I have summarized all the posts I liked most here in this list - for the benefit of the new members:
Choose the direction; and buy or sell on a reverse bar. Less risk/more profit.
going short on the the second double top because everyone wants to get on that train.
"The trend is your friend"
Trading is an odds game
Be humble, even after 20 winning trades in a row
Dont trade on hope.Trade with a plan.
Those who never take a risk, will never make it big.
"It's better to travel than to arrive" -i.e buy on rumour, sell on fact
Remember.. Buy on the red, sell on the blue....
Those that feel comfortable in crowded places often get their pockets picked
Have a checklist of conditions that must be fulfilled before you enter a trade, tick every one physically on your trading record sheet. If you can't stay out.
Lower the risk until you find your sleep level.
It pays to wait.
'Every big loss starts as a small stop.'
MOTION BEGETS EMOTION BUT DICIPLINE OFFSETS EMOTION.
automate evrything so trading follows rules and emotion is removed.
Be sure to have a target number of points worked out for your exit.
I've always tended to jump out of winning positions too soon,
setting target exit points helps me handle this emotional response.
Overcome GREED and FEAR - the root cause of losses!!
Plan the trade;Trade the plan
Keep it simple, in my case, 1 screen and charts in my head for the stocks I follow.
Trading successfully imo is about judging human emotion ie. make the first move before the average investor/trader does.Be brave intially.
always have a target in mind.
You'll never go poor taking a profit. Not on any single trade, but within a strategy taking profits too early without good reason is a sure road to ruin.
Its better to be out the markets wishing you were in than in the markets wishing you were out
"Deciding to stand aside is taking a position" Whenever I get impatient, I try to remember this one.
Don't fight the market..... milk it.
Don't fight the market; it's miles bigger than you. Which I guess is much the same as the familiar "The markets can stay irrational longer than you can stay solvent."
There's no shame in backing out. It's what reverse gear is for. Don't go bust trying to prove you are right.
If there's any doubt...then there is no doubt, ie. don't make the trade
I know trading opportunities are limitless so if something doesn't add up on one particular trade, I will let it pass and wait for the next opportunity.
Always use the first bar of the day as support/resistance when entering on the 2nd or 3rd bar.
A losing trade very rarely turns into a profitable one
"When unbridled buying/selling takes place, the chart is useless."
"No target - no trade"
"Always try to trade in the direction of the underlying market.."
Technical Analysis Traders Wheel: trading tactics, tutorials and strategies for day trading and short-term trading using technical analysis.
Take regular small profits and harness the power of compounding.
I've found patience, discipline , timing and a dash of Luck, to be most useful, if only I would take my own advice on this !
Know your entry and exit BEFORE you place a trade!
The way 2 get rich quick is also the same as going broke. lol Its all about risk management and compounding your stake
Always look both ways before crossing the road. (think about that one in it's trading context)
You also need a great sense of humour and be able to laugh at yourself and your worst trading decisions.
Some of the most obvious trades work because they are a self-fulfilling prophecy
Get a great charting package
"A stop is a stop is a stop"
"You gotta be in it to win it"
Once we realize that imperfect understanding is the human condition there is no shame in being wrong, only in failing to correct our mistakes.
Get out of all losing trades the day of entry. Meaning, if you enter a trade and by the close it is a loser from the entry point, get out by the close. Even if it is a long term trade. If you have to get in again, fine. Over the long haul you will be "saved" many times by major breakout fakeouts which you will have gotten out of early.
If you're bored and want to trade..take up gardening..it's cheaper
Of the 12 systems tested from 1975-84, only 4 generated significant profits. Of those, 2 were channel breakout systems, and one was a dual moving average crossover system.
don't worry if you miss an opportunity; just like buses, another will always come along.
When in doubt, stay out.
Understand trend reversals
Take it easy, trade by trade, cent by cent
1) Buy stocks in a long steady upward trend in the hottest sectors.
2) Set tight stops every morning, you can always buy it back if you want it.
3) Set tight stops so you never lose more than 5% on any one trade. Protect capital at all costs.
4) Keep a notebook with all trades, support, resistance, target, stops and rationale, and when you closed the trade, what you learned from it.
5) Whenever you get burned badly, make a rule out of it, or figure out which rule you broke.
6) Always recheck the market in the afternoon 'cause things can turn ugly quick.
7) When the whole market tanks, sell everything and then short immediately, don't wait.
8) Keep it simple.
It has been my experience that how you buy wins the game. " a good entry covers a multitude of sins" ( bad exits)
dont trade on the news as its history to the markets by the time it reaches you.
Don't be afraid of risk - without taking risks there is no reward to be had at all.
1. Trading affects psychology as much as psychology affects trading - This was really the motivating factor behind my writing the new book. Many traders experience stress and frustration because they are trading poorly and lack a true edge in the marketplace. Working on your emotions will be of limited help if you are putting your money at risk and don’t truly have an edge.
2. Emotional disruption is present even among the most successful traders - A trading method that produces 60% winners will experience four consecutive losses 2-3% of the time and as much time in flat performance as in an uptrending P/L curve. Strings of events (including losers) occur more often by chance than traders are prepared for.
3. Winning disrupts the trader’s emotions as much as losing - We are disrupted when we experience events outside our expectation. The method that is 60% accurate will experience four consecutive winners about 13% of the time. Traders are just as susceptible to overconfidence during profitable runs as underconfidence during strings of losers.
4. Size kills - The surest path toward emotional damage is to trade size that is too large for one’s portfolio. We experience P/L in relation to our portfolio value. When we trade too large, we create exaggerated swings of winning and losing, which in turn create exaggerated emotional swings.
5. Training is the path to expertise - Think of every performance field out there - sports, music, chess, acting - and you will find that practice builds skills. Trading, in some ways, is harder than other performance fields because there are no college teams or minor leagues for development. From day one, we’re up against the pros. Without training and practice, we will lack the skills to survive such competition.
6. Successful traders possess rich mental maps - All successful trading boils down to pattern recognition and the development of mental maps that help us translate our perceptions of patterns into concrete trading behaviors. Without such mental maps, traders become lost in complexity.
7. Markets change - Patterns of volatility and trending are always shifting, and they change across multiple time frames. Because of this, no single trading method will be successful across the board for a given market. The successful trader not only masters markets, but masters the changes in those markets.
8. Even the best traders have periods of drawdown - As markets change, the best traders go through a process of relearning. The ones who succeed are the ones who save their money during the good times so that they can financially survive the lean periods.
9. The market you’re in counts as much toward performance as your trading method - Some markets are more volatile and trendy than others; some have more distinct patterns than others. Finding the right fit between trader, trading method, and market is key.
10. Execution and trade management count - A surprising degree of long-term trading success comes from getting good prices on entry and exit. The single best predictor of trading failure is when the average P/L of losing trades exceeds the average P/L of winners.
remember that the market adapts and evolves. Always keep up! A factor that doesnt impact the markets today, doesnt mean it will not impact the market tommorow! Try to get a 'bigger picture'. Also remember that politics plays a big role in the financial markets
there isnt a 'holy grail' method out there that carries no risk. The key is to manage your risk and preserve your capital. Define a strategy that works for you
1) Accept without reservation the reality that "No matter how good a trade looks, it can turn into a loser".
2) Predefine the risk of EVERY trade by establishing a maximum amount that you are willing to lose on it.
3) Honor your predefined risk when it is reached. Do not rationalize, hesitate, justify or hope. Close the trade. There is always another trade just around the corner.
These three steps will help you avoid the common trading error of letting a small loss turn into a big loss.
They will preserve your capital and enable you to return to trade another day.
The patience of waiting for the right entry price is bitter, however the fruit of the perfect exit is sweet.
"There is no holy grail of trading. Somewhere, somehow, a cruel illusion that it can be done perfectly was started. It does an incredible job diverting peoples attention from developing imperfectly profitable systems"
If you set stops too short, keep modifying your stop loss, feel that the market is against you or that you are in a fight with other people, or perhaps want revenge for the losses youve sufered... or you still take impulse sucker trades without any notion of the value of your entry/exit and total possible loss IN ADVANCE let me assure you you will oh yes YOU WILL LOSE!!!!
If you trade the chart and not Cramer or CNBC or the news or tips, and stick to your rules, you will no longer make impulse trades.
Reward to Risk MUST BE 2:1 or better . With a minimum of a 2:1 R:R, you can be right only 35-40% of the time and still make money.
Fixed fractional risk: I never risk more than 1% of my account on a trade.
Trading with the trend , staying away from that "it's gonna go the other way" trade has saved me a lot of money.
http://www.trade2win.com/boards/gen...l-trading-profit-tips-work-27.html#post354385
"A traders job is to identify patterns in the market's behaviour that represent an opportunity ~ and then determine the risk (or cost) of finding out if these patterns will play themselves out as they have done in the past"
so dont trade except on the extremes,channell tops and bottoms,while u are patiently making oodles of cash on the extremes,you will learn freeely thru patience..the shell game being played in front of u ...easily said...practice..its all about discipline...u wouldnt b greedy if u were rich, and u will never b rich if u r greedy..
"There is simply no discretionery trade that ever worked consistently without absolutely rigourous attention to rules"
Only trade in the direction of the longer term trend. that way, even if you miss your shorter term view, you stand a chance as the prevailing i.e. longer term trend will take the trade your way.
