Buy The Rumor, Sell The News-Not The Best Advice

“Buy the rumor, sell the news”  is used in stock trading a lot.  It means get in the market when there is talk about the market moving in a certain direction then before the news comes out get out of your trade.

This is not good advice when trading the markets.  Always check the trend and use the signals the indicators are giving to enter the market.

RULE: Check the long term trends, only trade in the direction of the long term trend.  For example, if the 4 hour is going in a direction then only enter trades on the 30 min when the signals point in the direction of the larger time frame.  If the 1 hour chart is your trend chart then trade the 15 minute in the direction of the 1 hour trend.  When day trading consider the 15 minute chart as the trend chart and enter a trade on the signals from the 5 minute chart.

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