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"...but never risking more than 2-3% of their capital on any trade"

Brandon,

Could you clarify this? This may be a stupid question, but I am wondering what you really mean here? Do you mean:

1) If your total capital as a trader is $100K, no single trade should be greater than $2K?

OR

2) Once you're in the trade, never allow the price to fall more than 2-3% lower than your entry point?

OR

3) Once you're in the trade, never allow the price to fall more than 2-3% of your total capital?

OR

4) Something else?

Thanks
 
Quote from StockSniper:

"...but never risking more than 2-3% of their capital on any trade"

Brandon,

Could you clarify this? This may be a stupid question, but I am wondering what you really mean here? Do you mean:

1) If your total capital as a trader is $100K, no single trade should be greater than $2K?

OR

2) Once you're in the trade, never allow the price to fall more than 2-3% lower than your entry point?

OR

3) Once you're in the trade, never allow the price to fall more than 2-3% of your total capital?

OR

4) Something else?

Thanks
More...


3. For example, if you have a $50,000 account and are risking 1% on a trade you would not want any trade to cost you more than $500. If your stop was $1.00, then you would trade 500 shares.

Brandon
 
MINOR SUPPORT: Minor support is the general price area at the peak of a previous rally in an uptrend.

MINOR RESISTANCE: Minor resistance is the general price area of the bottom of the last selloff in a downtrend.

Brandon
 
MOVING AVERAGES
Moving averages tend to serve as great levels of support in the context of an uptrend. For the purposes of my trading I use the rising 10 day, 20 day and 50 day simple moving averages. Strong up-trending stocks tend to bounce off of rising moving averages. When we see bull flag, and the pull-back has brought the stock back to a rising moving average this greatly increases the accuracy of the setup. Should this moving average also occur at an area of minor price support, as previous discussed, the odds are even better.

Brandon
 
Quote from Brandonf:

MINOR SUPPORT: Minor support is the general price area at the peak of a previous rally in an uptrend.

MINOR RESISTANCE: Minor resistance is the general price area of the bottom of the last selloff in a downtrend.

Brandon
More...

These statements can be read in several different ways and are confusing. Please could you explain what you mean...

For example, from the peak of the previous rally, the price will definition have pulled back other wise it would not be the peak. At this point, until you pass this price again and are on the way to forming a new high in the trend, you would be below the price area at the previous peak and by definition the price at the peak would be resistance and not support. Howver having move on upwards through that area again and on the way to forming a new peak area, that previous peak would now become an area of support...

Natalie
 
Quote from Girlpower:



These statements can be read in several different ways and are confusing. Please could you explain what you mean...

For example, from the peak of the previous rally, the price will definition have pulled back other wise it would not be the peak. At this point, until you pass this price again and are on the way to forming a new high in the trend, you would be below the price area at the previous peak and by definition the price at the peak would be resistance and not support. Howver having move on upwards through that area again and on the way to forming a new peak area, that previous peak would now become an area of support...

Natalie
More...

Ill try it with a picture. Hopefully this will be a better way to explain.

trendsr.gif


Brandon
 
News can provide one of the best opportunities for traders. It can also be very dangerous if you do not know how to deal it. I personally do not buy good news, or sell bad news. I look to buy bad news and sell good news. This is based on the premise that if something is supposed to go up, but it goes down people will get scared, causing it to go down even more. If something is supposed to go down, but goes up the short sellers get scared and this can cause it to move up nicely.
The BUY SETUP

1) Bad news comes out in a stock, this can be earnings, warnings, downgrades ect.
2) The stock gaps down below the low of the prior day.
3) I set two alarms. The first is setup 15 cents above the low of the prior day. If this price is violated I will look to enter on the long side. The second is placed right above the 30 minute high if this is lower than the prior days low. If this price target is hit I will enter partial lots.
4) I place my stop 20 cents below the low at the time the setup occurs.

THE SHORT SETUP

1) Good news comes out in a stock. Again this can be earnings, upgrades, new products etc.
2) The stock gaps up above the prior days high.
3) I will set two alarms. The first is set 15 cents below the high of the prior day. If this price is violated I will look to enter a short. The second is placed right below the 30 minute low. If this price is broken to the downside I will enter partial lots.
4) I place my stop 20 centsabove the high of the day at the time the setup occurs.
 
Quote from Brandonf:



Ill try it with a picture. Hopefully this will be a better way to explain.

trendsr.gif


Brandon
More...

Right Agreed. - That is a standard picture. So the statements you made (that I commented on) should really be removed from the thread because they were only correct under certain circumstances. And your picture should remain in its place. It reinforces the point I made.

Thanks for clariying it - wouldn't want folks to get it the wrong way round :)

Natalie
 
This thread is titled "Back to Basics". Off topic discussions will be deleted. Discussions of the advertiser policy in this thread are off topic and thus will be deleted. Out of deference to fellow ET members, please keep posts on topic. - Thanks
 
Quote from TriPack:

This thread is titled "Back to Basics". Off topic discussions will be deleted. Discussions of the advertiser policy in this thread are off topic and thus will be deleted. Out of deference to fellow ET members, please keep posts on topic. - Thanks
More...

Go TriPack :p

(you may delete this now)
 
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