Only buy stocks that go up

You are looking at a stock, debating whether to buy it or not.

The company is going to release earnings before market open tomorrow, and people are all expecting a negative surprise. Many research analysts have a SELL or HOLD rating on the stock.

Similar companies had not done too well in the last quarter. Stocks down. Current market conditions likely to affect this company the same way.

Five minutes left till market close.

You have to make a decision. 

It’s a risky buy because of all the news, but the last few earnings have all been good. There have been concerns about the overall economy lately though. Experts expect the bubble to pop anytime.

Eh, something tells you it’s going to be good. You can’t really put your finger on it, but you are certain it’ll go up tomorrow.

But, then again, it might not.

All these news articles are not very optimistic. Reading through them is making you uneasy about the purchase.

Two minutes left.

You enter in your order to buy $1000 worth of shares. Not too much, and if it goes down more than 20%, you’ll sell and use the losses to offset your gains.

The price is fluctuating all over the place.

Speculators are making their bets.

Order type: market buy. There’s no time to do a limit at this point.

Sixty seconds.

You glance at the headlines one last time. A new one has just popped up. You open it up

Forty five seconds.

Summary: Doesn’t look good. Sentiment is negative. Advising to sell.

Fifteen seconds.

Go back to your order. Whoa, the stock just ticked down 1%.

You thumb hovers over the confirmation button.

Market closed.

Phew. Stock dropped another fifty basis points just before closing.

Good thing you didn’t buy, seems like the last second sellers may know something.

 

The next day, the company releases earnings.

Positive surprise with increased guidance for next quarter.

The stock opens 17% higher than yesterday’s close.

DANG IT!!

Should have placed the order.

  • We’re all experts in the stock market of yesterday.

 

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