Some rules, i read at a German book about trading.
I'm not entirely agree with all the points, but most have of course still valid and the text reads well:
1. Forget the news, remember the chart. You're not smart enough to know how the news will affect the prices. The chart already knows that the messages arrive.
2. Buy the first withdrawal from the new high. Sell at the first retreat to a new low. There are always people who missed the movement for the first time.
3. Buy at support, sell at resistance. Everyone sees the same thing and everyone is waiting to jump.
4. Short rallies, small sell-offs. If the market falls short sellers make profit and are ready to stock up.
5. Never in buying or selling in a large "moving average". See; 3.
6. Never run after the momentum, if you can not find the exit. Assume that the market will turn once you're in. If the output is far away, it looks bad for you.
7. Exhaustion gaps are closed. Breakaway and continuation gaps do not. That with the wisdom of experienced traders is a lie. Trade in the direction of gap support whenever possible.
8. Trends test the resistance / support points. Walks here, even if it hurts.
9. Go with the TICK and not against it. Do not be a hero. Go with the flow of money.
10. If you have to see it's not there. Forget your diploma and trust your instincts.
11. Sell the 2nd high, buy the 2nd low. After sharp setbacks any new / first test of highs or lows runs into resistance. Expect the break in the third or fourth attempt.
12. In the last hour, the trend is your friend. If clock at 15:00 (EST) goes up the volume, do not expect anyone "switch".
13. Avoid the opening. The idiots come to see you.
14. 1-2-3 rebound. Search bearishness to go after a top, two lower highs and a double bottom in the opposite direction.
15. Bulls live above the 200-day line, including bears. Seller kill rallies under this brand and buyer are available as savior on this line.
16. Prices have a memory. What happened to the price for the last time at a certain level? Chances are this good, that exactly the same thing happened again.
17. Large volume kills the movement. Buyers and sellers withdraw to extreme movements in the market, which makes for a subsequent lateral movement.
18. Trends do not change immediately. Counter-movements build up slowly. The first strong downward movement always find buyers, and the first strong upward movement always seller.
19. downward movements tend to last longer than upward movements. Greed takes faster than fear, which shares from its own weight can be pulled down.
20. Get in and out in front of the crowd. You have to take their money before your points.
Hope the translation is understandable.
Wish you all good trades and a nice Christmas time.
Cheers
Akvisto
I'm not entirely agree with all the points, but most have of course still valid and the text reads well:
1. Forget the news, remember the chart. You're not smart enough to know how the news will affect the prices. The chart already knows that the messages arrive.
2. Buy the first withdrawal from the new high. Sell at the first retreat to a new low. There are always people who missed the movement for the first time.
3. Buy at support, sell at resistance. Everyone sees the same thing and everyone is waiting to jump.
4. Short rallies, small sell-offs. If the market falls short sellers make profit and are ready to stock up.
5. Never in buying or selling in a large "moving average". See; 3.
6. Never run after the momentum, if you can not find the exit. Assume that the market will turn once you're in. If the output is far away, it looks bad for you.
7. Exhaustion gaps are closed. Breakaway and continuation gaps do not. That with the wisdom of experienced traders is a lie. Trade in the direction of gap support whenever possible.
8. Trends test the resistance / support points. Walks here, even if it hurts.
9. Go with the TICK and not against it. Do not be a hero. Go with the flow of money.
10. If you have to see it's not there. Forget your diploma and trust your instincts.
11. Sell the 2nd high, buy the 2nd low. After sharp setbacks any new / first test of highs or lows runs into resistance. Expect the break in the third or fourth attempt.
12. In the last hour, the trend is your friend. If clock at 15:00 (EST) goes up the volume, do not expect anyone "switch".
13. Avoid the opening. The idiots come to see you.
14. 1-2-3 rebound. Search bearishness to go after a top, two lower highs and a double bottom in the opposite direction.
15. Bulls live above the 200-day line, including bears. Seller kill rallies under this brand and buyer are available as savior on this line.
16. Prices have a memory. What happened to the price for the last time at a certain level? Chances are this good, that exactly the same thing happened again.
17. Large volume kills the movement. Buyers and sellers withdraw to extreme movements in the market, which makes for a subsequent lateral movement.
18. Trends do not change immediately. Counter-movements build up slowly. The first strong downward movement always find buyers, and the first strong upward movement always seller.
19. downward movements tend to last longer than upward movements. Greed takes faster than fear, which shares from its own weight can be pulled down.
20. Get in and out in front of the crowd. You have to take their money before your points.
Hope the translation is understandable.
Wish you all good trades and a nice Christmas time.
Cheers
Akvisto
