Trading Strategies Using Technical Analysis

[anuragmunjal]

I think unless the trader is really savvy to what is going on and understand the nature of trends and margin management, adding can be very risky. There are many examples, but I'll name a few:
1. Trader enters the trade, and then it starts to get gains. It pulls back, then he decides to add a position. It continues to pullback, and both positions are stopped out. One ends in a gain, and the other in a loss, and more often than not, they balance each other out.
2. Trader loads up, and position moves in his favor. He's excited, so he loads up some more. Trades go against up him and his account margins out.
3. Trader enters a trade, and he knows he got it right, but the trade goes against him. He loads up some more after it continues to pull against him, and it continues on its contrarian path, and then gets stuck with a horrible loss.
4. Trader adds a position, market goes sideways. Equity is tied up, so he cannot enter other opportunities. I tell followers of my blog if you have to ask about adding to a position, then you are not experienced enough, so don't. It is not to say I condemn adding. I have thrown quite a few extra logs on the fire in my time, but I have the experience and a very conservative lot size on my trades.

hi 4xpipcounter
Imho, It is very difficult to make any serious money in the markets without adding to your profitable trades unless u are scalping or are trading on a very short TF. as a trader one should not look at 'adds' in individual positions...but if a prudent trader keeps a record & adds up all his 'adds', he could then treat it as a separate system and look at the result of this system 'cumulatively'. big money is made in the markets only & only when u have the ability of milking ur profitable trades to the maximum.

regards

 

[SwingKing]

Everything is Documented About...

How to be a good trader.
How to Be Consistent
How to be Disciplined
How to manage money
How to trade the trend
How to analyze fundamentals
Thinking Independently & controlling emotions
Avoiding Psychological trap, Bull trap/Bear trap
Do's & Don't of a good trader
Being an Investor to make wealth
How not to trust news/opinions/pundits/gurus/ "Astrology "

Yet ...

How many who enter this field are profitable and how many still struggle?

Despite of all the Resources in the World, the Path shown to Millions by some Master Traders/Investors, Majority of Traders & Investors always struggle. The ratio of Success/Failure remains consistent and will remain this way no matter what new comes out. Is there something wrong with Humans that they cannot follow simple set of instructions in being successful? Or are the methods/rules etc wrong?

The answer to this, is the answer towards how to be successful. All the Master Traders here know that from inside, yet penning it down is just not possible. Coz that's a journey which every individual has to take and path towards that ultimate goal can never be explained/taught as it is different for everyone.

Just a few thoughts on why being successful in markets has very little* to do with Techniques/MM/Risk Management and more to do with Guts, Self belief and other traits.

If a "Newbie" has to begin, he has to begin by asking this. Else, as Smart_Trade mentioned, he'll never come above the "Strategies Trap" in his lifetime.

Tc

* In the context of what is being mentioned.

 

[krishere]

Well..... you are right..... everything is out-here tons & tons of material.... but everybody has their own capabilities..... not everybody is a great learner..... the human-race had visionaries like Swami Vivekanada when the total numbers of such visionaries would be added, the percentage will not come to even the 10th rounding figure of the total humans who have walked on this world............ Being a great visionary is a v.v.v.rare speciality/Capability.....

So for being a trader....... V.few have the material to be a successful trader......... It is a v.rare talent which v.v.few have..... If you ask a basically highly-emotional person to forget emotions, no matter how many hours of lecture you give him, no matter how many examples you give he will not be able to take out emotion from the trade....... The in-sight lies in, when a person has tried his best and still looses he must give up trading with the understanding that he is not the person for it..... its neither good nor bad nor self-degradatory..... its just a truth.........

Ultimately guts, self-belief, and other traits that you are talking about are also human nature and a type of emotion... which differ from person to person.... and the difference is within..... in the roots......

Phew!! that was intense... and I know I will be flamed for this..... bring it on....

tc
Krishna.

Despite of all the Resources in the World, the Path shown to Millions by some Master Traders/Investors, Majority of Traders & Investors always struggle. The ratio of Success/Failure remains consistent and will remain this way no matter what new comes out. Is there something wrong with Humans that they cannot follow simple set of instructions in being successful? Or are the methods/rules etc wrong?

The answer to this, is the answer towards how to be successful. All the Master Traders here know that from inside, yet penning it down is just not possible. Coz that's a journey which every individual has to take and path towards that ultimate goal can never be explained/taught as it is different for everyone.

Just a few thoughts on why being successful in markets has very little* to do with Techniques/MM/Risk Management and more to do with Guts, Self belief and other traits.

* In the context of what is being mentioned.

 

[SwingKing]

If you ask a basically highly-emotional person to forget emotions, no matter how many hours of lecture you give him, no matter how many examples you give he will not be able to take out emotion from the trade....... The in-sight lies in, when a person has tried his best and still looses he must give up trading with the understanding that he is not the person for it..... its neither good nor bad nor self-degradatory..... its just a truth.........

Krishna.

Krishna,

I really enjoyed reading the highly emotional person's aspect. :lol:

That's so true. Have personally seen this.

On a much serious note, what you have written is right from how you think. There's no right/wrong in markets. Everyone's right as far as they are open to other views.

Tc

 

[praveen taneja]

Thanks for your answer. Have checked it and you have my comment over there. Thanks

DanPickUp

( All my TB are gone for today. Will do it when reloaded )

:rofl::rofl::rofl::rofl: when i read that word really I was shocked but later read again and know what u meant God bless us all

 

[DanPickUp]

:rofl::rofl::rofl::rofl: when i read that word really I was shocked but later read again and know what u meant God bless us all

Hi praveen taneja

Hope you are fine. I am still wondering which one of this TB did you think of ? :lol::lol:

A : Terbium: a metallic element of the rare earth group; used in lasers; occurs in apatite and monazite and xenotime and ytterbite

what would mean, that my laser gun was empty ?

B : Tuberculosis: infection transmitted by inhalation or ingestion of tubercle bacilli and manifested in fever and small lesions (usually in the lungs but in various other parts of the body in acute stages)

what would mean, that you have to go to the doctor today ?

C : Terabit: a unit of information equal to 1000 gigabits or 10^12 (1,000,000,000,000) bits

what would mean, that I have to buy a new hard disk today ?

Have a nice weekend and thanks to spot on TB. Will do it in an clear way next time as I not want to make others feeling ill. :lol:

DanPickUp

 

[S-1585]

Hi S-1585

Now we did this little jump with little risk and now it begins. No we have to swim. No we have to stay with the flow of the market or with the water we are in. We no want to fish out money from this market. If we always talk about how to jump in the market, we never will make money from the market. To jump in is not the problem. To fish out the money is the problem.

DanPickUp

One of the best read.
Also regarding the healthy discussion going on regarding Scale-in / out, it has been also discussed endlessly in many forums, blogs, websites.
DanPickUp's write-up focusses on Managing a Trade once you are in. This means Adding/removing/re-adding/partial profit booking/profit booking. These are the tools with which one could manage trade.

IMHO, if we discuss, "How to Manage" instead of Add or Not-to-Add, discussion would be fruitful.

 

[4xpipcounter]

Let me give a blanket covering to the responses to my previous post. No one has ever accused me of being a "yes" man, and I'm also about to prove it. I have respect for Smartrade and Anuragmunjal, and I disagree with them based on personal experience.

As I mentioned before, I don't necessarily condone the concept of adding to positions, and it was mainly due to the reasons I stated. And I repeat, if you are season and have a firm grasp of the markets, then that is a different story.

I believe it is a stereotype that suggest to not add to your position when the trade is going against you, and again, this is my experience talking. Experience tells me if I know there is a reversal coming, I enter the position. If it goes against me, I wait until that leg is exhausted, and throw another log on the fire. What happens is, let's say the original trade goes against me 80 pips, because that is the length of that leg (My proprietary S&R's measure that kind of thing.). It only need to recover 40 pips for me to break even. Once it is back to the original break even on the trade, I'm 80 pips up, and from there it is double the money.

Personal experience tells me I don't need to add to make a ton of money in trading. I may not add to that previous example. Why? Because, a much better opportunity came along in another pair. I have space allocated to have 6-7 trades up at one time, and it does not matter if they are add-ons or all different pairs. Currently, I have up 6 trades, 5 are winning on 3 pairs and 3 add-ons. There would be no difference if they were all 6 different pairs.

I used to trade when my lot size was torqued up a little more. AMAF, I'm using 1/3 the size what I used to. In those days, I only need 100 pips on one trade to gain 10% equity in my account, with no add-ons. About 200 pips per week was getting me 100% per month. 200 pips is nothing. My current positions are up a composite 340 pips, and the journey is still not through.

Also, if you are planning on adding to the position, then just double your lot size when you enter the trade, and not add to it later. Same margin effect, except even more money without adding to the trade.

Just some personal experiences I'm relating to everyone.

 

[4xpipcounter]

S-1585, I may have upset an apple cart or two in my previous post, but I forgot to cover yours--lol. I know you are new, but it is always in the spirit of respect I share an opposite view.

I never have liked "scaling in and scaling out". If you got a good trade, and it will continue to go in your direction, then why close part of it? If you feel it is going to go against you, then why take out part of it? Close the whole thing, and look for something better. When my 6 trades finish running the gammet, they are history--outa here. I'll be thankful for all the wonderful pips, but I'll be looking for something else. Who knows? I might even reverse direction on what I have up.

BTW, if you are trading successfully doing the scaling in and scaling out model, I am not knocking it. More than anything, I wanted to share by personal experience, the alternate view with the readers.

Okay, it's Saturday morning here. My wife and I are ready to go out on the town.

One of the best read.
Also regarding the healthy discussion going on regarding Scale-in / out, it has been also discussed endlessly in many forums, blogs, websites.
DanPickUp's write-up focusses on Managing a Trade once you are in. This means Adding/removing/re-adding/partial profit booking/profit booking. These are the tools with which one could manage trade.

IMHO, if we discuss, "How to Manage" instead of Add or Not-to-Add, discussion would be fruitful.

 

[yuwathanont]

Re: Swing Trading Nifty and Bank Nifty

thank you very much