Christopher Diodato – TradersBase.com
I’ve heard this story all too many times.
- Company event drives stock down 20% or more
- Everyone screams “buying opportunity”
- Stock bounces slightly
- Without needed “smart money” demand, stock crashes.
I think I can sum this up in four symbols. NFLX, GMCR JCP, ANF. Plenty more if you feel it necessary to look for them. The best part about studying market psychology is that while humans make technological progress all the time, they never make psychological progress. We are still social and emotional beasts driven by fear and greed. Take a look at the video below to see why JPM has an 80% chance of making new lows within the coming months. In addition, I provide an extremely low risk trade to take advantage of the decline.
Make sure to view in full screen and HD!