Psychology of a profitable investor

It is quite a challenge to buy shares of a stock that has a rising price. Those who bid lower than the ask price may discover their order isn't filled as investors willing to pay the ask price drive the share price higher. Occasionally especially with penny stocks, the ask price investors want for their shares is firm at the same time as the bid price other investors want to pay. Those who ask the higher price understand the value of their shares. Bidders are still looking for a good buy, looking for the market to make a correction and drop. A great opportunity for the new investor.  Bidders know the power they have.   Without a bid and ask price that matches there is no market in the stock.  Bidders don't have to spend their money, they can wait, or can they.    Rising stock prices draw new investors who don't want to miss the action, the opportunity to make money.    They will pay the asking price, motivated by the value, the bidders who are working to create an opportunity with lower prices are motivated by greed.   The reverse happens when the value of the stock is realized in the stocks price.   The key to getting to the value is found by those who know what they have and hold firm all the way up. 

A stalemate occurs when both the ask and bid are firm with their prices.   The market watches to see which side has the fortitude to determine the real value of the company. Will those who want to sell continue to hold firm or succumb to the bid. Many times an investor who isn't aware of what is happening will offer their shares at the bid price. Another time an investor will move a few shares at the lower price to create a false picture of what is currently occuring. They believe investors who are firm with their asking price will break when they see the drop in price, giving them another opportunity to buy shares as investors believing the stock is dropping sell at the lower price.

Sales volume of a rising stock that drops in price is a way for those who are firm with the ask price to identify the strategy to convince them otherwise.  

I continue to use APNX as my study because it is a classic example of this occuring. Today the bid was $.12 for most of the day. Asking was $.16 What is important is the volume of the shares that sold at the lower price. Today's volume at the lower price from yesterday of $.14 a share was 2300 shares. Definitely not a volume indicating weakness in the stocks rising price. What we find with this occurs is the spread between the ask and bid price is greater than what we see in rising prices. The bid is now $.06 a share qty 5000. The ask price increased to $.17 a share from the high of $.16. Had it dropped, it would be more indicative of profit taking, the stock has reached its high for the time being. Understanding the role of today's volume encourages the continued rise in price and the asking price climbs in spite of a drop in price today. Remember 2300 shares traded at the lower price does not give us a bear market in APNX. Quite the contrary. When you consider the last 4 quarters for this company, you find quarters very similar. All pofitable. Great news for the investor. Take a look and join the psychology of the winner who is buying now to hold till it reaches the new high and the stocks real value.

I am unable to buy more. and yes i own shares. I will benefit as the stock's price rises. Those who follow my continued review of this stock will see this company shares undervalued. Where it will go is determined by the added interest and desire of other investors to climb on board.

Good luck to all.

Today 3/24 the stalemate continues.  Volume was 0.  Those asking continue to hold firm at $.17, the bid again is at $.06.   New investors are either waiting on the sidelines or haven't discovered the potential of a purchase.   Of the many penny stocks out there, it is rare for one to be well run and profitable in a bad economy with sales of $20 million.   Those who ask who are firm need to realize patience is important.   I bought over a year ago, holding firm with my belief of the value, not selling when the market kept it trading in a low range with minimum quantities.   Volume has picked up as the price has risen.   What we see happen will depend on the psychology being played out between the bid and ask and its real value.