Don't want to do it Again

One of the the more important things that I try to do in stock trading is really simple. Don't make the same mistake twice. This simple lesson can really save you a lot of time and energy, the only trick is that you have to learn to apply it.

The lesson that I have had the pleasure of learning the hard way is, don't assume that a huge jump up means that the stock will come back down. I made this mistake a while back ( in the falkin II contest) with a stock that jumped up from a 50 moving average of approximatly $12.00, to $21.00 in one day. My assumption was, "this stock is going to fall, no way this can last." I wish I could give you the ticker symbol, but it escapes me. Anyhow, I didn't do much research, shorted 2000 shares and waited for the fall. It didn't happen though. At least not when I needed it to in the contest, and I ended up loosing about 4 k on that trade. I might have been right in the long run, but since I was more speculating for the short term, rather than investing for the long term, I lost.

The stock that caught my eye today is GP, which jumped well past its 50 day moving average. It is up over 35% percent today. My competive spirit tells me to jump on this, but I have decided to wait and see what happens over the next few days. If it show support, I will stay away, but if I start to see a slow drop, then look for a short from me on this one. I will let you know my results come next Monday. I am hoping for a short, but I would rather not loose on this trade than take a gamble. I already learned this lesson.

Good Luck With Everything!

Mark Zimmer