Warning Warning Warning:
Another one made another 2 biggest fatal mistakes in stock trading:
Saturday, June 18, 2005
A very important lesson for all students:
IIJI: regarding this volatile stock.
Please refer to our daily chart and dates to fully understand this story.
The first day I recommended IIJI for day trading was 5/27/05, Price
from $5.00 went all the way up to $14 on 6/13/05. A 180% increase in
11 trading days.
In between, I picked IIJI for few more days for Day Trading. I never
recommended this stock for Swing Trading. This is a very volatile
stock and it was good for day trading alone. The last day I pick IIJI for
day trading was 6/13/05.
On 6/14/05, it had its first big drop and on 6/17/05, it had 33% drop in
one day.
Any of my student with my real time daily chart will not go long on
6/16/05.
6/17/2005
This lady saw IIJI moved up so much in the past for couple weeks and
when it gapped down from $10.70 to $8.04 (a gap down of 25%). She
assumed it was the time to buy. She bought 15,000 shares that was
$120,000 (if bought at $8.00). This stock dropped 33.46% for the
day. Obviously she did not want to cut loss and kept over the
weekend. (A true gambling style).
This lady never contacted me before. All of a sudden she sent me
email and left phone message for help.
2 Fatal Mistakes:
1. How high is too high and how low is too low are not determined
by small investors like us. I always tell my students in my private
lesson that: we, the small investors, follow the market closely based
on the real time charts with my entry patterns. We never try to buy at
the bottom (we do not know when it reaches to the bottom), we buy at
a confirmed uptrend with volume, we never chase any stock either.
Your opinion or my opinion about a stock do not mean anything.”
2. Never putt all the eggs in one basket.
I believe this sad story is a great information for all my students to
know.
I do not know what good advice I can give her for her difficult situation.
She confirmed with me for a private lesson. I will use this stock for her
lesson. She will never make the same mistake in her life again.
Here is her email to me (Name withheld)
From: "xxx
To: TraderHuang@gmail.com
CC: xxx
Date: Sat, 18 Jun 2005 01:51:20 -0400
Dear Mr. Huang,
Thank your return my e-mail on time, I need your help very much.
I bought one stock today, It is very bad luck, the stock name is IIJI, I
lost $20,000 in one day.
I have 15,000 shares right now, I really don't know how to do on
Monday sell or hold? could you please give me any advice I will do
anything to thank you.
best wish/ xxx
________________________________________
6/19/2005 12:17 AM
I did gave this lady an hour of urgent lesson tonight. I explained her
situation by using my charts.
Warning
Important Notice
| This Door of opportunity may close suddenly |
Biggest Mistakes
 |
| |
 |
| |
 |
| |
 |
| Be Careful |
| Never put all the eggs in one basket |