Money Management and the Risk of Ruin
I have been getting a lot of comments, questions and emails about money management as of late with the market becoming very volatile. This article will show you the most important mathematics you will need to learn to have good money management in learning how to trade this market.
Risk of Ruin
The Risk of Ruin is [...]
Dollar-Cost Averaging
I was recently reading some article on some very popular finance site whereby the person was talking about the stock market and today’s 376pt crash. They were saying how its not good for buy-and-hold investors, it is good if you are dollar-cost-averaging.
The funny thing about this is this term is totally misunderstood in context, history [...]
Price Action Trading – Strong vs. Weak
Trading Forex is in many aspects the same as trading any other instruments. However, there is one crucial way in which trading Forex is completely different than trading other markets.
When you are trading any other instrument, you are trading a single instrument based upon its individual strength or weakness. However, in Forex you are trading [...]
Using Pivot Points for Reversal Entries
One of the most challenging aspects for traders is finding and entry point into the market, particularly when looking for reversals or rejections. However this is not as complicated as it seems for there is a tool which is exceptional at helping traders find intraday entries for reversals – Pivot Points.
What are Pivot Points?
Originally created [...]
Piercing or Outside Candles
In the current environment with the Euro getting punished across the board against every major currency and likely even the Iraqi Dinar, as traders we want to be taking advantage of these environments by getting short and staying short. However, there are times when the short term moves day traders like to take advantage of [...]
Continue Reading "Piercing or Outside Candles" Comments: Closed | Date Posted: May 6, 2010 - 11:24 AMUsing Rejections + Price Action to Trade Reversals
Using Rejections and Price Action to Confirm your Reversal
Reversals are one of the most common elements in markets traders are wanting to either know of to avoid or confirm their trade. The clues to whether a reversal is in play are hidden in the price action and easily found. These [...]
Why You Cannot Trade Every Inside Bar
In one of our previous articles, we wrote about the inside bar and how it is an important price action formation that can offer great trading opportunities. However it is important to note not all inside bars are created equal.
To Review:
An inside bar is a bar where the entire price action (including the wicks) are [...]
The Breakout-Retest Trade
The Breakout-Retest Trade
Here is a simple price action strategy anyone can trade on almost any time frame.
Its based upon a simple price action formation called the Breakout-Retest formation.
The key element involves price breaking a major high or low with a very impulsive move. The impulsive move suggests commitment from the institutions pushing price and [...]
Effective Trailing Stops
Effective Trailing Stops
One of the most common questions I get from traders is how to trail a trade. There are several solutions and one of them is to have two targets whereby the 1st one gets easily hit and then you move the stop to BE (breakeven) to reduce the risk. However, trades can often [...]
Continue Reading "Effective Trailing Stops" Comments: Closed | Date Posted: March 10, 2010 - 3:49 PMFinding Precise Entries and Exits
One of the most difficult challenges for traders is finding entries and exits. Its an important question that needs to be answered and can determine if you are;
1. getting in at the correct location
2. can have your risk defined and as minimal as possible
3. have a clear location to take profit
4. and know how [...]