now, you buy more of the stock…and then it falls, lands hard, and buries itself deep in the ground.
In this part, it goes without saying that you are required to know when you are going to close down the trade and lock in the profit you have already achieved if the stock just did what you think it will do. In other words, you need to have a predetermined exit strategy in case the stock turns around and bite you.
How do we know when it’s already time to sell? The moment you spot a tradable pattern, which should include a clear and well-defined support level (where you buy at) and a well-established resistance (where you should sell at), then you should act at those two levels.
If you are buying at the support, you should be selling before the resistance level.
Piecing them together
Overall, rather than attempting to find the best stock to trade or invest in, you need to find the best patters with the greatest predictability to trade and invest in. After you have identified a traceable pattern, you should be strategizing your entry and exit into the stock based on support and resistance that you have spotted from reading the stock chart.
Before you enter a trade, you need to be sure to know when you are getting out if the stock reaches a certain level.