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The AAPL’s iPAD is a learning experience!

March 31, 2010

Someone who already knows how successful I am,  asked me to give him an example how I use psychology in the stock market. We turned on the computer, went to AAPL and there it was – a perfect one minute analysis:

Rule 1:New Product: AAPL shares are surging in anticipation of the up coming of the iPAD on April 3, 2010. If you did your homework and bought a 1000 shares a few weeks ago you would be sitting on an extra $30,000.00 nest egg.

Rule 2: A New product by a winner:  AAPL shares are surging like crazy in anticipation of the up coming iPAD on April 3, 2010, announced by the “Tiger” himself. A $40,000.00 is not a dream anymore.

Rule 3: A New product by a winner with a bonus: AAPL shares are surging like never before in anticipation of the up coming iPAD on April 3, 2010 with a “Chip” made by Apple itself for the first time! (watch it Intel investors).

Rule 4: A New product by a winner with a bonus may create a “bubble.”: AAPL shares are surging like never before in anticipation of the up coming iPAD on April 3, 2010. The use of a chip made by Apple itself for the first time may create exuberance (psychological). When the ratio of Median PE/Mean PE<1.00 a ‘bubble trouble is forming with unchecked exuberance.”

Rule 5: Unchecked exuberance or “Bubble” trouble means take profits: You see, most investors behave like a herd of sheep. They buy shares when the market is ‘hot’ and sell when the market ‘cools’ off! Yes, that is what people do! Be like the professionals. Don’t buy or sell AAPL until you learn to do it right. Investing is not like saying to your wife, “Listen, honey, I got a great system.” Investing is not an “ego” trip. Investing is a lot more like, “Look sweetheart at our capital gains record in the last 5 years.”

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