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J200 trade ideas

Has the global recession already begun?Taking a short position on the SA/JSE 40 as price has broken out of our dynamic support, pulled back and continued to breakout to the downside. On an Elliot wave perspective, it looks like we have completed an entire bullish wave as I have identified 5 motives waves in the Supercycle which means we would have to see 3 corrective waves going to the downside. Which means we should currently be forming wave A until price invalidates this. Not only do the Elliot waves point to price being bearish but I am confident we've reached a top in the South African stock market as price has failed to break above the high at 75470 and on the micro timeframes price has been making lower highs and lows since then. For my bearish stance to be invalidated I'd need to see price break above the range high at 73853.97. If not however, I will be looking to add more positions at the major higher low the market has created at 66423.89 as this would officially signal on the macro timeframes that price is breaking structure and is going to continue to go to the downside. I will be aiming to exit at the inception of the major dynamic support / the end of the corrective Elliot waves. TP - 47108.35 Invalidation / SL - 73853.97
TVC:SA40Short
by MngomezuluCapital
DID YOU KNOW? Trading has never been more...What was a realm for Wall Street titans and for the affluent investors… In the last couple of years, it has knocked its walls, and has broken the financial chains. Today, it’s at the hand to the everyday individual, regardless of their financial background. Just to put it into perspective. In 2003 until like 2007, trading was very limited. I had a very old-fashioned trading software which updated once a day. I only had shares to trade. And then as the years progressed, I was paying R17,000 a year to have a software that updated every 15 minutes. The struggle was REAL! But today, is a different story. You are in the best times every to trade. It’s the cheapest it’s ever been. It has more markets, instruments, options and features at your fingertips. And you can even start with your charting, preparation and work on your trading track record – essentially for FREE. So, if you’re not in the trading game yet – WHY NOT? And that’s just the start of it. DID YOU KNOW? Trading has never been more… #1: Affordable Trading, as we know it, has undergone significant transformations in the past decade. It is now more affordable than ever before. A combination of technological advancements, regulatory changes, and the evolution of trading platforms has significantly reduced the financial barriers to entry. Just look at TradingView? Many brokerages are in such high competition that they have had no choice but to: Cut brokerages Make minimal spreads for trade Remove the yearly platform fee Some even have a zero-commission trading platform The only expensive thing, with some brokers, is that you might need to have a minimum account size. But the money is yours. It stays in your account. And you might even earn interest just by keeping it there. It’s amazing. #2: Easier to Learn With the proliferation of online learning resources on YouTube, TikTok, websites - you can master the art of trading – FREE. Even most reputable brokers now offer comprehensive trading education, to help you on the way to trading their platforms. And many brokerages offer demo accounts where beginners can practice trading with virtual (paper) money. This way they can gain hands-on experience without the risk of losing any real money. #3: Accessible Trading has never been more accessible. Gone are the days when trading meant being physically present on the exchange floor or having to call your broker to place a trade. In today’s digital age, you can trade on your smart phone tablet or computer. Also, with the high competition – most great brokers offer their own customised trading apps and online platforms. And the variety is crazy. Whether you want to trade CFDs, Spread Betting, Futures, Options, Lots, or other instruments – the world is your trading oyster. Just go to TradingView and you’ll see hundreds of thousands of markets to choose from. (Stocks, indices, commodities, Forex, Crypto, ETFs, Bonds, Economic indicators and Funds). #4: Hospitable With brokers and market makers with their obligatory regulatory frameworks and criteria, around the globe, they are constantly pushing for more transparency and fairness in financial markets. They are also pushing for more educational sources. They are improving with HR and pristine customer services features. The odds are no longer heavily stacked in favour of institutional players. Such features help retail traders make informed decisions, level the playing field and make the trading world a more welcoming place for newcomers. So, we can see trading is becoming more affordable, easier to learn, accessible, and hospitable. And they will continue to do so and improve, which is why you have got to take the leap and harness what is available. As I mentioned earlier. Today the world is your trading oyster – Go fishing!
TVC:SA40Education
by Timonrosso
6 Rules of Successful Trading Once you become a trader. Once you think about trading every day. Once you have set your mind, soul, and heart into trading. There is no going back. You’ve reached the point of no return! And it’s thrilling and exhilarating once you’ve mastered this element to your life. So you might as well harness the true nature of what it takes to be successful. Here are 6 key rules every successful trader lives by. Always have a trading plan One hallmark of a successful trader is an effective trading plan. This is a self-journey and only you can endure it through different endeavours. Your trading plan acts as a roadmap and your game-plan, to guide you to your daily trading activities to help you make informed decisions. This plan should detail your system, risk and reward management along with your financial goals, risk tolerance, criteria for entering and exiting trades, and strategies for managing your trades. Every trade you execute should align with the objectives outlined in your plan. Also, evolve and adapt to your plan along with the ever evolving market world. Don’t procrastinate In the world of trading, timing and persistence is everything. Successful traders understand the im portance of making swift, decisive moves when the right opportunities arise. Procrastination, on the other hand, can lead to missed opportunities laziness and potential losses. So, get up, make your coffee and get to it. Also, remember to always keep a close eye on market trends, economic indicators, and relevant news events. This proactive approach will ensure you’re well-prepared to act promptly when your defined trading criteria are met. Remember, the market won’t wait for you, so you must be ready to seize opportunities when they present themselves. Be patient While it’s essential to act decisively. It’s also our goal to just….. WAIT. Be patient and only strike when you see that golden opportunity present itself. Sometimes, the best action is inaction. Sometimes, you have to just wait it out and stay out. Neutral is also a position. And you need to know when it is best to protect and preserve your portfolio. Successful traders don’t let impatience force them into suboptimal trades that fall outside their strategic plan. Just take the trade I’m seriously going to have a mug or a t-shirt saying. Trade well and just take the trade. When your plan indicates it’s time to trade, you need to overcome your hesitations and execute the trade. Traders must realize that not every trade will result in profit. So you might as well take the trade that lines up when it’s a high probability one. Even the best traders face losses. Even the best trades take losing weeks, months and even quarters! What matters most is your overall performance across many trades. As I always say, it’s not about the 1 trade but the hundreds of trades later. So, when the conditions of your trading plan are met, take the trade, and maintain your risk management strategies to limit potential losses. Keep learning and evolving Financial markets are dynamic and ever-evolving. As a trader, it’s crucial to keep learning and adapting to these changes. Stay updated with market trends, new trading strategies, and changes in regulations. Consider continual education a part of your trading plan. See what other successful traders are doing. See what other strategies they’re adapting to. See what new markets are available and what sectors are outperforming. Learn to earn. This ongoing learning process will keep you on top of your trading game and help you adapt your strategies as markets evolve. Don’t give up No matter what you do, remember. You only lose when you quit. Trading is a long-term game filled with ups and downs. The key is to view these setbacks as learning experiences, not reasons to quit. When faced with losses, successful traders analyze their decisions, identify mistakes, and learn from them. They maintain a positive mindset and understand that perseverance is crucial. Stay focused on your trading plan, refine your strategies, and remain resilient on your path to trading success. By incorporating these six rules into your trading routine, you’ll be well on your way to a profitable and sustainable trading career. Always have a trading plan Don’t procrastinate Be patient Just take the trade Keep learning and evolving Don’t give up
TVC:SA40Education
by Timonrosso
The JSE ALSI 40 - Boy who cried BULL again! Target 80.384The JSE ALSI 40 has been moving in this large somewhat frustrating Symmetrical Triangle since December 2022. I've been bullish with the index and have expected it to break above the apex by now. But the triangle just keeps on moving in its consolidation sideways range. Thing is, the up signs are showing. This market wants to fly up and the rest of the international markets are holding it down. But now with the breakout above the Falling Wedge with the S&P 500 and Nasdaq, maybe we can get our push up finally. Other indicators confirm upside to come Price>200 - Bullish - 7 needs to cross above 21 thought RSI>50 and higher lows are being formed. Target 1 is now moved to a higher 80,384. Can we get our breakout now. Us breakout traders have been patient enough...
JSE:J200Long
by Timonrosso
Cut out Useless Trading Data - 6 Points There is a curse of knowledge in the world of trading. And it comes a time where a new trader believes the way they can WIN is through… Knowing and applying as much info and data as possible. I’ve been there. In 2008, you should have seen my charts. They looked like Christmas Trees. Cut out the conflicting indicators. Cut out ANYTHING that does not make logical sense. Less is more with trading. Let’s explore some factors that can help you cut out the unnecessary data. Find One or Two Systems Only Trading systems are a collection of rules and parameters that traders use to determine their entry and exit points. With myriad trading systems available, it’s really tempting to dabble in different ones. And as a beginner trader, I understand it’s crucial for you to find yourself and your trading personality. However, once you find what system works for you. Once you find the ones that match your trading style, risk tolerance, and financial goals – Stick to them. Adapt, evolve, improve and optimise your strategy. When you absolutely master your strategy and your focus, you can gain deep expertise in those systems and utilize them more effectively. Minimize the Number of Markets Each market is unique, with its own set of rules, trends, and volatility. If you diversify into too many markets, it can dilute your focus and make it harder to understand the nuances of each market. Instead, find the markets that most definitely work you’re your strategy. Whether it be stocks, indices, Forex, commodities or crypto. Break them up into watchlists and the ones that don’t work with the system, well don’t include them obviously! Choose Only One or Two Time Frames Just as with trading systems and markets, time frames also require careful consideration. Whether you prefer day trading, swing trading, or position trading, it should tell you the time frames you should be focusing on. Select one or two time frames that align with your trading style and stick with them. I like daily for stocks, commodities and crypto. I like 15 minutes for Intraday trading indices and daily for identifying the Daily Bias. By doing so, you’ll avoid the confusion and contradiction that often comes from analysing multiple time frames simultaneously. Cut Out Unnecessary Indicators The year was 2008. I had 5 Moving Averages, 1 Bollinger Band, 1 MACD, 1 RSI, 1 Stochastics, 1 William %R, Volume, and even the ATR (Average True Range). The problem was. These signals were conflicting each other. Do you have any idea how difficult it is to back and forward test a strategy like this? And yes, all the information is at our fingertips. But it can also be the doom of our portfolios. Why? I realised one thing. Indicators, volume, price action etc… Is all based on ONE constant. Historical data. The data and information you see is all based on the past. There are no predictions, no certainties only probabilities. So you need to cut out the unnecessary information. Don’t fall for “analysis paralysis,” where excessive data hampers your decision-making. Choose a few key indicators that provide the most valuable information for your trading strategy. Focus on One or Two Financial Instruments Diversification is a key principle in finance, but it’s possible to overdo it. When I say instruments I mean CFDs, Lots, Spread Betting, Options, Futures etc… You know what a schlepp it is to have different journals for different instruments, trading the same things? Ye… Choose 1 or maybe two instruments (if your one broker doesn’t offer some markets you wish to trade). But there is no benefit in trading a whole bunch of trading instruments at once. Also when you spread your capital too thinly across multiple financial instruments, you’ll find it can complicate your trading strategy, portfolio and risk management. And it will make it difficult to keep track of your investments. Only Have One or Two or Max Three Trading Accounts Managing multiple trading accounts can be a logistical nightmare. Similar to what I mentioned above. It can lead to unneeded complexity in tracking performance, managing tax liabilities, and maintaining a balanced portfolio. Instead, limit your trading accounts to 1, 2 or max 3. This is so you can monitor your trading performance across different markets. For example. Forex is a completely different ball game to stocks (in my opinion). And so, I like to have two different trading accounts for each. Final words. Let’s focus on less rather than more going forward. Cut out unnecessary and useless data when you trade. And remember these point which is what we have covered today… Find One or Two Systems Only Minimize the Number of Markets Choose Only One or Two Time Frames Cut Out Unnecessary Indicators Focus on One or Two Financial Instruments Only Have One or Two or Max Three Trading Accounts
TVC:SA40Education
by Timonrosso
Important Trading Terms YOU need to KnowSorry but the truth is… You can’t get away from the trading lingo. There are at least 7 terms you need to deal with a day. But fortunately, they repeat and before you know it – they’re second nature. Let’s start with the most important terms – you’ll face every day as a trader. Symbol – Name of market you want to trade: The symbol represents the unique identifier of a specific financial instrument or market. It is the special name that is given for each market. For example, in the stock market, symbols are typically a combination of letters that represent a particular company’s shares. In the forex market, symbols are currency pairs such as EUR/USD or GBP/JPY. In the commodity market each have their own symbol i.e. Gold = XAU/USD, GCI Go to TradingView head over to Symbol search and start searching and adding to your watch list. Side: Buy (go long) or Sell (go short): The “side” refers to the direction of your trade. Buying (going long) means you believe the price of the instrument will rise, and you aim to profit from the increase. Selling (going short) means you anticipate the price will fall, allowing you to profit from the downward movement. The choice of the side depends on your market analysis and trading strategy. Quantity: No. of CFDs or lots: The quantity represents the number of Contracts for Difference (CFDs) or lots you want to trade. This is all dependent on your risk profile and portfolio size. CFDs allow you to speculate on the price movements of an underlying asset without owning the asset itself. The quantity determines the exposure and potential profit or loss of your trade. It’s important to consider your risk tolerance and account size when determining the appropriate quantity to trade. Order type (Market or limit): The order type specifies how you want your trade to be executed. A market order is executed immediately at the most current market price. This type of order guarantees execution but does not guarantee a specific price. So there might be slippage (where you get in versus where you wanted to get in) which can interfere with your Risk to Reward. A limit order allows you to set a specific price at which you want the trade to be executed. So basically, you LIMIT The price you wish to enter. The order will be executed only if the market reaches or exceeds your specified price. Validity: How long to hold: Validity refers to the duration for which your order remains active. Common options include: GTC: “Good Till Cancelled” where the order remains active until you manually cancel it. FOK: Fill or Kill: This type of order requires immediate execution of the entire order quantity. If the full amount is not executed, it is then cancelled. GTD: “Good Till Date” (GTD), where you can specify a specific date until which the order is valid. MIT: Market if Touched: This order is triggered when the market price reaches a specified level (trigger price). It then becomes a market order and is executed at the best available price. LIT: Limit if Touched: If a Limit if Touched order is triggered when the market price reaches a trigger price. However, it becomes a limit order with a specified limit price and will only be executed at or better than the limit price. Levels: Entry, Stop loss, and Take profit: These levels are essential in managing your risk and potential profits. Entry Level: The price at which you enter the market by opening a trade. Stop Loss Level: A predetermined price level at which your trade will automatically close to limit potential losses if the market moves against you. Take Profit Level: A predetermined price level at which your trade will automatically close if the market moves in your favour. What trading term do you want to know more about and let us know if this was useful!
TVC:SA40Education
by Timonrosso
Where to NEXT with the JSE ALSI 40? I hope UP!Do you want the JSE ALSI 40 to fall where we profit from all the shorts. Do we want the JSE ALSI 40 to rise, where we can profit from the longs. I'll tell you what I want. I always want the JSE ALSI 40 to rally. I don't mind being stopped out on shorts. I don't care about the shorts anyway. And the reason is because I am optimistic with South Africa. I want the companies to do well and I want to celebrate their success rather than downfall. So, no matter what the situation is I always want the JSE ALSI to rally. Take a look at the chart now... We see a change in the pattern. Since the last higher low. We have extended the Symmetrical Triangle. So in a way, it's within the formation and the price is likely to head up... On the other hand, if it breaks below it'll be a reversal pattern and the price will likely continue down. Let's hope for the prior analysis as I'm an optimist.
JSE:J200Long
by Timonrosso
Why MOST Traders QuitI have said this many times. You only lose when you quit. Until then you’re either earning or you’re learning. But the issue is majority of people quit trading. And it goes far beyond just money lost. I say that because the essence of trading is playing with money you can afford to lose and you can psychologically handle. Right? So, it goes beyond money. If you’re thinking of quitting trading, first give this piece a read and let’s identify the cause and it might help you to carry on. You’re closer today to achieving your trading goals than yesterday. The Pitfalls of Financial Trading REASON #1: They blew their account by risking too much One of the primary reasons why many traders ultimately quit the financial markets is the common mistake of blowing their trading account. There are three main reasons you blew your account. You risked far too much on certain trades. You did NOT adhere to strict money management principles. Your portfolio was tiny (Under $1,000) to start off with. So the costs, the brokerages, the margins were all too much. It’s like flying a plane at a low altitude hoping you won’t strike a mountain. REASON #2: They keep adapting losing strategies based on non-tested methods Another reason for you to abandon your trading is this. Your methods, strategies and systems are losers. If you back and forward test, it yields negative results. So, technically the system is achieving what its numbers are in a way. I’ve back tested a LOT of strategies in my youth. 100s of thousands of parameters, indicators and criteria. And 89% of them were just plain losers. Don’t think by logic, that the system will work. Don’t think by a few months, will dictate a systems complete and eternal performance. Don’t just follow a trader’s strategy and adapt to your own without any backtested results. Without proper testing and evaluation, you are at risk of adopting strategies that are based on faulty assumptions or rely on limited historical data. REASON #3: They go against their strategy as their ego takes over and they lack confidence Ego is a dangerous trait to have as a trader. And with you feeling like you know better than the market and deviating from your plan, is a recipe for disaster. Do it once, you’ll do it again. Do it a few times, and you’ll get right back on that emotional roller coaster that comes with trading. And it will grow and infect your trading as it will lead to even more impulsive actions and irrational decision-making. Your confidence will get shot. Your vibrations within yourself will be depro and will reflect onto your trading performance. The psychological pressures associated with trading can magnify the impact of losses and amplify self-doubt, ultimately push you out of the game. REASON #4: They can’t weather through drawdowns NOTE: Drawdowns, which refer to the decline in a trader’s account value from its peak, are an inherent part of trading. Here’s something funny. When you go through good times with trading, it almost feels normal. And you can go through 6 months of great upside for your portfolio. But when that one or two months drawdown kicks in (inevitably it will), time feels different. It feels like an eternity of failure and with the feeling of you’re never getting out of this.. Unfortunately, many traders find it challenging to cope with these challenging phases, leading to frustration and ultimately quitting. Am I right? Well as my friend and great colleague Igor said to me: Your biggest winning streak and your biggest drawdown is still to come. So you might as well embrace it with strict money management principles along the way. Successful trading comes with the ability to easily withstand drawdowns and navigate through extended periods of market downturns. Also, psychologically you may find as a new trader that when you endure through longer periods of downside in the market, it can be both mentally and emotionally draining. Extended periods of drawdowns can cause a few problems: It can erode a trader’s confidence It can take away their optimism It can make them feel envious over other traders who are winning It can demotivate them to carry on It can cause them to make irrational decisions It can lead to over trading and revenge trading It can make them quit. They find the next “best” thing, onwards to the next holy grail (which never arrives). REASON #5: To continue the pursuit of the next “best” thing People follow where they think the quick money it. They are constantly on the quest to find their holy grail. Sure, trading isn’t for everyone. And Yes trading is the hardest and most easiest way to make an income. But, you seek will also require a ton of research, psychology, sacrifice and time. Nothing of high reward comes without a degree of risk. Bigger the reward, greater the risk. Or everyone would make a ton of money, right? So don’t fall into that trap of jumping to the next lily like a frog… Traders who constantly search for the next big thing end up chasing elusive dreams instead of focusing on developing their skills and understanding the markets. The reality is that there is no magic strategy that guarantees success in trading. The markets are ever-changing, and what works today may not work tomorrow. It is important for traders to recognize that trading success is not about finding a secret shortcut or relying on external factors beyond their control. It is about continuous learning, discipline, and a willingness to adapt to changing market conditions. Develop your robust trading plan, manage your risk effectively, and stay focused on long-term goals. Those factors alone will keep you on the right quest to trading well.
TVC:SA40Education
by Timonrosso
1
6 IMPORTANT Trading Orders You need To Know!DO YOU KNOW THE 6 TRADING ORDERS? There are many trading orders that a broker can offer. You’ll just need to confirm on the platform or give them a call, which ones they have. And it’s important to know which one suits your trading needs best. Before you buy or sell a trade, there is usually a setting that you can choose to execute your trade. Common options include: 1: GTC: “Good Till Cancelled” Where the order remains active until you manually cancel it. 2: FOK: “Fill or Kill” (Settle!) This type of order requires immediate execution of the entire order quantity. If the full amount is not executed, it is then cancelled. 3: GTD: “Good Till Date” Where you can specify a specific date until which the order is valid. 4: MIT: “Market if Touched” This order is triggered when the market price reaches a specified level (trigger price). It then becomes a market order and is executed at the best available price. 5: LIT: “Limit if Touched” If a Limit if Touched order is triggered when the market price reaches a chosen or trigger price. 6: GTC (Good Till Cancelled). This way you’ll know that your position (order) will stay in the market until you cancel it manually.
TVC:SA40Education
by Timonrosso
1
Just Don't Trade When...Just Don’t Do It Trader By now, you know what to do as a trader. I’ve pretty much drilled in your mind. You can hear my voice echo the 4 Ms. But one overlooked thing that’s also important… Are the things not to do. Let’s crack into the 5 things… #1: DON’T fear losing – It’s just the cost of trading Losing trades are an inevitable part of trading. So why fear losses if they are going to come. And it’s not just one or two losses. You’re about to take thousands of losses in your life. But don’t see them as losses. Instead, view them as the cost of doing business in the markets. Every trade carries a level of risk (hence we use stop losses in every trade). And losses are opportunities to learn and refine your strategies (if need be). So make it natural to embrace your losses as a part of the trading process. This way you’ll cut the ego, and take on each trade with a more objective and focussed point. #2: DON’T dwell on past failures – You are only as good as your last trade While it is essential to learn from past mistakes. If you dwell on them, they will excessively hinder your hard worked progress. Trading is an ever-evolving journey, and each trade presents a new opportunity. Instead of fixating on past failures, blown accounts, big drawdowns and times you just F*ed up with your trading system and mentality… Rather focus on the present and future. There is only NOW and what is to COME. So apply the past time lessons and focus on improving your decision-making performance in the next trade. You are only as good as your last trade. #3: DON’T expect fast riches – This is a slow and gradual process Trading is not a get-rich-quick scheme. If you expect to make it big in the first three years, I have news for you. Unless you already have a million rand portfolio to grow and bank from, this is going to take take. Cut out these unrealistic expectations because it’s going to be an emotional ride with excessive risk-taking. Instead, adopt a long-term perspective, set realistic goals and understand that trading success is a gradual process. Let the power of compounding work in your favour over time. #4: DON’T compare yourself to others – Your personality & risk profile shape you Each trader is unique. You are unique. Therefore, you have different risk tolerance levels, trading styles, and market perspectives. If you compare yourself to others, you’re going to feel inadequate and you’re going to enter into temptation on imitating their portfolios. It is essential to embrace your own strengths and weaknesses as a trader. Understand your personality, risk profile, and trading preferences, and align your strategies accordingly. Find what works for you and develop a personalized approach that suits your individual needs and goals. Trading is a self-learning journey that takes time and effort to master. #5: DON’T give up – You only lose when you quit! Persistence is key in trading. It is natural to face challenges and setbacks along the way. But the only time you truly lose is when you give up. Stay committed, maintain a positive mindset, and keep pushing forward. You still being in the game is what will differentiate you between failure and success. So let’s conclude what you must NOT do… #1: DON’T fear losing – It’s just the cost of trading #2: DON’T dwell on past failures – You are only as good as your last trade #3: DON’T expect fast riches – This is a slow and gradual process #4: DON’T compare yourself to others – Your personality & risk profile shape you #5: DON’T give up – You only lose when you quit! Just don’t do it, trader!
TVC:SA40Education
by Timonrosso
1
Revenge Trading is Lethal - 5 Reasons Why!Do you feel it in your bones. Where do you want to: Take trades to make up for losses? Take trades for the sake of trading? Take trades out of emotions and gut (gat feel)? Take trades to make a quick buck? If so, you have felt the power and dangers of Revenge Trading. TO put it blunt. Revenge trading is detrimental, dangerous and just plain stupid for any traders to succumb to. I feel like I can finish the article already as I have said what I needed to. Not just yet! You need to understand why Revenge Trading is to your downfall. Let’s start with these: #1: Impulsive decisions are dangerous In the heat of the moment, you just want to take an impulsive trade. This can lead to disastrous outcomes. Revenge trading happens when you want to try recoup losses quickly. And so traders abandon their strategies, systems and rules. And they take on unwarranted risks. This will stop you from making good, calculated, logical and well-informed decisions based on sound reasoning and market research. Don’t do it! #2: Trading on emotions is deadly Emotions such as fear, greed, and frustration have no place in trading. Revenge trading is fueled by these emotions. And this causes traders to deviate and steer way from their plans by instead acting irrationally. What then? Bigger losses, unnecessary risks to the portfolio and skewed results on your trackrecord. Your hard earned and timely worked on journal! Is it worth it? I think not. Cut out your emotions and work at being calm and take on the more logical approach, devoid of emotional interference. #3: Violating trading rules is damaging Every trader should have a set of well-defined trading rules in place. Not just rules but also a list of criteria. Revenge trading typically involves disregarding these rules and just going against everything you should do. Basically, what the average dumb retail trader does which results in 98% of traders losing in this financial endeavour. Violate your rules and there will be severe consequences. Loss of confidence. Bigger losses More losses Erratic wins (which make you want to do it again and again and again) Not worth it. Don’t do it. #4: Too much unnecessary risk You know you’re using your hard earned cash to trade and build a portfolio right? So why are you burning it and cutting it up like it’s nothing? This reckless behavior can lead to bigger drawdowns and can even wipe out trading accounts entirely. Don’t do it! #5: Creates an ongoing cycle of doing it again Great! Once you have violated your rules, gone against your strategy and pretty much gone ape or rogue on trading – it takes a lot to gain ones integrity and discipline back. One of the most dangerous aspects of revenge trading is its cyclical nature. Break the rule, you’ll break it again. Cheat, you’ll cheat again. Enter a gambling mentality and you’re in trouble. Bank a winning rogue trade and you’ll succumb to the trading world of discretionary action. However, if these subsequent trades result in further losses, the cycle repeats, trapping traders in a never-ending loop of revenge trading. Breaking free from this destructive pattern will then need a ton of discipline, self-awareness, and a commitment to sticking to one’s trading plan. So please be careful. Trade well! Don’t trade like gambler. Avoid the perils of revenge trading by all means, starting from today. And when you feel the need to do it (like a junkie), come back and read this article. Had to be said.
TVC:SA40Education
by Timonrosso
Traders Help the Economy in 4 Ways!When you trade and invest, there are many elements that you will continue to help contribute to. I can think of 4 main ways including: Way #1: You help with liquidity (volume) Remember, you are the intermediary in the markets. When you exchange money and buy and sell, you’re helping provide liquidity and volume. This makes it easier for other market participants to trade and manage risk. No matter how small or big the account size is, every trade counts. (Similar to the butterfly effect). Way #2: Helping our fellow brokers and managers Yes I know most people can’t stand the fact of the fat cats making millions of rands off other portfolios. But in South Africa, I find that most brokers are very small and don’t earn a lot of money. (Some small brokers earn under R25,000 per month). So when you buy and sell trades, you will help pay the small brokerage fees, which will aid to the salaries of the brokers you are using. Way #3: When you pay brokerage and fees, it creates more jobs When you pay the brokerage and trading platform fees. You are not only helping the brokers. But also the company they work for. The more money that goes into the firms, the more jobs that are created for other employees (Facilitators, marketers, support staff, risk managers, accountants, analysts, domestic workers, etc…) Way #4: This brings growth to your broker or market maker When your broker is doing well, as they have good clients and investors – this gives them a bigger incentive to help build and grow the company further including: · Better technology. · Better innovation · Better efficiency · Better features in the business This will also improve your experience with their growth developments. And so, I’m sure you can see that even if you want to trade for yourself, you will still be helping many companies, people and the economy as a whole… Nothing to feel bad about.
TVC:SA40Education
by Timonrosso
5 DANGERS of Trading Penny StocksJust so you know. I believe if you’re following a world renown and successful Penny Share expert, you’re in good hands. They are able to spot low risk investments and guide you through the process of owning great Penny Stocks. But as a trader , who only looks at charts – THIS IS DANGEROUS TERRITORY. Remember, Penny Shares are high risk, high volatile, low credible companies that are LOW prices i.e. Under $1.00. And so, I just want to write as a trader point of view five key reasons why penny stocks can be dangerous to traders. DANGER #1: High Volatility (Jumpiness) Penny stocks are notorious for their high volatility. These stocks tend to experience rapid and drastic price fluctuations, often without apparent reasons. I’m talking about companies that can jump 10%, 30% and even 70% in a day. The lack of stability and price predictability can make it very difficult for traders to make informed decisions. Sudden price jumps or drops can result in significant gains or losses within a short period, amplifying the risk factor. And if you place your stop loss within a tight range, there’s a bigger chance you’ll get stopped out. DANGER #2: Low Liquidity (Less Volume) Think of Liquidity like the flow of water. It tells you the ease of being able to BUY or SELL a market, without impacting too much of the price. Once again, we look for low to medium volatility. Penny stocks typically have low liquidity due to limited trading volume. With fewer buyers and sellers in the market, it can be difficult to execute trades at the prices you want. And this leads to slippage and even higher transaction costs. Also, low liquidity may also prevent you from even entering or exiting your positions quickly. And this can even TRAP you in an unfavourable market environment for an extended period of time. DANGER #3: Not Established Businesses Penny stocks are often associated with small, early-stage companies that are not yet established in their respective industries. These companies may lack a proven track record, have limited financial history, and face various operational and market risks. So if you want to invest in these type of companies as a trader, it’s better you do it with fundamentals, research, business models and future prospects. If you do it purely on speculative purposes, this could be very risky for your portfolio. DANGER #4: More Likely to Head to Zero Yes all trading requires levels and degrees of risk and rewards. But it is not worth it, if some petty company is doing really badly and is showing signs of going to 0.00. Penny stocks are more susceptible to declining in value and potentially heading towards zero. I mean, South Africa has witnessed instances where penny stocks have experienced substantial losses, which took out a ton of investors. For example, companies like African Bank Investments Ltd (ABIL) and Oakbay Resources and Energy Limited serve as cautionary tales, where investors lost huge amounts as these companies approached or reached bankruptcy. Talking about bankruptcy. DANGER #5: High Chance of Bankruptcy and Liquidations Penny stocks are also more likely to go bankrupt or get liquidated compared to a Blue-chip stock. This is because of the nature of the companies, the inexperience, the lack of funds and structure, as well as its credibility. Financial instability, mismanagement, or unfavourable market conditions can lead to the collapse of these businesses. We saw this also in South Africa with the liquidation of Sharemax Investments and the bankruptcy of Pamodzi Gold Limited. This lead investors with little to no value for their investments. So remember this as a traders We want low volatility, high liquidity (volume), credible companies with great reputations, track record and credibility. And we want attractive charts that work with our trading strategies. If you want to be a savvy Penny Share investor that's fine. But as a trader, I have given my precautions.
TVC:SA40Education
by Timonrosso
Optimal Guide to Action Trades BetterThere are only a few decisions you need to make as a trader. When you actually need to press buttons to action trades. To enter, to adjust and to exit. It’s crucial for you to know when is the right time to do so. You need to consider certain factors and criteria to enhance the chance of profitability. And at the same time to mitigate risks. So here are four optimal actions you’ll need to take. When the Trading Signals Line Up – ACTION! This one is a given. When your trading system, strategy and signal all align. This refers to the convergence of multiple indicators or technical analysis tools, such as breakout patterns, Smart Money Concepts, moving averages, trend lines, or oscillators. When these signals confirm each other, it presents a higher probability trade setup. You need to wait for the confirmation though and the go ahead. This way, you’ll gain the competitive edge for when to enter and to avoid premature trades. Adjust the Stop Loss or Take Profit Levels – ACTION! During a trade, it is essential to monitor the market closely and be ready to adjust the stop loss or take profit levels (according to your strategy). This should NOT be guess work. This should be calculated on probabilities and in a way that you can optimise the strategy in a mechanical fashion. The stop loss is a predetermined level that limits the potential loss on a trade. While the take profit is a predefined level at which a trader intends to exit the trade with a profit. As the market evolves, price action and new information may necessitate revising these levels to protect profits or minimize losses. Which we often do as traders to increase the win rate and lock in potential and minimal profits. Traders should remain flexible and make timely adjustments to ensure their trade is aligned with the prevailing market conditions. When the Time Stop Loss Hits – ACTION! In certain trading scenarios, there may be a need to exit a trade before it becomes a long-term investment. This is particularly relevant in markets where overnight positions incur daily interest charges, such as in some derivative or forex markets. Traders must set a predetermined time stop loss i.e. 7 weeks holding a trade. You don’t want to incur too many interest charges. You don’t want to MARRY a trade. You don’t want to have capital tied up in stock during nonperforming trades. This is an opportunity cost where you can choose better trades to line up. If this time stop loss is reached, it is prudent to exit the trade (no matter what time of day it is), even if it is still within the specified stop loss or take profit levels. Either you’ll take a less than desired profit or less than expected loss. By adhering to the time stop loss, traders can avoid accumulating excessive interest charges and maintain your trading strategy’s integrity. When a Freak Anomaly Spooks the Market, like a Black Swan – ACTION! In rare instances, unforeseen events or anomalies, often referred to as Black Swan events, can greatly disrupt financial markets. These events are characterized by their unpredictability and magnitude, causing extreme market volatility. Normally when a market or index moves 10 times the standard deviation of it’s normal move. When such anomalies occur, it is crucial to act swiftly and exit the trade. Trying to ride out these events can lead to substantial losses. By recognizing the abnormality and promptly exiting the trade, traders protect their capital and avoid unnecessary risks associated with highly volatile market conditions. That’s it. A few but powerful times you need to take action to lock in, protect, manage, bank and call it quits. Master this and you’ll make better and well-timed decisions and adapt your positions to changing market conditions.
TVC:SA40Education
by Timonrosso
4
Why you DID NOT take the trade - 4 REASONSSo you never took a trade again? This could be where the problems are rising. It’s also where you are probably missing out on what could help take your portfolio out of the drawdown. And sometimes, despite favourable market conditions, you may find yourself still hesitating to enter a trade. I want to explore four common reasons why traders fail to take the trade and how to overcome them. #1: The market moved too much One of the most common reasons traders hesitate to take the trade is that… The market has already moved significantly, and they fear they have missed the opportunity. However, it’s important to remember that the market is constantly in motion. The train will move and there is always an opportune moment to get into a trade. A sound trading strategy should take into account different market conditions, including volatile ones, and provide clear entry and exit points. If the market lines up despite how high or low it’s gone. Just take the trade. #2: You’re scared to lose the trade FOLO or Fear Of Losing Out is another common reason traders hesitate to enter a trade. While it’s natural to want to avoid losses. It’s important to remember that trading involves risk, and losses are inevitable. A sound risk management strategy, including setting stop-loss orders and managing position size, can help you to minimize potential losses and build confidence in entering a trade. #3: Too much money to spend Traders may also hesitate to enter a trade if they feel they have too much money to spend. Take oil for example. Most market markets (brokers) offer you to buy Brent crude but you have to buy 100 contracts as a minimum. In this case, it MIGHT be too much money to spend. Not because of how much of your portfolio you’re using up, but also because the risk might outweigh 2% of your portfolio. Then you get other markets like the JSE ALMI 40, where you’ll need to spend around R9,000 to enter a trade. It sounds like a lot (especially if your portfolio is less than 10,000. But, that’s why one should start with a larger minimum account size. I started with R30,000 in 2003 and even then it was too little to grow into a substantial amount. Then when it grew to the first R150,000, I started feeling comfortable with the portfolio size and it opened more opportunities to trade additional markets. So, that’s why if you want to take trading seriously, you got to cough up the cash into your portfolio and trade accordingly to strict money and reward management. #4: No trust in the system yet This one is a given and the most abundant reason to NOT take a trade. You might hesitate to enter a trade if you don’t have faith or confidence in your trading strategy or system. In this case, it’s essential to go back, review and test the strategy, ensuring it aligns with personal trading goals and is backed by sound research and analysis. When you build trust in a trading system, and you take the time and patience to see the good and the bad, then your confidence will grow. And that will be an essential step towards taking more trades to help grow your portfolio. Why don’t you take trades when you should? Is it because: You don’t trust your system You’re scared to lose money You don’t trust certain markets You don’t have enough money to trade different instruments You’re not ready with your strategy You don’t have confidence with yourself, discipline and emotions yet? Find them, harness them, work on them and you might have your answer.
TVC:SA40Education
by Timonrosso
JSE ALSI 40 M Formation - Breaking down We have a ton of different signals with the JSE ALSI 40. This is where trading can get a bit tricky and frustrating. But it's for this reason, one needs to learn how to hedge positions. And by hedge I mean, hold equal number of shorts and longs. So we can see, there is an M Formation in the process. The price has broken down and has broken below the Symmetrical Triangle. It is early days as the breach has been only a day, so we will need to see. However, there are mixed signals all around. 7>21>200 - Bullish but turning RSI<50 - Bearish by nature Smart Money Concepts. There are 2 Sell Side Liquidity Order Blocks. Either Smart money could buy big time around its current price which will cause a fakeout and the price will go up. OR Smart Money could skip this order block and buy into the next SSL OB at 67,000. The bias is bearish as things stand, but do to the mixed signals - This is cautionary. Stay strong and hedge!
JSE:J200Short
by Timonrosso
JSE Top 40 Confirming a New Weekly LowBy closing above the weekly resistance trendline, the JSE Top40 has confirmed it is in a new weekly cycle which is upgrades our DXY trade idea from “Rest” to “Downtrend”. Looking at the daily time frame, the Top40 is nearing oversold levels and is likely to reach a daily cycle peak between day 41-50 to back test the broken trendline. Thereafter it is expected to break the supporting blue trendline into a cycle low. At that point one can go long on any missed opportunities within the Top40. Look out for ideas to be shared for the best shares to pick with enough room for a healthy uptrend into 2023.
JSE:J200Long
by runyamhere
Are Markets Set for Turmoil?There is a famous adage that says history does not repeat but often it rhymes. Recent events have shown some cracks forming within the US financial system with the run on Silicon Valley Bank $SVB. Many quarters have been calling for bailout of the bank to prevent contagion in the market. We are also entering the week of inflation announcement for the US economy, if the number shows inflation not changing or ebbing higher, we could have a perfect cocktail of fear inducing events, what with the FOMC meeting coming a week later. Jerome Powell might be forced to go for higher rates for longer guaranteeing more problems in the system. Given the situation, one can prepare themselves psychologically for a panic situation where markets get into turmoil. Best to use the time before markets come alive to rehearse an action plan, the panic of 2020 caught me still learning, so the fear hit the roof. Now I am more calmer and I do scenario analysis on what to do and what to look out for. Analyzing the cycles of the markets helps me see the potential risks & opportunities. We await opening of futures, remember, KEEP CALM & MAKE MONEY, YOU ONLY LOSE WHEN YOU SELL.
JSE:J200
by runyamhere
5 STUPID Trading Advice SayingsIt’s true. When it comes to financial trading, everyone has an opinion, and there is no shortage of advice floating around. However, some advice is just plain ridiculous and some tips can be downright detrimental to your trading success. I want to cover the 5 stupid trading advice points, that many traders still follow and why you should avoid them by all means. #1: Go Big or Go Home This advice suggests that you should take significant risks in trading. You should aim for massive gains. And you should adopt the casino mentality of going full port! It is true that higher risks can lead to higher rewards. But when you adopt a “go big or go home” mentality, it can result in substantial losses that are difficult to recover from. Instead, follow a disciplined approach to risk management, using appropriate position sizing and stop-loss orders to protect your capital. Risk little to make a little more. Risk 2% to make 4%. Or risk 1% to make 3%. Those small gains will eventually outweigh the losses. #2: The Next Trade Will Be Better If you believe that the next trade will magically be more successful than the previous one, you’re in for a bad time. This is nothing but a dangerous mindset to adapt to. This belief can lead to overtrading and a lack of discipline when you stick to your trading strategy. To avoid falling into this trap, focus on maintaining a consistent and well-defined trading plan, rather than trying to chase the elusive “better” trades. #3: Follow Your Heart Emotions are proven to be the trader’s worst enemy. They will often cloud judgment and lead to impulsive decisions. “Follow your heart” in trading and you’ll find you’ll ignore your strategy and you’ll take irrational risks. Instead, rely on your trading plan, technical analysis, and fundamental research to make informed decisions, and always keep your emotions in check. #4: Everything Happens for a Reason When you depend on fate, the stars and the mysterious cosmic plan, it is a surefire way to lose money in trading. The stock market doesn’t work on esoterical means. It works on simple demand, supply and volume. The financial markets are also influenced by countless factors, from economic data releases to geopolitical events, and it’s essential to understand these factors to make well-informed trading decisions. Don’t rely on fate or superstition when trading. Instead, focus on analysis, strategy, and risk management. #5: Work Harder and You’ll Win More While hard work and dedication are essential for success in any field. The belief that you need to work harder in a trading day, will guarantee more wins in trading is misguided. If the environment is not conducive. Or trades have not aligned according to your strategy, it’s pointless taking more trades for gain. Think of sideways markets. Whether you buy (go long) or short (go short), you’re more likely to fail. Trading is not just about putting in the hours; it’s about working smart, refining your strategy, and maintaining discipline. Instead of trading harder, focus and develop a comprehensive trading plan, continually educate yourself on market dynamics, and consistently reviewing and refining your strategy. And of course. JUST TAKE THE TRADE – When it lines up according to your strategy. Can you think of anymore?
JSE:J200Education
by Timonrosso
5 QUESTIONS Before you Take your TradeWith each trade you take… There are these 5 standard questions you’ll need to ask an answer. Jot these down and have them ready… Do I Have a Trade Lined Up? When you go through your watchlist. You need to see any opportunities in the market that align with your trading strategy. These should stick out like a sore thumb. If it’s not, then it’s probably not a high probability trade. It’s important to analyze the market trends and indicators to identify potential trades. This will help you to make informed decisions and avoid taking unnecessary risks. Do I Have a Trading Strategy? Once you have identified a potential trade, it’s important to have a solid trading strategy in place. Your strategy should outline the rules for entering and exiting trades, as well as risk management guidelines. Follow your strategy and avoid making impulsive decisions based on emotions or market rumors. Where Should I Place My Trading Levels? You got the strategy so now you have to set up your trading levels. (Entry, Stop loss, Ghost level, Take profit levels) Are you using Order Blocks, key support and resistance levels, patterns, indicators or trend lines? Whatever you use, keep consistent to determine where to place your trading levels. This will help you to choose your trading levels based on the R:R for each trade. How Much Am I Trading? Trade size is crucial. You need your calculator to work out your risk per trade. This will help you to manage your risk effectively and avoid making emotional decisions. Your risk management plan should outline the maximum amount you are willing to lose on any given trade, as well as the maximum percentage of your trading account you are willing to risk. What Is My Exit Strategy? exit strategy should outline the conditions under which you will exit a trade. So you’ll know where to cut your small losses, ride your winners, lock in profits, or even adjust your take profit levels when the markets move well in your favour. Also, make sure you stick to your exit strategy and avoid making emotional decisions based on market fluctuations. THEN YOU’RE READY TO EXECUTE! Once you have gone through the five questions… It’s time to ask yourself whether you are truly ready to take the trade. Focus your mind, clear the distractions, confirm everything is ready to go… That takes emotional discipline. You got the questions, now go start asking and answering them with your trading…
JSE:J200Education
by Timonrosso
When you’ve taken a trade – Let It Go!One of the key principles of successful trading is… Once you have taken the trade to just let it go and allow it to run its course. The system lined up – tick. The entry orders are all in place – tick. It matches your risk and reward criteria – tick. You know your trade size – tick. Now let it go. You may get the urge to interfere, change the levels and lock in profits early or limit losses even more. You need to resist the urge. Here are some factors to consider… Don’t Interfere… When you’ve taken a trade, it’s important to have a plan in place for how you will manage it. This means you’ve got your entry, stop loss and take profit in place. These actions may seem like a good idea at the time. But they can often lead to bigger losses, smaller profits and even missed opportunities. But then there are times where you need to adjust the course. You might even have a time stop loss. Or a strategic and mechanical criteria for when to adjust your levels. But other than that, you need to have the discipline to stick to it and resist the temptation to interfere with your trades. Don’t Get Excited When It’s in the Money One of the most common mistakes that traders make is getting too excited when they’re in the money. You might feel overconfident and “know-better” about a trade. Or you might have this irrational decision-making idea to quickly move your stops and take profits, which can quickly erase any gains that you’ve made. It’s essential to remain level-headed and stick to your plan, even when your trades are performing well. To avoid getting too excited when you’re in the money, go back to your journal and look at how your trades have played in the past. It’s important to have a clear idea of your risk tolerance and profit targets before you enter a trade. This will stop you from making any quick and unnecessary decisions along the way. Don’t Fear When It’s Going Against You Another common mistake that traders make is letting fear dictate their decisions when a trade is going against them. It’s natural to feel anxious when you’re losing money. But it’s important to remember that losses are a normal part of trading. We all take them and we are all bound to take them more times than we wish to think. To overcome the fear of losses, it’s important to focus on the long-term goals of your trading strategy. One way to do this is to maintain a positive mindset and view losses as “costs of business” and as learning opportunities rather than failures. Stay calm and level headed. Also stop risking so much that it interferes with your psychology. When you feel emotional take a step back or it could lead to even bigger losses. Don’t Watch Every Tick Finally, it’s important to resist the urge to obsessively watch every tick of the market. This can lead to overtrading and emotional decision-making. And you’ll find it will quickly derail your trading strategy. Instead, it’s important to focus on the big picture and have a long-term perspective on your trades. Close your computer once you’ve taken a trade. Or close your trading platform and move onto something else. You’ve done your job now stop watching every tick the market moves. By doing so, you’ll be less likely to make rash decisions based on short-term fluctuations in the market. I hope this helps and if there is one thing to remember out of them all. When you’ve taken a trade, just let it go and let it run its course.
JSE:J200Education
by Timonrosso
1
When to FEEL THRILL when Trading - It may surprise you!First let me tell you. NO you should not feel thrill when you take a profit. NO you should not feel thrill when you are on a winning streak. NO you should not feel thrill after a day, week or month of upside. But I’m not going to be a wet blanket. As a trader, including me, there are times to feel thrill. Trading is a process, it’s a lifestyle, it’s a game, it’s your control of your financial future. So let’s explore the times you should feel thrill. #1: Analyse the markets A major part of trading is assessing the current state of the markets and identifying potential opportunities. This involves creating your strategy, finding the indicators that work best and identifying the different systems (chart patterns, trend lines, Smart Money Concepts) etc… This process is super exciting part on the journey to becoming a trader. #2: Optimise your strategies Creating a strategy is one thing. But optimising and maximising your system is an ongoing thing. It’s crucial to continuously fine-tune your strategies and adapt to the ever-changing market conditions. When you identify areas for improvement and make changes that lead to better performance, the thrill of knowing that you’re on the path to success can be awesome. #3: Search for high probability trades One of the keys to success in trading is finding high probability trades. It’s these trades that will offer a favorable risk-reward ratio and a high chance of success (regardless whether they win or lose). The hunt for these opportunities is always fun and it’s almost like going on a daily treasure hunt. And spotting the highest probability trades, require a deep understanding of the markets and the ability to spot subtle patterns that others might miss. When you uncover a high probability trade and execute it successfully, the feeling of accomplishment is also a great feel. #4: Reading Fundamentals Sure your strategy might not comprise of fundamentals or news. But still learning about the markets, companies, indices and other micro and macro aspects, is interesting. A solid grasp of fundamental analysis is essential for any serious trader. This involves assessing the financial health of companies, industries, and economies to identify why markets move the way they do. When you can successfully combine technical and fundamental analysis to make informed decisions, the thrill of knowing you have an edge in the market is undeniable. #5: Monitor your results and stats As a trading boss… You need to track, analyse and assess your trading performance. You don’t get more power and thrill as a trader, when you have control of your financial markets. When you see your strategies paying off and your account balance growing, the thrill of your hard work and dedication materializing into tangible results is incredibly rewarding. Conversely, it’s also thrilling when you analyse your losses where you can gain valuable learning experiences. And this will help provide insights into areas for improvement and will motivate you to refine your approach. #6: Find new markets to trade Do you think I was looking at AI, VR, Metaverse type companies to trade 10 years ago? Nope! These markets weren’t in fruition with trading as they are today. So as a trader, this is always an exciting and thrilling venture with trading. To explore, adapt and add on new markets into your watch list. When you add and enter these new markets to your strategy, this can expose you to a whole new set of opportunities and challenges. And this will help broaden your horizons and deepen your understanding of the financial markets. So now you know when to embrace thrill as a trader. Use them to fuel and propel you toward achieving your goals. When else do you feel thrill?
JSE:J200Education
by Timonrosso