Hey hey: what's up my friend, so in today's episode I want to share with you the top 5 beginner's mistake to avoid when trading the stock markets. Okay, so mistake number one: is this right? You want to avoid buying stocks in a downtrend and here's. Why, according to a research right by Larry Conners, he has done extensive testing right in the stock markets and stopped above the 200-day moving average, then to have a positive median return. This means that stock above the 200-day moving average tends to continue moving higher and likewise right when stock is below the 200-day moving average.

The median written is negative. This means stocks below the 200-day moving average tends to continue moving lower. So this is why, right you don't be behind stocks which are in a downtrend, because it's likely to continue heading lower, ok, so very simple technique, then you can Apollo, is to only buy stocks when it's above the 200-day moving average. This ensures certain that you are buying stocks which are in an uptrend mistake, number two right, many new traders.

They love to treat penny stocks right. After all, you know that's where the big money is making right now. The stocks querido explode up. 30.

40. 50 hundred percent within a few hours a few days, but here's the thing about penny stocks right is that the more money there is low liquidity in this type of stocks. This means right that sometimes, when you want to get out of the trade you can't get up at a price you want, because there's no seller and a price point or there's no buyer. That's telling price alright, depending whether you're long or short, and this could you know, cause you great problems right.

If you're, if you can't get out of a stock right, then you want to get out off and I'm a right penny stock. They are easily manipulated because of their low liquidity right. The price. Can you know you can push it up really high right few hundred percent just like that right, because there is a low liquidity in this type of stocks and when you chase alright such a stock.

Guess what this is when the stocks about to make your pullback it's about to make a reversal, and the last thing you want to do is to be buying near and absolute highs. So unless you are sure of what you are doing, don't rate penny stocks, especially when you're new to stop trading right, go with stocks right, which are logic, apply large cap stocks right those stocks, they move slower. You have no more time to make a decisions and you can get out of your trades. I buy and sell it pretty much any time that you want all right.

Number three don't buy legate's right. So let me share with you right. So in my early years of trading right, I realized that in the Singapore market the STI, it seems to be lagging the US stock market and I was thinking. Okay, that's a good thing right.

I should be buying more of the straight times index right because it's lagging to the US markets and really catch up right. There's a huge potential price increase right that I could profit from and guess what I bought the laggard and it stays a leg for the next few years. So when the stock is a laggard, when a sector is in a leg, that's a good reason for it. Usually, okay, I recommend right.

If you want to trade stocks, you wan na trade, like certain countries in this us ETS or whatever focus on buying a stronger ones. Those are the ones that tend to outperform the market from a training standpoint right. If you buy the laggard right like like what I did right in trading, it tends to remain a laggard right for the next few months, the next few years. Okay, so focus on buying strength, not weakness, number four: when you trade stocks, you don't want to take a huge position right into earnings, because the thing about Ernie's is that you have no idea whether the price of the stock will go up or down stock right.

You can go up on bad news. Stock right can go down on good news. How do you explain it? It's all about. You know perspective in the markets right, it's all about people's beliefs and expectations in the market, not just the news right, but any expectations towards the news, and you can predict right how people will react to that piece of news.

So when you have a stopped position, maybe a huge stock position coming into earnings right, you don't want to be holding the stock position into earnings, especially you know it's it's something that no could really rattle the markets up and down right so be aware of it. Right, don't hole a huge position into a nice, even whole position. Fine right trimming down to a very nice comfortable level where you can sleep peacefully peacefully at night, and the fifth and final thing is that as a stock trader, you don't want to be buying during a bear market right. This means, if the market is doing a recession right, you don't wan na be buying stocks.

Why don't you just hold on to cash as I've shared with you earlier right? If the stock is in a downtrend, it tends to continue moving lower over time. Is the same for the general stock markets? If the S & P 500 is in a downtrend and guess what more stocks are, I tend to be in a downtrend, so it's better to hold on to cash or during such period, make sense. So with that said, let's do a quick recap: number one avoid buying stocks in a downtrend number. Two right avoid trading penny stocks right focus on large cap stocks, I'm a tree don't buy legged right done by weak stocks.

I focus on buying strength. Number four. Don't take a huge position into earnings right because you've never know right how the the earning results will will turn out to be or how how the market will react to it, and a fifth and final thing is that don't rate or don't go long stocks during A bear market is much better right to hold on to cash or to treat some other markets altogether, which are you know more favorable to you all right so with that's it. I wish you good luck and good trading.

I will talk to you soon. You.