Learn How To Trade The News & Make Money
Penny stock traders have many trading techniques at their disposal. One of the best & most used trading techniques is as old as the stock market itself and is commonly refereed to as “trading the news”.
This article will explore how to “trade the news” & you will learn the basics of “news trading” and how you can start using it today to for major gains.
What is trading the news?
Trading the news can be summed up in a single wall street soundbite. “Buy the rumor, sell the news”. Trading the news refers to the common practice of buying a stock weeks before news is expected to be released, and selling the stock right after news is delayed.
This stock trading technique works because stock companies tend to release important news in distinguishable patterns after certain time periods which can be seen by carefully performing due diligence.
How to trade the news?
By looking for patterns it’s possible to make an educated guess on when a company might release more news, and buy weeks if not months before an expected positive news release.
Stocks have the tendency to “run-up” right before positive news is expected and it’s possible to profit from this increase in price by buying stock weeks in advance and selling right before the estimated price increase.
Does trading the news always work?
Like all stock trading techniques “trading the news” doesn’t always produce gains. It’s very important to hone your due diligence performing abilities & master trading this technique on paper before trading real money.
Still with that said trading the news, does work pretty well as far as stock trading techniques go and is almost as easy to master as “trading the gap”.
Closing Words
Trading the news is a very profitable way to make money trading penny stocks. By buying weeks in advance, performing proper due diligence, and selling on expected good new, you can lock in some great gains and lower your risk considerably.
Note: Sell on the expected good news BEFORE the news is actually released.
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