The Nasdaq 100 seemed to be looking at a sharp down day on Friday, Oct.25
after Amazon' released earnings after the bell on Thursday that fell well short of analyst expectations.
In after hours trading Thursday night, AMZN had fallen over 100 points so the bearish case seemed to be playing out as expected
However, after a brief opening dip, a peculiar thing happened to all that bearish sentiment in NDX Friday morning
Amazon started to rise ,and kept rising back throughout the day to finish well off its low.
Sellers who unloaded on Amazon 100 points lower found themselves completely fooled
selling the bottom, when instead they should have been buying.
When the crowd' "thinks" something is going to happen,
90 % of the time, the exact opposite happens the market.
That is why it is said that up to 90 % of traders lose money trading stocks.
That is the harsh downside that few traders would ever admit to.
In reality, on Friday I personally was extremely fortunate.
I was buying AMZN Friday morning at 1671 in pre-market
and then selling at 1740 later in regular trading hours
I perceived correctly that traders bearish bets would blow up in their faces,
once the real market opened for trading at 930 EDT,,, and buyers stepped in.
Now the lessons learned here should be simple.
Pure educated logic more often than not fails in the stock market.
Markets usually go up, when you expect them to go down, and go down when you expect them to go up.
The irrational takes hold, and that in turn can go on a lot longer than most traders expect.
So next time you're ready to place that very big trade that you know is a winner,
take a step back, and think of the consequences of your actions.
And Buy when you think its a sell. And Sell when everyone else is buying.
What's so difficult about that ?
THE_UNWIND
10/26/19
NEW YORK
after Amazon' released earnings after the bell on Thursday that fell well short of analyst expectations.
In after hours trading Thursday night, AMZN had fallen over 100 points so the bearish case seemed to be playing out as expected
However, after a brief opening dip, a peculiar thing happened to all that bearish sentiment in NDX Friday morning
Amazon started to rise ,and kept rising back throughout the day to finish well off its low.
Sellers who unloaded on Amazon 100 points lower found themselves completely fooled
selling the bottom, when instead they should have been buying.
When the crowd' "thinks" something is going to happen,
90 % of the time, the exact opposite happens the market.
That is why it is said that up to 90 % of traders lose money trading stocks.
That is the harsh downside that few traders would ever admit to.
In reality, on Friday I personally was extremely fortunate.
I was buying AMZN Friday morning at 1671 in pre-market
and then selling at 1740 later in regular trading hours
I perceived correctly that traders bearish bets would blow up in their faces,
once the real market opened for trading at 930 EDT,,, and buyers stepped in.
Now the lessons learned here should be simple.
Pure educated logic more often than not fails in the stock market.
Markets usually go up, when you expect them to go down, and go down when you expect them to go up.
The irrational takes hold, and that in turn can go on a lot longer than most traders expect.
So next time you're ready to place that very big trade that you know is a winner,
take a step back, and think of the consequences of your actions.
And Buy when you think its a sell. And Sell when everyone else is buying.
What's so difficult about that ?
THE_UNWIND
10/26/19
NEW YORK