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Today's Quote
Most investors say "Don't take risks." The rich investor takes risks.
~Robert Kiyosaki
Essential Technical Analysis - Table of Contents
Trading and Investing, Strategic Considerations
Technical Analysis - Introduction
The Market Variables: Direction, Momentum, Volatility, Liquidity, Volume
Market Trends, Highs and Lows
Impulsive vs Drifting Price-Action
Volatility Expansion
Support and Resistance
Candlestick Patterns
Summary
Trading and Investing, Strategic Considerations
Trading successfully is by no means a simple matter. It requires time, market knowledge and market understanding and a large amount of self restraint.
Anyone who says you can consistently make money in stock exchange markets is being untruthful. Stock exchange by nature, is a volatile market. Timing a trade correctly is probably the most important variable in trading successfully but invariably there will be times where a traders' timing will be off. Don't expect to generate returns on every trade.
To be successful in the markets over the long-term a trader must have a winning strategy, and apply it consistently.
A winning strategy:
Must be clearly defined : The simpler the better. Remember, you can't forecast the market's
next move, and neither can anyone else. Simple trading rules make for clear-cut and effective
decisions (while most other participants are still trying to compute and weigh the implications
of dozens of factors and indicators - and generally wallowing in a state of catatonic confusion, particularly if the market is not going their way - you will have acted, and will be calmly observing and waiting for a new signal).
Must include : definition of the conditions which will trigger the opening and closing of positions (both to take profits and to cut losses) and rules governing the size of position to be taken.
That much seems obvious, but a very large proportion of traders and investors fail to make these definitions. They buy things they think (or are advised) are likely to go up; watch them start to go down; then think "what shall I do now ?". This is not the way!