Before we dive into the best time of day to buy and how to fade stocks in 2022, I filmed a quick, timely video on the biggest report of the week… Tuesday’s Consumer Price Index data.
The “experts” expect inflation of 8.6%… but I see it coming in closer to 10%, the type of number we haven’t seen since 8-track tapes were a thing…
And if we get that 10% number, look out below on Wall Street!
Check out my short video and give us a follow on Instagram!
Now, back to today’s topic…
We’re four months into a choppy and turbulent market that investors expect will get much worse… And I’m concerned for traders who don’t know when or how to fade stocks in 2022.
We’re in a new trading regime that none of us have been able to prepare for, so it’s vital to find a stable strategy that works in any type of market environment.
For me, it’s fading the stock market by going against the current trend…
The best time of day to trade when fading is right before the closing bell.
When learning how to fade stocks in 2022, you have to keep in mind two of the most important times on Wall Street: the opening and closing bells, which are of course 9:30 a.m. EDT and 4 p.m. EDT.
Everything in between the first and last hour of the trading day should be considered amateur hours… It’s the pros and veteran investors that trade the open and close.
So why do I like to fade during the last hour — sometimes the last 30 minutes — of trading?
How to Fade Stocks in 2022: It’s All About the Closing Bell
I love fading the stock market during the closing bell because by the end of the day, you’ll often see climactic buying or selling from banks, hedge funds and other traders.
This happens because they have to put on their entire position before the stock market closes that day, and be done with all of their trading by 4 p.m. EDT.
This phenomenon gives traders an edge to go against them because they are moving the price of certain assets in a short period of time — creating a dislocation in the asset. This will then create a huge opportunity for a reversal.
A reversal — which is key when fading the market — is a change in the direction of the price in a stock, from going up to down and vice-versa.
A characteristic I learned that the best fade trades have is the potential for a huge return in a short period of time — overnight.
And I know a strategy that’s designed to pick up on these end-of-day movements, delivering gains in less than 24 hours…
Get the strategy here.
Watch the video below to learn more about how to fade stocks in 2022.
And as always, send any topics you’d like me to cover to firstname.lastname@example.org and stay ahead of the markets, especially these choppy ones, by subscribing to our YouTube channel.
P.S. If you want to learn even more about fading the stock market, check out my Burn Notice Alerts here.