RE: The Question When you trade a stock you should be prepared for any outcome & have plan to deal with it. Trading is all about probabilities. You have to constantly assess and reposition to the changing circumstances. Fundamentals, sector, technical indicators & overall market conditions are all important.
You can afford to be wrong a few times & should be able to manage your exposure & get out of a bad situation at break even or a reduced loss by having all options open to you this is only possible when you hold huge amount of cash & do not take excessive position in one stock. If you see a stock going down sell it & buy it cheaper even if you are selling it at a loss. You cannot do this in investment account. By doing this you are reducing your losses & repositioning & managing your exposure by not increasing your position & getting some cash out. The risk with this approach is that you sell & then you wait too long to buy in & the stock price moves above your sale price. If you do this the same day the this risk is reduced. For risk management you should know how to trade a range bound & declining trend stock. If you think that the stock may be bottoming out on a big decline then you can increase the position & start shedding at it bounces. If there are pull back then you reposition. Under normal trading condition I use RSI to increase / decrease enter or close positions. If you can identify the trading pattern of a stock then your results would improve. For a strong upward trend stock it is better to buy & hold.
I consider PDN as range bound to a declining stock. The bad thing about this stock is that the trend is set by Aus. Which I do not like. If you put stop losses you can have very unpredictable results as the stock gaps down when it come under pressure in Aus. I never put stop losses. I am not saying that it is a bad idea in general for other stocks. It is not my style because I do not want to lose control of the trade. You have to develop a style that works for you. Everyone is different. Any approach is good where you have more profitable trades & few losing trades. No one can be right every single time. So do not buy a full position ever.
Technically you have a trade at double bottom. Put the CCO chart on PDN it is doing the same thing. At double bottom area PDN has historical support for about 10 years & technical indicators such as RSI & stochastic recommend a trade. On fundamental basic the stock offers good value in this area which offers a very good risk to reward ratio. . I will trade this stock in the area & if it keeps dropping I am ready to trade it as an declining trend stock & as the share price gets better then I would increase the quantity of shares that I will trade. At certain price I would accumulate & and wait for UUU payout trade. With reduced price the down side is further reduced. The problem with UUU payout trade is that we do not have a date it could a month or two. For me two months is bit long period for a trade.
Overall market can have an impact on shares too. You cannot ignore summer doldrums.
When you trade do not be greedy. Take what market gives you. I trade for small spreads all the time. My cost is $7+7= $14 flat even a spread of cent is profit for me. Over a year that $7 flat trade can become a very big amount if you are an active trader.
To be a good trader you should have capital & tools & should be able to perform fundamental & tech analysis & figure out the trading pattern. If you can read the tape & constantly track the market book then you can do small spread trading which is low risk trading.