In trading stocks a person uses a plan to trade a Universe of stocks.
And within this Universe is a hot list of stocks that are in the Present as stocks that are and will be providing a profits segment.
You continually rotate through this hot list of stocks which, in turn, is continually updated from the Universe. the Univierse is kept current continually as well.
With respect to any trade, it is taken on at the low of the cycle for a long trade or at the high of the cycle for a short trade.
This thread discussion is about one thing and one thing only: how to conduct the busines of trading after entry.
You hold through the three stages of the pattern.
The posts so far show that the posters do NOT understand the market pattern for long or for short trend segments.
If a stock is not making money, then another stock is substituted for it.
One of tradegies of trading is that traders THINK stocks go up and down.
It is difficult to penetrate such minds with alternative viewpoints.
A remarkable example of this difficulty was a poster named DBPhoenix who though stocks went up and down. He illustrated his viewpoint with a supply and demand incorrect model.
Below are two columns. One column shows the up down; on the left; the market's dominance is shown on the right.
Up dominant
Down Non Dom
Up Dom
Down Dom
Up Non dom
Down Dom.
Up and down is how most people think the market goes.
Above they see three pairs of up downs.
What is actually happening is two trends: a long then a short.
The long and the short have a pattern: Dom, Non Dom, Dom.
Lets do what the OP does.
He enters a trend after a down ends and he goes long.
Next, he sees price falling and he adds more contracts to average down.
He gets stopped out.
This was a Watch Down, enter UP, stop out Down sequence that had a corresponding watch Dom, enter non Dom ,stop out Dom. The person does not, like DBPhoenix, know dom form non dom in price moves.
Look at the three up downs and consider the pairings of doms and non doms. None of them are alike and this is all unknown to any poster in this thread.
Here is the consequence:
NO ADVICE CAN BE GIVEN TO AN UP/DOWNER BY ANOTHER UP/DOWNER.
Step over the "How to Make Money in Stocks by W. J O'Neill. He has a chapter in that book on the 18 common mistakes made by traders. He explains the mistakes and to not make the mistakes. Do not average down is one of these common mistakes. How did ONeill know the OP was going to be making the mistakes he and the other posters continually make?
He examined why these type traders are feardul, anxious and angry. So did Andrew Lo of MIT.
All of these people have a perfect right to be anxious, fearful and angry: they do not know how the market operates. They think it goes up and down.
In the above pairs, they begin with a long trend and end with a short trend. Each trend completes and there are two trends in three up/downs.
Explaining this to a person who is incoherent and listening to other incoherent persons is a difficult task.
the vast majorityof potential traders go through learning failure over and over and then they quit or their accounts go on empty.
