This current market has driven many to day trade out of fear to commit for longer terms given the GFC. I have had an amazing run this year, but that immediately makes me think to be cautious in the near future, because all good things do come to an end normally very suddenly. I suspect the impact of the next down turn will be similiar to driving over a cliff for many day traders. This market is making many very inexperienced traders, think they have sudddenly become experts, when in fact we have a great tail wind behind us at present. Some stocks I would not trade ever given their history. I believe it helps a lot to do some research on a stock & identify whether it represents good value & what could be the key drivers in the short term. Last week I identified PRR at 3.4 cents as good value on the back of what was happening to a similiar biotech in the States, but elected not to take a position due to my gut feel on the market. Yes, I would have traded PRR successfully, unlike the poor traders who have bought too high & can only hope for some surprise in the announcement from the US on 28/4/2009 to give PRR a second leg. Today after researching TOE, I was happy to take a position for a short term trade. I have identified a number of short term facts that should drive this stock higher in the short term, but I also have to watch very carefully when to exit with a profit. Good researching hopefully gets you set before others discover a situation, arriving late is a recipe for disaster. Most of the really good traders/investors on HC have original ideas rather than being followers. The followers always struggle to exit at the right price. Anyway, TOE may be worth a bit of overnight research for the keen student, but remember be very careful with this market & don't get greedy. Regards Buffett PS It also helps to have the knowledge to pass on some situations.
