overtrading

Are you completely rule based, @deaddog?

That's certainly a long term goal of mine. Ideally, I'd love to add some indicators to my workspace in order to give me more objectivity. Just have not found any I really like, yet. They're either lagging or too noisy/sensitive.
 
Laissez Faire said:
Are you completely rule based, @deaddog?

That's certainly a long term goal of mine. Ideally, I'd love to add some indicators to my workspace in order to give me more objectivity. Just have not found any I really like, yet. They're either lagging or too noisy/sensitive.
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I have a check list of criteria that must be met before I take a trade.
Where I am discretionary is if all the rules are met and I don't like the look of the chart I will pass on the trade.
Keep in mind that I am swing trading equities.
 
deaddog said:
I have a check list of criteria that must be met before I take a trade.
Where I am discretionary is if all the rules are met and I don't like the look of the chart I will pass on the trade.
Keep in mind that I am swing trading equities.
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Could you give an example of those criteria unless it's not a secret?

How's swing trading equities been since the market topped out early last year? Do you short as well?
 
Laissez Faire said:
Could you give an example of those criteria unless it's not a secret?
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Nothing special Typical of a breakout trade.
Here are a few.

Market has to be in an uptrend.

Stock in an uptrend

Stock is at or near new high.

Period of consolidation

Range between swing high and swing low is decreasing

Volume is decreasing

Break out bar is a wide range bar.

Breakout volume is above average.



How's swing trading equities been since the market topped out early last year? Do you short as well?
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I'm a long only trader.
So far this year I'm slightly underperforming the market. I'm sitting on a lot of cash as the market hasn't shown me that it is in an uptrend. Because of that I have been taking relatively small positions and adding if they move in my direction.
 
deaddog said:
Nothing special Typical of a breakout trade.
Here are a few.

Market has to be in an uptrend.

Stock in an uptrend

Stock is at or near new high.

Period of consolidation

Range between swing high and swing low is decreasing

Volume is decreasing

Break out bar is a wide range bar.

Breakout volume is above average.

I'm a long only trader.
So far this year I'm slightly underperforming the market. I'm sitting on a lot of cash as the market hasn't shown me that it is in an uptrend. Because of that I have been taking relatively small positions and adding if they move in my direction.
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Good stuff, @deaddog. Thanks for sharing.
 
eleanorK80 said:
I was wondering that how can I avoid doing too much trading? and What can you do to control yourself when you lose and still want to open another trade? And when you reach your profit goal how can you prevent yourself from thinking of making even more profit?
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Got it figured out, EleanorK80?

 
Businessman said:
You need a well defined plan with clear trading signals.
Then just take every signal you get within your plan with total discipline. Don't just make up trades.

Ofcourse this is all easier said than done. In the real world we end up trading our emotions and feelings and not the market itself.
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I am so glad you mentioned that it is not easy. of course you are right, but can I ask how you describe a defined plan?
 
smallfil said:
This is just my personal risk management approach. I limit myself to 7 open trades total at any given time. When I close out a trade, I have the opportunity to place another trade. Never risk more than 2% per trade. If trades start going your way, move up your stop losses. When you are stopped out, that ends that trade. You will lose monies in the stockmarket and you can lose all 7 trades. That is reality. On the plus side, small losses should not be your concern. It should be the quality of your trades. 7 good trades will beat 20 mediocre or bad trades. And you can make a lot of monies on 7 good trades. This is not static as you replace closed trades with new trades. Do not worry about the profits. Profits will take care of themselves. Focus on the process of trading.
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I enjoyed the idea you mentioned opening 7 trades and changing the stoploss while making profit. i am eager to know what do you mean by profits take care of themselves?
thanks for sharing your great experience.
 
eleanorK80 said:
I enjoyed the idea you mentioned opening 7 trades and changing the stoploss while making profit. i am eager to know what do you mean by profits take care of themselves?
thanks for sharing your great experience.
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Profits take care of themselves because you do not know in advance if your trades will result in big profits, small profits, big losses, small losses. There are only 4 possible outcomes to any stock trade you place. What you need to focus is in your trade process, to make sure you are following your trading plan and risk management rules. Trust the process, like they say. If you have a trading edge (positive expectation), you will make monies after a period of time. And if your trade starts going your way, you want to protect any profits you have already earned by raising and trailing your stop losses. The time to count profits is when you have closed your trades.
 
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