Since I only post winners, let me state that I lose lots of times too.
I have made a list of ways to help avoid losing money on trade based on how I lost money in the past. Breaking any of these personal rules increases the chance of loss for me:
1) No SPACs without a history of success like Robinhood, Palantir or Sofi.
2) Stocks priced under $1
3) Trading before market open for at least 90 mins (break this one often, wind up buying the top)
4) Trading above Volume Weighed Average Price (VWAP), its what algos and market makers benchmark as fair value for the day. Most stocks revert to VWAP. Wait for that to buy or sell if you buy below. VWAP will go up or down too.
5) No foreign stocks.
6) Broke company with no cash on hand, losing large amounts of money per quarter, little to no revenues or inflated revenues. Lots of debt. Chance of bankruptcy or dilution.
7) Going up on no news out yet (possible pump and dump or social media nonsense)
8) Trading up on new patent news. New patent does not currently affect bottom line and could take years to monetize if ever. Stock will likely go back down quickly.
9) Phase 1, Phase 2 for biotechs. Preclinical means nothing. Medical patent is currently worth zero. Biotechs are cash hungry monsters and rely on dilution to survive.
10) Any history of reverse splits, especially multiple reverse. Very, very bad sign.
Also going all in is risky, increases the chance of booking a loss quickly as fear emotion is high. Bet reasonably on many horses.
