THE PERILS OF MOMENTUM DARLINGS $CREE $NFLX $TSLA $SCTY $GRPN $Z $PBPB $NDLS $VEEV
In my 30 years in the markets, I have seen many investors who make tons of money trading pure momentum only to lose more than they made in the first place. The irony is that many such investors repeat this cycle again and again.
The reason many investors go through this cycle is that they believe the next time will be different; they won’t lose their gains. Unfortunately, for all but the most skilled traders, pure momentum trading is a slippery slope.
Let me illustrate the point with the action Tuesday in two momentum darlings, Cree CREE and Netflix NFLX.
Take a look at a Cree daily chart.… Please click here or the title below to read more.