LogFAQs > #939139174

People have the stock market all wrong because they don't know how to extrapolate.

It goes down, people think "prices are low, time to buy!"
It goes up, people think "prices are high, time to buy!"

Then they end up wasting their money when the trend continues lol.

No, you gotta watch more derivatives. If it's gone down a couple days in a row and it's getting worse every day, it's time to consider selling to cut your losses. If it's gone up a couple days in a row and it's getting better every day, it's time to consider buying.

Of course, if you're trading individual stocks instead of managing an account, you don't have that kind of inertia.

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