Always trade the news
Ever heard of the wisdom: buy the rumors trade the news?
The reason is simple. Rumors generate hype and momentum for the stock, even if nothing fundamental is happening in the company.
However, once there is confirmation of the news, be it earnings or official announcements, the price will always drop.
Take a look at the Joe Biden's infrastructure plan which made $Tesla(TSLA.US$ hit its first trillion dollar milestone. Ever since then, $Tesla(TSLA.US$ has been falling, even hitting the lows of $500s in mid 2021.
The reason is simple. Rumors generate hype and momentum for the stock, even if nothing fundamental is happening in the company.
However, once there is confirmation of the news, be it earnings or official announcements, the price will always drop.
Take a look at the Joe Biden's infrastructure plan which made $Tesla(TSLA.US$ hit its first trillion dollar milestone. Ever since then, $Tesla(TSLA.US$ has been falling, even hitting the lows of $500s in mid 2021.
Ride on the hype and sell the news if you are into day trading.
However, in the long run, $Tesla(TSLA.US$ went back to its trillion dollar status and still remain as the strongest EV company threatening to topple legacy car giants. It is too little too late for legacy auto to catch up now, with Tesla securing most of the critical EV components, the lithium batteries.
As usual, DCA is the best strategy in the long run.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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Tesla is a good exzample