Archive for the ‘Uncategorized’ Category

PostHeaderIcon The Five Dangers of Over Trading

 

 

Over trading is when a trader takes a trade based on fear, greed, desperation, or ego instead of a valid entry signal. Over trading is due mostly to wanting to be profitable so bad that impulses are driving decisions instead of a trading plan. If a trader has an edge over the markets then they want to take the trades presented to them, the more signals the better. If a trader takes trades that are not based on robust entry parameters the more trades they take the quicker their undoing and demise.

The Five Dangers of Over Trading

  1. For smaller accounts over trading can rack up large commission costs that can eat into profitability.

  2. The bid/ask spread is an expense that pays the market makers at your expense. The more you trade the more you pay.

  3. The more you trade the more you can be front run and gamed by High Frequency Traders. You can beat High Frequency Traders with Low Frequency Trading.

  4. Trading too much gets you into bad entries when you should have been waiting for good entries. Entries have to be based on signals and risk/reward ratios not the emotional chasing of gains.

  5. Over trading is bad trading. Generally over trading is the external results of bad internal self controls. It is the epitome of not having a trading plan, lacking discipline, and not following a trading plan. Over trading will cause you to lose faith in yourself as a trader with the discipline to follow a plan. Over trading can lead to mental ruin only take the right trades that meet your own guidelines and trading plan based on homework and research.

 

PostHeaderIcon A Trader’s Stop List To Get to Profitability


A big part of trading is to stop doing the wrong things. Even if you do the right things and don’t stop doing the wrongs things you will not be profitable in the long term. Doing the right things as a trader can make you money but doing the wrong things can lose you even more money. Here is a stop list for those traders that want to be profitable.

A Trader’s Stop List To Get to Profitability

  1. Stop trading so big that your emotions over ride your original trading plan.

  2. Stop hoping a losing trade comes back and just get out when you are proven wrong.

  3. Stop asking others for trade opinions and start developing your own methodology.

  4. Stop trading until you have done the homework to ensure you have an edge.

  5. Stop fighting trends in your time frame.

  6. Stop entering trades based on hope and exiting trades based on fear.

  7. Stop confusing yourself with so many methods and start choosing one that fits your personality.

  8. Stop trading markets you do not fully understand.

  9. Stop following gurus and start following the price action.

  10. Stop trying to predict the future and start trading the present moment chart.

 

PostHeaderIcon 10 Things Stubborn Bears Say In Bull Markets


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Instead of profiting from one of the greatest bull markets of all time perma-bears waste this opportunity with these excuses:

10 Things Stubborn Bears Say In Bull Market

  1. It just can’t go any higher.

  2. “It is due for a pullback.”

  3. “All time highs? That’s bearish.”

  4. “I am loaded with puts.”

  5. “I will wait for a pullback to cover my short positions.”

  6. “The market has to crash the fundamentals are terrible.

  7. “This market looks just like the 1929 chart.”

  8. “This is just a bubble and will end badly.”

  9. “This up trend is just becasue the FED is pumping money into the system.”

  10. “Damn algos.”


PostHeaderIcon 15 Things That Cost Traders a Lot of Money


Ten Things That Are Expensive For Traders.

  1. Egos.

  2. Emotions.

  3. Not respecting the mathematical risk of ruin.

  4. Gurus.

  5. Television.

  6. Trading without a methodology.

  7. Trading with no trading plan.

  8. Stubbornness.

  9. Trading without a stop loss.

  10. Trend fighting in your time frame.

  11. Over trading.

  12. Taking bad entry set ups.

  13. Copying someones trades with no knowledge of their position sizing or time frame.

  14. Not knowing how to take profits in a winning trade while they are there.

  15. Not doing the proper homework before trading.


PostHeaderIcon Ten Fast Facts About The $SPY Chart 9/14/2014


  1. The last four trading days has been in a $200.55 resistance and $198.56 support range hardly a down trend of bearish.

  2. The long term up trend is still intact and price is still within striking distance of all time highs.

  3. The 21 day ema has acted as end of day support since that line was broken above 22 trading days ago.

  4. Price is still over the 50 RSI which is bullish. From the end of April through the end of July the 50 RSI acted as end of day support.

  5. Since August 20th $198 has held as support intra-day. Since August 21st $199 has held as end of day support.

  6. The 50 day sma is the next line of support and if we go their is a very high probability bounce zone. The buy the dip crowd is likely lined up there.

  7. The 21 day ema and 50 day sma are both still up sloping trend lines.

  8. I am still long this market using $SPY and $TNA with tight end of day stops. A close below the 21 day ema is my $SPY stop and a close below the $IWM 50 day sma is my $TNA stop. I have on my full position size here.

  9. Naturally uncomfortable trades are usually the best trades, because you are positioning yourself ahead of the crowd not behind it. The bearishness I hear all around me on social media makes me glad becasue that means that most went home flat Friday or they are already out. So the odds are in favor of them having to get back in next week. We’ll see.

  10. The market is right at the crossroads. For the short term uptrend to stay intact the key support convergences of $199, the 50 RSI, and they 21 day ema need to hold up or at least recover by the end of the day if lost or we will have a sign of some trouble in the short term time frame.

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