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Technicaltrader

Top 5 Risk Management RulesTop 5 Risk Management Rules: 1. Only Trade with Risk Capital -Risk Capital is the amount of money you are willing to lose and do not include your living capital into your trading account! 2. 2% Risk Management -The 2% Rule prohibits you from risking more than 2% of your account equity on each trade you are entering. 3. 6% Risk Management -The 6% Rule prohibits you from opening any new trades when your current open risks in your open trades reach 6% of your account equity. 4. 10% Risk Management -The 10% Rule prohibits you from opening any new trades for the rest of the month when the sum of your losses for the current month and the risks in open trades reach 10% of your account equity. 5. Risk to Reward Ratio -Only take the trades which provide you at least 1:2 Risk to Reward Ratio
AMEX:SPYEducation
by YongLiang
Top 10 Trading Psychology RulesTop 10 Trading Psychology Rules: 1. Plan the Trade & Trade the Plan -Plan all the potential trades beforehand, and trade accordingly with your plans 2. Always be Disciplined -Do not create excuses to break your own trading rules 3. Expect Losses -Do not take a trade unless you are willing to accept the risk 4. Emotion Management -Always analyze your trade objectively and with a neutral of mindset 5. Focus on Trading Well -As a trader, your focus is on making the good trades, not focus on making the money 6. Patient, Patient and Patient!!! -Patient to wait for the Best Setups to trade, do not trade when there are no good setups 7. Trade What You See, Not What You Think -Concern with the effects, not concern about the reasons behind of what are happening. Everything is on your charts! 8. The Trend is Always Your Good Friend -The easiest money is made trading with the trend 9. Trading Evaluation -Record down your trades, why are you entry and why are you exit, continuously improve yourself 10. Trading is a Marathon, not a Sprint! -Be realistic, trading takes time to build experience
AMEX:SPYEducation
by YongLiang
Technical Analysis?I have a straight question to you, and would love to hear your answer in comment section. What is technical analysis? Can you define it? Most people think that I am technical trader, but I am not. I have nothing to do with technicals as I don't use them, so what is the definition? I will write what I think about it, and it is only my subjective opinion. You can write your's too. There is no definition. Anyone can make up anything and call it technical analysis. The field now seem to encompass everything from drawing trend lines to astrology. Technical analysis started out with quite simple concepts, which are not all that dumb. In the early days, it was about looking for directional trends in prices and divergences between related market indexes. Experience told traders that when prices start moving in one direction, they are more likely to continue than to reverse. Technical analysis was just a way to visualize this concept. Divergences was mostly about comparing the Dow Jones Industrial with the Dow Jones Transport, the two most important indexes at the time, and draw conclusions from potential differences. Adding things like simple oversold/overbought indicators is still in the realm of sanity. Again, experience had taught traders that extreme short term moves are often followed by a sudden pullback. Emotions run wild as the price takes off, propelling the price further until a short term correction sets in when the buyers are already in and there’s no one left to push the price higher. Common sense things where technical analysis was used as a tool to visualize abstract phenomena. Then the problems set it. The visual nature of technical analysis lends itself to get-rich-quick stories. After all, there’s no need for all that hard work, right? Why waste time learning tough things and gaining real life experience when all you have to do is look at a chart and draw some lines? It was only a matter of time before this field was completely taken over by snake oil salesmen. To be fair, some of them are probably just delusional and not outright immoral. There are no rules for what technical analysis is. So it became everything. In particular, everything that is easily sold. The more colorful naming and background story, the easier the sell. At first we had the indicator explosion. An easy way to get famous in the field is to create an indicator. Especially if you manage to get that indicator included in standard technical analysis software packages. So everyone and his grandmother started making indicators in hopes of fame. It’s a comfortable illusion, that all you need is to find the right indicators and you’ll be rich in no time at all. Just get those parameters right. Then we have the field of exotic names. Doji, three little soldiers, spinning dragons, crouching tigers, ichimoko, harami, spanking monkeys, and tons of more colorful names. Well, I might have made some of them up, but if others are allowed to make up random exotic names, why can’t I? Beware of anything that sounds ‘cool’. Most likely it has no other use than to sell products that won’t help you. Do I say all Tech is crap? No, I wouldn’t go that far. There are actually plenty of professionals using concepts originating from technical analysis. Usually they don’t use the term though, for reasons made clear above. It has a very poor reputation. Trend following, the main strategy of the 300 billion dollar CTA industry, has its roots in technical analysis. A large part of quantitative, systematic trading is based on ideas from that came out of that field. Peace. TPP
FX:XAUUSD
by TheZabisyu
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