Trading is more human psychology than skill in most cases and Praxair (PX) is a prime example of this. When watching stocks around the $100 level, it is known upon professionally traders that if a stock can break out through the $100 level on strong volume and hold above it that day, that all one must do is put their stop under $100 and let it ride. Now the novice investor usually does not know this, and will at some point get stopped out while the professional trader sets his stop at $99.99 for example and lets the trade ride.
On this given day (circled on the chart) the risk in this trade would be around $1, entry through $100, stop below $100 and now the stock has gained over 14% in less than a month.
Keep an eye on stocks as they approach the $100 level and you can spot some easy trades with great upside potential!
Do you have balls?
Post 3 examples in the Chart Reading chat of stocks that broke above $100 where a stop at $99 would have kept you in for at least a 5:1 trade.
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