Trading up-trending stocks in a down-trending market

October 24th, 2012, 06:44 PM

Hey all --

I have a question to those that trade off daily charts on up-trending stocks while the market indexes are in a down-trend.

Is this a lot more difficult than if the markets were in an uptrend in addition to the stocks that you're trading?

If you can only trade long do you simply stay out until the market indexes are in an uptrend as well before you make long trades?

Thanks,

-Alli

Sent from my iPhone

April 27th, 2014, 05:32 PM

Allistah

Hey all --

I have a question to those that trade off daily charts on up-trending stocks while the market indexes are in a down-trend.

Is this a lot more difficult than if the markets were in an uptrend in addition to the stocks that you're trading?

If you can only trade long do you simply stay out until the market indexes are in an uptrend as well before you make long trades?

Thanks,

-Alli

Sent from my iPhone

Hi Allistah,

There are many reasons for a stock to be in an trending upwards even though the index may be in a strong downtrend. Some reasons could be good earning reports, merger and acquisitions, high beta negativity etc. Define your outs(stop-losses) and stay in the trade as long as stock is not showing any signs of reversal irrespective of what the indices are doing. Dont forget to move up your stop losses as the prices move up. In that case even if the stock reverses you will have some profits and most of the time you can grab up most of the movement of the stock.

What I have seen in my experiences is when you try to reason out with logic, you either have a huge loss or miss a very big profit. Your logic may completely fail. Bottom line is screw up the indices, follow the trend of the stock not the index.

Hope that helps.

April 27th, 2014, 10:31 PM

Allistah

Hey all --

I have a question to those that trade off daily charts on up-trending stocks while the market indexes are in a down-trend.

Is this a lot more difficult than if the markets were in an uptrend in addition to the stocks that you're trading?

If you can only trade long do you simply stay out until the market indexes are in an uptrend as well before you make long trades?

Thanks,

-Alli

Sent from my iPhone

One thing I've learned is that you don't force a trade. If you don't feel confident in the trade don't place it. I would watch how the specific situation plays out and use it as a learning experience rather than put your capital at risk.

Trading up-trending stocks in a down-trending market

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Trading up-trending stocks in a down-trending market