mcp down, does mean today lyc up?, page-98

Project,

ok, I'll bite.


You buy Lynas at 2.40 thinking it will get to $10 very soon based on FA, TA and BS you hear.

Naturally, you don't bother with a stop loss because it is going to the moon.

It starts to head down... if you had set a stop loss at 5% below your buy in price you would be out about 5% (+ commission)...

You can then either reverse, sit out, or buy back in.


Since you did not have a stop loss, you ride this puppy right down till today.


Tell me, who managed to protect themselves from a losing position ?

--------------


Scenareo 2

You buy Lynas @ $2.00 knowing it will hit $10 soon.

you set a stop loss at whatever level you desire (say $1.94)

It goes up to $2.3

You move your stop loss to lock in your profit... say 2.2 or 2.25

now you can ride the puppy all the way up to the top with a trailing stop loss.

--------------


Honestly, I have not been a big user of stop losses in the past because the big boys would often (almost always ?) sweep the floor before moving the SP up/down... however I will, in the future, set a price at which I will sell on the day I buy a share, and stick to it... moving it up if the sp goes up but not moving it down as it comes closer to the share.

That is my big lesson from Lynas.