Tuesday, December 02, 2008
High probability set ups
So if you're trading this momentum style, watch the overall markets and get in sync with the trend. Make sure you can see what the trend is actually doing and not just what you hope it will do. Then take the trade that has a higher probability of happening. Keep focused. Think through the various scenarios that can happen so that you will be prepared to move any direction. Acknowledge that unknown forces can affect the market at anytime so have an exit plan before you enter the trade. Relax. Take the money that the market offers up to you when it says to do so. Build up your cash reserves and confidence. Think of your dollars as your soldiers. Don't commit them to a haphazard battle plan that you can't handle if you're pressurized. Reserve them for the battle that you have an advantage in. Turn off that CNBC, there's nothing of value on it. You don't need news, opinions or indicators to trade this style. Just believe the charts.
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5 comments:
This is just awesome stuff. Thank you for posting these many charts and especially the very helpful commentary recently. You have shown me the light!
Again, I thank you for your help,insight, and information! : )
Thanks fellas. I think the fact that I do it in real time and that you don't know is going to happpen next makes the signals much easier to see. Since most bloogers post a complete daily chart, it makes it easy to say "look the trend is so evident" after it happens. I hope that the readers of my blog are getting it drilled into their heads that you don't need to know what will happen next, only trade the probability and keep it simple.
Scott...if you don't mind me asking...what are your reasonings for using EMA 7 & 17?
Danny,
When I first started in this business I read Robert Deels book " The Strategic Electronic day trader" He recommended using the 7 and 17 EMA on 5 minutes chart to help keep you in the trend. I don't use them hardly ever these days and will probably remove them. Occasionally though they do provide a reference point regarding trend strength.
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