From time to time, it will feel like nothing is working.
How to get out of the trading slump?
To be written...
Tuesday, September 20, 2011
Monday, September 19, 2011
Play good defense or good offense?
In trading, just like sports, one question keep coming to us is, shall we play good defense or good offense?
No easy answer. To be written....
No easy answer. To be written....
Friday, September 16, 2011
How to stay flexible and unbiased?
I have been always facing the challenge to deal with bias due to existing positions or previous trades.
Recently I had homerun on short swing, so in recent week I tend to hold short longer, turning profit into loss because I was right on 5min timeframe but wrong on 30min timeframe.
Bias due to recent trades or existing positions are very common, at least to me. The moment I become all cash, my mind immediately turn to much sharper mode and can read the market flow much more clear. And I can start to hit orders with better execution.
A lot to learn as always...
Recently I had homerun on short swing, so in recent week I tend to hold short longer, turning profit into loss because I was right on 5min timeframe but wrong on 30min timeframe.
Bias due to recent trades or existing positions are very common, at least to me. The moment I become all cash, my mind immediately turn to much sharper mode and can read the market flow much more clear. And I can start to hit orders with better execution.
A lot to learn as always...
Thursday, September 15, 2011
Risk tied to individual stocks
UA had a takeover rumor by Nike, which is denied this morning.
But looking back, this is substantial risk to hold individual shorts (or longs) overnight.
Wednesday, September 14, 2011
Market in massive range mode for DT
By looking at the market and reactions in all sectors, market is in massive range mode.
DT and short term trading are best approach at this point.
It is hard to believe retailer stocks such as FOSL UA would come back to range top. short ruthlessly again...
(update after market close: today totally wrong about the market direction. covered with loss in the middle of day)
DT and short term trading are best approach at this point.
It is hard to believe retailer stocks such as FOSL UA would come back to range top. short ruthlessly again...
(update after market close: today totally wrong about the market direction. covered with loss in the middle of day)
Tuesday, September 13, 2011
Shall we feel safe?
Merkel bids to quash Greece default talk is today's headline.
But is it trustworthy? EUR AUD GBP are in break down mode again realtime.
Looking at the whole landscape of market, a lot of momentum stocks and leading stocks are not showing much fear AT ALL.
Either this is still a good bull market... Or, it is much worse, the market has NOT materialize the fear yet.
My experience tells me, even in bear market, LONG stocks can still be very profitable, but you have to watch out for sudden and fierce downtrend. Usually those are:
1. Gap down caused by EUROPE
2. Open Hour Drive Down
3. Afternoon Drive Down
It is easy to understand. They are gap and two volatile intraday sessions. Learning to escape from sudden bearish moves, then 80% of time you are safe.
But is it trustworthy? EUR AUD GBP are in break down mode again realtime.
Looking at the whole landscape of market, a lot of momentum stocks and leading stocks are not showing much fear AT ALL.
Either this is still a good bull market... Or, it is much worse, the market has NOT materialize the fear yet.
My experience tells me, even in bear market, LONG stocks can still be very profitable, but you have to watch out for sudden and fierce downtrend. Usually those are:
1. Gap down caused by EUROPE
2. Open Hour Drive Down
3. Afternoon Drive Down
It is easy to understand. They are gap and two volatile intraday sessions. Learning to escape from sudden bearish moves, then 80% of time you are safe.
Keep it Simple ?
My friends all know I am very verbose. :). It does not necessarily mean I am confused though.
I name everything with a nickname. For every thought we encounter in trading, I try to find similar example in real life.
For all these I do, I seek simplicity.
All my setup sums into follow categories:
1. Trend Following
2. Range Fade
3. Range Break (start of a trend)
4. Market delay (I've talked in previous blogs)
Sounds easy, isn't it?
Reality sucks. The most difficult thing is how to distinguish between trend and range , and detect the potential transition between them. Pretty much all my trading techniques are around this central topic.
In range market, you deploy totally different mechanism that you will be using in trending market.
The only way you can keep things simple is to dig out all the complexities first, in my humble opinion.
I name everything with a nickname. For every thought we encounter in trading, I try to find similar example in real life.
For all these I do, I seek simplicity.
All my setup sums into follow categories:
1. Trend Following
2. Range Fade
3. Range Break (start of a trend)
4. Market delay (I've talked in previous blogs)
Sounds easy, isn't it?
Reality sucks. The most difficult thing is how to distinguish between trend and range , and detect the potential transition between them. Pretty much all my trading techniques are around this central topic.
In range market, you deploy totally different mechanism that you will be using in trending market.
The only way you can keep things simple is to dig out all the complexities first, in my humble opinion.
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