Trading Tips
Found these great trading tips from Joe Ross at ActionForex. There’s a lot of them so I’ll post some now and more later.
THE TRADE DECISION
1. Never add to a losing position.
2. Always determine a stop and a profit objective before entering a trade. Place stops based on market information, not your account balance. If a “proper” stop is too expensive, don’t do the trade.
3. Remember the “power of a position.” Never make a market judgment when you have a position.
4. Your decision to exit a trade means you perceive changing circumstances. Don’t suddenly think you can pick a price, exit at the market.
THE MARKET HAS CHARACTER
5. In a Bull market, never sell a dull market, in Bear market, never buy a dull market.
6. There are times, because of lack of liquidity, or excessive volatility, when you should not trade.
7. Trading systems that work in an up market may not work in a down market.
8. There are at least three types of markets: up trending, range bound, and down. Have different trading strategies for each.
9. Up market and down market patterns are ALWAYS present, merely one is more dominant. In an up market, for example, it is very easy to take sell signal after sell signal, only to be stopped out time and again. Select trades with the trend.
10. A buy signal that fails is a sell signal. A sell signal that fails is a buy signal.
11. It’s always easier to enter a losing trade.
12. In the “blowout” stage of the market, up or down, risk managers are issuing margin call position liquidation orders. They don’t check the screen for overbought or oversold, they just keep issuing liquidation orders. Don’t stand in front of a runaway freight train.
13. You are superstitious; don’t trade if something bothers you.