Monday, January 23, 2012


dealing with uncertainty.

1) the only thing i can be certain of - mostly - is how much I will lose on each trade.  Once I give that up  by 'hoping for the best' or 'relying on valuation' -- I will always -- always end up selling for a much bigger loss than intended. 

I also fear losing a small gain and hence rarely make large gains.  The correct strategy is to raise the stops on swings and daytrades.

It is not enough for a stock to stop going down to buy it -- it must be GOING UP.  This means there must be some kind of base pattern or   news/catalyst/volume surge to suggest a sustained move that can generate reasonable profits.

 Confidence comes from following rules.   Losing trades is not a confidence buster ...  not following a strategy is.   Follow charts -- to establish support levels.  These levels are all that matters.  Trading is primarily a psychological game -- not a math game.  Once you give up your psychological edge -- by falling into feelings of fear/regret... you give up everything. 

 Try talking out loud -- establishing what you see from a different part of your brain to avoid allowing emotional trading (fear) take over.   A trade has a clear plan and does not need to be extended (to avoid taking a loser) or ended abruptly (after a quick/small profit).  Let the market dictate the appropriate end of the trade.   You can only control the first loss and the entry.  (

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