In today’s issue of Traders Daily Direction, I want to discuss how to get into the proper mindset when you’re preparing to place a stock trade.
It’s not enough to just have a stock in mind… You need to have an overall plan and know how to maintain the discipline of that plan.
Trading as a lone actor rarely works. This is why I use my market data analysis that tracks what is developing in each and every stock leading up to their inclusion into the Watchlist.
This gives me the edge of knowing how many traders are getting in on a trade before we look to enter ourselves.
And this edge is all thanks to my Stock Surge Indicator (SSI) system.
The SSI takes market trading data from thousands of stocks and identifies stocks with the top scores.
These are then further winnowed for the best stocks that we can present to you each and every week inside Traders Daily Direction.
For those of you that have recently joined us, I strongly recommend making sure that you are up to speed on my SSI system.
You don’t need to know the math or to do the calculations – but you do need to understand how it works and why.
This will empower you to be able to buy into the surge stocks with more confidence.
To get up to speed on my SSI – please download for free and read my special report: The Magic of the Stock Surge Indicator.
So far this week, the Watchlist is doing pretty well.
All three of the stocks are positive, with Diodes, Inc. (DIOD) up by 2.42% and NVIDIA Corp. (NVDA) up by 5.49%…
And the week is still young.
Now, remember that trading is a predatory game.
Those who have a plan and act accordingly are like the predators stalking their prey.
And all of the stocks on our Watchlist are set up as perfect stocks for predator traders. Read on for what I mean by this…
The Ultimate Apex Predator
Lions are the ultimate apex predator. But despite their deadly reputation, not every hunt is successful.
When hunting solo, lions have a kill rate of just 17%. In other words, they only catch their prey in one out of every six attempts.
When they hunt as a group, their success rate goes up to one in three.
During a night hunt, their odds are even better. And in areas with tall grass, the rate of success jumps to above 50%.
This is where the lion has an edge.
Trading is not much different…
Buying stocks based on gut feelings and whim is unlikely to achieve a high rate of success.
Choosing from a filtered list of names with strong fundamentals will improve your results.
Further screening for those in confirmed uptrends will lead to additional success.
And buying the best of those when they are breaking out of tight consolidation zones should tilt the odds squarely in your favor.
The difference between traders and lions is that traders don’t get hungry.
There is no reason to ever force a trade out of desperation.
Lions must feed every three or four days. Otherwise, they will starve.
But we can go weeks or even months without a kill.
That is our edge. And it is our biggest advantage as traders.
I’ll leave you with one of my favorite quotes.
It comes from a legendary trader named Stan Weinstein:
“Although the cheetah is the fastest animal in the world and can catch any animal on the plains, it will wait until it is absolutely sure it can catch its prey…
It will wait for a baby antelope, and not just any baby antelope, but preferably one that is also sick or lame…
Only then, when there is no chance it can lose its prey, does it attack. That, to me, is the epitome of trading.”