Meta Stock Swing Trade

Hello you very wonderful, kind and intelligent people. I sincerely hope you have had a good start to the week.

I was kindly wondered about a trading technique, i reviewed Meta on the Nasdaq and the last few days it has had more volume above its latest 20 day average volume. Over the last few days, this would have been a good swing trade for the last few days. I know there is lots of other indicators used for trading like Moving Average Oscillator. I kindly wondered please if this alone would be a good strategy for doing a small amount of swing trading please? I have practised this in a demo account with a few other stocks and it works well i really want to try a strategy that is not over complicated. If anyone kindly had any views on this i would be forever grateful and thankful for your time.

Sending you every best wish for a happy future and i hope you achieve massive success with your trading. Enjoy the rest of your day and take care.

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Hello you wonderful and amazing people. I do hope you are doing well. I am very sorry to follow-up, i kindly wondered if anyone had any thoughts on my above post please? Even if it is just a few sentences it would be more appreciated than you may know. Wishing you a wonderful day and all the very best to you.

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Always try to help where I can and I think I’ve answered questions from you before but in this question, I don’t even understand the contents of what you’re asking, never mind being able to attempt an answer. It may be that what you’re asking is so advanced or so obscure that people simply don’t know, although obviously I can’t speak for others.

I know this answer is in no way useful to you but just so you know you’re not being ignored!

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Thank you very much for getting back to me 1anrs that is very kind of you. I am very sorry that you did not understand the question, but i appreciate very much your reply.

I think i maybe overcomplicated the matter, i am very sorry about that. In summary, Meta stock has shown a sudden increase in volumes above the 20 day average. Can trading just using an increase in volumes to catch a spike in the share price, be a good trading strategy please? The volume of trade refers to the total number of shares or contracts exchanged between buyers and sellers of a security during trading hours on a given day. If you kindly had any thoughts on this i would be very thankful, hope you can please understand this.

Thank you very much for your time 1anrs and i do hope you enjoy the rest of your night. All the very best.

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[quote=“robertbanking, post:4, topic:62279”]
Can trading just using an increase in volumes to catch a spike in the share price, be a good trading strategy? [/quote]
Thank you, ok I will attempt to answer this although I think there would be people far better qualified than I.

I don’t think any one criteria should be used in isolation to establish a strategy. This also sounds to me like a strategy designed to be short-term rather than a long-term hold that I suspect most people here would follow. Anyone following a long-term hold strategy would have thought about it a lot beforehand and planned exactly what to do and therefore wouldn’t be influenced by swings in share price either up or down when deciding what stocks to hold long-term.

Also, the risk with this strategy it strikes me is that you end up buying at the top of the curve and having a paper loss when it dips. Take Centamin (CEY) as an example. It’s usual price is about £1 to £1.10 and last year it spent some weeks going upwards towards £1.25. If I’d never bought any previously and using the strategy you ask about, I would have bought it as it was going up only to watch it lose value as it went down to its usual price. It’s currently £1. I would have been sitting on a 25% loss.

I think what you need to do is to sit down and decide what stocks and other things like Trusts and ETFs you want in your portfolio using various criteria and holding for the long-term. Don’t even consider share price up and downs unless they become too expensive or massive discounts, that shouldn’t matter if you are confident about the stock itself.

I know this is a bit more than you’re asking but hopefully useful, criteria could include:

  1. Market Cap (a co of £1M might still have huge growth potential, £1B is harder)
  2. Margins
  3. Returns (on Assets & Equity)
  4. Dividend Yield (if like me you like to invest primarily in dividends - also then look at whether they have suspended or reduced their dividends in the last 10 years)
  5. Current Ratio (this depends on the type of business but measures assets over liabilities)
  6. PE Ratio (again depends on industry and business but generally, a ratio in high single figures will indicate a more realistic and promising growth potential than the likes of Amazon or Tesla that might have them in the 100s).
  7. Debt to Assets (very important, again depends on industry as insurance companies always have a high number, but you don’t want more than 50% in most cases).
  8. Broker views and insider ownership - can be useful to see what brokers think of the stock, although you need to do your own research as well. Also, check that directors and top executive actually have and buy shares in their own company, that way you can establish whether it really matters to them or not how the company performs, you can get that info on Performance Tables | This is Money)

If you’re looking at Meta, Tesla etc then the normal balance sheet numbers don’t seem to apply, and the chart behaviour is all over the place, it depends as much on whether Elon or Mark smiles or not.

At the least, you should learn about how to read trends and reversals, and resistance and support levels. , Look at different time periods. There is often a different trend at a longer view.

Peer group analysis can also be a good one - especially as you say the valuation of some companies bare little resemblance to their balance sheet. Some stocks are pricing higher imo due to popularity.