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About trading

December 7, 2011 Leave a comment

I see Salad is on fire, he is relentless. with posts and trades.

I dont have time to post charts today.

I closed my gold position from 1741 at 1748 ( I was staying on a loss for a few days) .

I entered gold again close to 50DMA, at 1712…. Miners about the same time.

I guess Salad covered the direction with charts and meaning.

 

I dont like how USD behaves but the SPY looks like it is close to go over the 200 DMA, so we will know shortly if the next few days are rewarding for the patient trader.

 

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I want just to say a few rules I imposed on myself about trading:

— discipline. This needs to touch or involve at least the following:

Entries: are you patient enough to get your entry point? It does not matter how do you decide, what system you follow, bu this is a must. OOOhh this covers the first principle: buy low and sell high. BUY LOW AND SELL HIGH.  Is this easy? Think about it? Is your mind trained to do this? If not, then what you gonna do about it?

Exists: you need to sell high: Where is high?  A good principle is to follow the Salad principle:  Sell when they cheer.  Think if you can do that.

Both principles above go hand in hand with this:

As a trader you need to be able to let the train go, this goes well with discipline and risk management.  What train you may ask? If you need to know the answer, then what can I tell you 🙂

Now the real part starts:

Risk management: If entries and exists are hard, let me tell you this is the hard stuff.  Most of the experienced traders will say they are able to come out unscratched even if the entry was really bad. Why? Because they understand risk management.

What risk management involves?

position management. Depending on your capital and greed level, this may save you or break you. Do you know how to do this?

— are you able to let it go? meaning, you have a bad entry, the price comes to your level, close but not quite there, are you able to get out with just a small loss when you feel you are on the bad side?

stops, do you use them? on the long side you have the Fed on your back, on the sell side you have time speed. Think hard about this? Can you use a time stop? Do you have a stop to get out? How is this based? On levels, trendlines or what? This is important, because it is the barrier between you and everybody else who wants your money on the market. How do you calculate the stop level?

cool head: Do you have patience and can you be cold enough to follow your system and rules?

— does it look easy or hard when you enter a position?

Trader type definition

How do you define yourself as a trader? Can you?

  • Some of the traders on the Internet blogs are cowboy traders, they shoot from the hip and wait to see the results.
  • day traders with different expertise.
  • system traders, I am 75% here
  • swing traders: I am 25% here too. Not more than that because I fell at this stage I am going mostly on the long side. So not a real swing for me.
  • pattern traders. This works more than you know. But it needs a special system to find patterns and a lot of study.

Bull or short? Can you do both? Really?

Day or middle/long term trader? Why? How is your personality copping with this?

Good luck…

 

 

 

 

 

 

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Categories: Miss Market