"risk a little while trying to make a lot" seems like the 3 places where I can do that are trend reversals, dips/rallies & consolidation extremes.
Why is hard to make money? Find trend, stops above previous/high low, TP @ next highs/lows
- Thread starter iamnewuser911
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You should always aim to lose less compared to winnings. My criteria is x3.
Successful trading in the markets is like counting cards in black jack. IOW... bide your time until you believe the odds favor your play, then get your money out.
Yes sir.
One more question, when is it a bad time to "chase longs" or too late to enter in an uptrend?
May I ask about your win rate and Risk:Reward? What kind of stats would you be aiming for?
Chasing "too late" is hazardous. Exactly when it's too late is hard to define. However, chasing late is chasing momentum. It had better continue or you've got yourself into a trap. I think the best time to chase is just after a break of support/resistance. Anything beyond that is up to the gods.
I don't track win rate any longer. I once had a 5-year win rate of 70% and even went into July one year before I got my first loser. But those were just fortunate streaks. You shouldn't expect a high win rate. 55-60% is excellent... especially when you use stops to control the downside. And of course you can be successful with a 35-40% win rate if your gainers are significantly bigger than your losers.
For trading the ES, I look for opportunities to risk 4 points where I think I might make 12.
As for other vehicles, I like to play for the "swing". That might be risking 2% for a chance to make 8-12% or more depending upon the sector*. Big move sectors are gold, oil, biotech and others.
*Each security/sector has a "normal noise oscillation range". I try to play for a significant piece of that.
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Wow, that's really good stats. I am in spot Forex.
How does one know momentum has died off or is unlikely to continue in a trend on the chart? Divergence? Weakening impulse waves?
https://www.tradingview.com/x/tb7aGDOD/
I was short that retracement in hopes of downtrend continuation however stopped out, only risked a little. What else do you see that I wouldn't that would have not made you take the trade?
That's part of the "art" in trading.
By the time you "know for sure", the horse is already out of the barn.
So all I can do and my job is to control risk, sounds about right.
There are 4 possibilities on a trade.
1. Small gain
2. Small loss
3. Big gain
4. Big loss
The only one you can control is Big Loss... to be avoided at all costs.
Nice, do you believe in "Control risk and the money will come in." then? Or absolute bollocks without an edge? For now I'm just playing rallies and dips in a trend and some trend reversals with small risk.