How to profit from stock prices that go up suddenly

Every stock trader has vivid dreams about their stocks exploding higher.

You have to.

I think it’s a rule!

Are you dreaming of it?

Or do you have a plan to take advantage of sudden price spikes?

Successful stock traders have strategic plans to take advantage of sudden upward price spikes. It is not an exact science. It is simply a method of placing the correct type of order to sell.

The “Trailing Stop-on Quote” sell order is unique in that it allows you to “ride” suddenly rising stock prices and the sell order is executed when the price stops rising and pulls back lower.

Let’s say you own shares in a highly volatile penny stock company.

You have bought the stock because volatility can lead to massive gains very quickly.

He bought his shares of the penny stock company at five cents each, so his $500 investment netted him 10,000 shares.

As he checks his inventory every day, he notices the press release announcing a technological breakthrough for this small start-up.

Anticipating a rise in prices as the news spreads, you place a trailing stop quote sell order that will sell 5,000 of your shares each time the stock price falls 10%.

What this means is that as long as the stock price continues to rise, there will be no selling.

When it stops rising and falls 10%, a market sell order is executed and 50% of your position is sold near the top of the price’s bullish peak.

By selling only 50% of your position, you are allowing the possibility that the stock price will remain at the higher level and perhaps continue to rise in price.

You are straddling the fence.

If the price increase is temporary, you will benefit from selling 50% of your shares at the high price and have cash available to buy them back when the price drops again.

Then you could buy back more shares than you sold, or you could buy back the same 5,000 shares you sold and make some profit.

This is a common strategy to take advantage of the volatility provided by high-risk, high-reward penny stocks.

I’m not a “penny stock player,” however, I don’t ignore promising startups simply because their share price is less than a dollar.

Here is a link to a story that will go deeper into this trading strategy.

http://newdaywealthprotection.com/how-to-take-your-profits-from-suddenly-rising-stock-prices-p282-147.htm