Originally posted by ProTrader1
Brother Candle, please forgive another question, but you mentioned that you like to scalp, and that you have a 3:1 ratio. Is that 3 winning trades for every losing trade, or, in other words, a 75% win rate? OR, is that each winning trade gives 3X the $$$ of each losing trade?
I ask only to establish an excellent standard to aspire to.
Also, would you be so kind as to outline your your approach to these scalps? What are your first thoughts when you begin to scalp? How do you conceptualize a successful scalp?
Thank you, dear brother, in advance for your time and tireless contributions to others. You are an inspiration to many of us.
Your Brother,
Protrader1
"Trade the trend with discipline and let probability sort out your p&l."
Candletrader
Dearest Brother Protrader,
I am flattered by your comments, which make me feel but prouder to share that inviolable bond between us of brotherly rapport through thick and thin, through the good times and through the times of adversity.
I will now render you my response, which I trust you will find befitting of a Brother, for without Brotherly spirit we are merely lonely wanderers traversing a void akin to an isolated desert of trading ignorance.
I attempt 3:1 with respect to the coupled phenomena of risk and reward. If I purport to lose a maximum of $500 in the course of a share transaction (be it of the long or of the short variety), then I feel it is only right only and proper to extract from Mother Market a reward of $1500, in return for my dedication to the trading game. In pursuing this endeavor, I seek to identify a situation whereby the odds are in my favor. An immediate consideration is the trend operative within the time framework that I have deemed appropriate for my scalping enterprise.
Thereafter, I will look for signs of interest and for Mother Market to have her sails blowing in the same direction as my potential speculation.
Given that the aforementioned parameters are in place, the rest of the trade consists of gut feel, since I am a discretionary trader. Of course, a systematic trader may argue that this is an incorrect approach. My contention would be that gut feel may constitute the subconcious synthesis of a systematic approach, garnered over many years of trading experience.
With love, understanding and compassion for you, my dearest of Brothers,
Candle