In this week’s State of the Market rerun, Chief Income Strategist Marc Lichtenfeld looks back on the worst trade of his career and the lesson it taught him…
That is, don’t let your emotions dictate your trading.
It seems simple enough, but resisting investor emotions is far easier said than done.
Not even Marc could keep his head straight without a new secret weapon…
His worst trade scarred him so much that he set out to discover a strategy that would send clear signals of when to enter and exit trades.
The dream strategy he found is called technical analysis, or the study of stock charts – visual representations of investor fear and greed.
Easy-to-understand technical indicators – like support, the price level at which a stock’s downtrend reverses – would have shown Marc that investor sentiment for his foundering stock had fundamentally changed.
Any investor can come to understand the basics of technical analysis, read powerful indicators and visually track shifts in investor psychology.
Check out Marc’s tips so you don’t have to learn his lesson the hard way.