This morning before 8:00 am the market was completely dead.
Volume had dried up completely.
There wasn’t a single name on our “Watchlist”.
And that was completely fine.
If I’ve said it once, I’ll say it again and again: DO NOT FORCE A TRADE.
Don’t get bored and antsy when you’re day trading — it only creates bad situations.
Think about it this way…
When you’re bored, and are trading just to trade, you aren’t letting price dictate your actions.
You’re just throwing your money into the air, and praying and hoping that something will stick.
You might as well be at the roulette wheel.
Because in the end, what do you think is going to happen?
Do you have anything guiding your trading?
Do you have volume, or trendlines or VWAP breaks?
Or are you just giving money away.
We don’t trade on hopes and dreams because we don’t know what’s going to happen.
Price dictates everything in these markets.
If there’s no earnings, no news, no volume, then we don’t trade it.
The illiquidity will kill you.
Think about the why this is the case.
When you buy an illiquid stock, the buy / ask price is likely to be wide.
People still holding onto the stock with a sell order 10% higher only care about the profits.
And if you buy into a trade where there’s already a huge gap on the trade, you aren’t selling for a five cent loss.
You could be out ten times or more that kind of loss just because of the illiquidity.
Let the trades come to you. Don’t get antsy.
And if you have to wait one, two, three hours, then so be it.
Veru Inc. (VERU) didn’t give people a trade on the bullish side until 11:30 am today.
What would have happened if you would have blown up your account in the meantime?
Probably packing it up for a loss at 11 am when you could have just had some patience and got in at the 11:30 am break.
They say patience is a virtue.
And if you’re going to trade like a pro, you need to have it in every single trade you put in.
September 20 2022