You first need to answer these elements of the trade. What
is your trigger, where is your stop, where is your target, what
time frame are you going to trade, what is your risk to reward, how
much capital are you going to risk on the trade, and possibly do
the market conditions appear appropriate for the trade. If
you know those answers then you can determine if the trade is right
for you. There is always a trade, but is it right for YOU.
That's the real question.
I guess my issue on this one is CMG has been a momentum stock
and if it suddenly breaks higher in a big way, can you handle and
properly manage that loss? That's why this trade needs a proper
plan laid out with proper risk to reward scenarios pre-planned.
When you do that, you're good.
Hope that made sense. Merry Christmas. john
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CMG
Posted by zwyss on 23rd of Dec 2011 at 04:39 am
I think rp brought this trade idea a couple of days (or weeks?) ago.
Could this be a good opportunity now to short?
Opinions?
It could be? This is how you should really strive to answer it, imho.
Posted by johnc on 23rd of Dec 2011 at 09:50 am
You first need to answer these elements of the trade. What is your trigger, where is your stop, where is your target, what time frame are you going to trade, what is your risk to reward, how much capital are you going to risk on the trade, and possibly do the market conditions appear appropriate for the trade. If you know those answers then you can determine if the trade is right for you. There is always a trade, but is it right for YOU. That's the real question.
I guess my issue on this one is CMG has been a momentum stock and if it suddenly breaks higher in a big way, can you handle and properly manage that loss? That's why this trade needs a proper plan laid out with proper risk to reward scenarios pre-planned. When you do that, you're good.
Hope that made sense. Merry Christmas. john