Disliked{quote} Are you sure? A risk management plan involves: - Limiting your market risk exposure to a tolerable level - Using a position size that reduces risk of ruin - Selecting which markets to play to provide diversification benefits but avoid over-tradingIgnored
- #24
- Aug 27, 2015 12:03am Aug 27, 2015 12:03am
- Joined Oct 2012 | Status: Trade Small, Win Big | 4,988 Posts
If you are good at something, never do it for free--Joker
- #29
- Edited 6:19am Aug 27, 2015 5:46am | Edited 6:19am
- Joined May 2008 | Status: dynamic | 2,412 Posts
with that kind of experience i am pretty sure you already know the answer to your questions, i'm also convinced that if you take the time and really dig into it you will come up with a solid trading plan in a day all by yourself. you know your strength and weaknesses, likes and dislikes, you can have all kinds of issues in different areas of trading, which only you can solve, what aspect of trading you should improve etc. there are a lot of ways to make money and what works for one type of person doesn't for the other.
off the top of my head here are some general guidelines
psychology:
make uncertainty your friend, the more you are trying to get rid of uncertainty and lean towards confirmation, the more you increase your risk and at the same time cut into your profits (kill your RRR), this goes for entry and exit of a trade. if you need confirmation your risk is too high and you will need an insanely high W/L ratio.
you have to take action despite of uncertainty and then judge your "being right" by following the market response.
entry/exit:
as said before, buy low, sell high, buy wholesale, sell retail, buy the down-, sell the uptick, this doesn't mean at all to try to catch the top/bottom it means don't chase price, don't be a sucker. in a trend buy the dips, sell the rallies, in range buy support, sell resistance. Sam Seiden is also a good read as well.
range:
what is a range: price bounces back and forth, making no advances, good range: large swings, bad range: small swings
never trade from the inside to the outside of a range (try to catch a trend early), fade fake breakouts, trade only away from the range when price already broke away substantially and tests from the outside. with experience you can see when price will break through, that means, stay in if you already are from the other boundary, don't enter during the breakout.
trend:
what is a trend: price goes up, stays up and goes further up, strong trend: weak retraces, weak trend: strong retraces (slanted range)
trade weak trends like a range, exit fully on the boundaries, but only enter in trend direction
in strong trends partially exit on strong moves in your direction, add more on retraces.
examples for entries (could be exits as well):
- a strong move goes into a tight range, a test of the countertrend-boundary of that range
- a tight range breaks building another tight range on top of it, test of the lower boundary of that range
example for exits (could be entries as well):
- unusual strong move, large candle, large profit, immediate counter-move
- dying out of the move, lame advances
apply that knowledge to two different timeframes and stack it on top of each other and with experience you can come up with your own favorite types of setups.
just my 2 silver eagles
off the top of my head here are some general guidelines
psychology:
make uncertainty your friend, the more you are trying to get rid of uncertainty and lean towards confirmation, the more you increase your risk and at the same time cut into your profits (kill your RRR), this goes for entry and exit of a trade. if you need confirmation your risk is too high and you will need an insanely high W/L ratio.
you have to take action despite of uncertainty and then judge your "being right" by following the market response.
entry/exit:
as said before, buy low, sell high, buy wholesale, sell retail, buy the down-, sell the uptick, this doesn't mean at all to try to catch the top/bottom it means don't chase price, don't be a sucker. in a trend buy the dips, sell the rallies, in range buy support, sell resistance. Sam Seiden is also a good read as well.
range:
what is a range: price bounces back and forth, making no advances, good range: large swings, bad range: small swings
never trade from the inside to the outside of a range (try to catch a trend early), fade fake breakouts, trade only away from the range when price already broke away substantially and tests from the outside. with experience you can see when price will break through, that means, stay in if you already are from the other boundary, don't enter during the breakout.
trend:
what is a trend: price goes up, stays up and goes further up, strong trend: weak retraces, weak trend: strong retraces (slanted range)
trade weak trends like a range, exit fully on the boundaries, but only enter in trend direction
in strong trends partially exit on strong moves in your direction, add more on retraces.
examples for entries (could be exits as well):
- a strong move goes into a tight range, a test of the countertrend-boundary of that range
- a tight range breaks building another tight range on top of it, test of the lower boundary of that range
example for exits (could be entries as well):
- unusual strong move, large candle, large profit, immediate counter-move
- dying out of the move, lame advances
apply that knowledge to two different timeframes and stack it on top of each other and with experience you can come up with your own favorite types of setups.
just my 2 silver eagles
Invincibility lies in the defence, the possibility of victory in the attack
