2008-12-14 11:12
A hard stop is an order you place in the market. A soft stop is the number you keep in your mind, prepared to act as soon as the market reaches that level. The distinction between them is ex… Read More
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Stock Market Trading Education Blog
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Stock market trading education course. Technical stock trading information, strategies and tips. Technical analysis of buy and sell stocks.
2008-12-10 12:15
All orders can be divided into two broad groups—market and limit orders. A market order is filled at what brokers like to call the best price—but what is in fact any price and of… Read More
2008-12-10 12:13
The main purpose of using a stop is to protect yourself from an adverse move by limiting the loss on a trade to a predetermined amount. The secondary purpose is to protect paper profits. Wit… Read More
2008-12-10 12:09
If you compare buying a stock to getting married, using a stop is like signing a prenuptial agreement. If your happy relationship hits the rocks, the prenup will not take away the pain, but… Read More
2008-12-09 09:24
Moving averages can provide targets for rallies from deeply oversold levels. Channels or envelopes can provide targets for short-term traders. These tools help catch short-term swings—… Read More
2008-12-09 07:34
What if you set a profit target for your trade at the envelope but later come to believe that the rally has even greater potential? How much longer can you hold? Experience has taught me tha… Read More
2008-12-06 20:04
When it comes to dealing with the good things in life, the majority of people always want more—a bigger house, a shinier car, perhaps even a newer and better spouse. I remember being s… Read More
2008-12-04 20:43
We have seen how moving averages on the weekly and daily charts present good profit targets for the rallies that jump off the bear market lows. Later, after a bullish trend has established i… Read More
2008-12-02 14:12
Robert Rhea, a prominent market technician during the first half of the twentieth century, described the three stages of a bull market. During the first stage, prices recover from the overso… Read More
2008-12-01 17:18
You buy a stock when you expect it to rise. If you thought you could get it cheaper, you would have waited to buy it at a lower price later.Once you select a buy candidate, you need to ask s… Read More
2008-12-01 17:14
Whenever you plan to buy a stock, ask yourself whether you plan to own it for the rest of your life and leave it to your heirs. Since the most likely answer is “no,” the next que… Read More
2008-12-01 17:12
We have discussed how to buy, manage risk, and keep records. It will take a lot of work to implement these lessons—but this is exactly the kind of work that will put you ahead of the m… Read More
2008-11-30 11:24
I once heard a phrase that stayed with me for years—a man who owned a flower shop said that he had to “buy well to sell well.” Flowers have to be sold quickly, before they… Read More
2008-11-28 13:48
The goal of trading is to make money, but can you use money to measure the quality of every single trade? I believe that the amount of profit or loss provides only a very crude measurement o… Read More
2008-11-28 13:47
The two most basic ratings for every trade are the buy and sell grades, which measure the quality of your buying and selling. Tracking them will help you increase your level of competence in… Read More
2008-11-28 13:23
A person who trades without measuring and grading his performance is like someone who calls himself a competitive runner but does not own a stopwatch. Only a recreational runner can jog arou… Read More
2008-11-28 13:20
I learned this method for implementing trading plans from an old friend who came to teach at one of our Traders’ Camps. Fred Schutzman is a CTA (commodity trading advisor), and even th… Read More
2008-11-27 11:49
In addition to the fairly high-tech diary we just reviewed, I want to give you a low-tech method for keeping track of planned trades.You may look at a chart and see a beautiful trade startin… Read More
2008-11-27 11:46
People who like to explore and learn always make mistakes. Curious and intelligent people inevitably make errors. Someone who never makes a mistake is a narrow-minded individual who stays in… Read More
2008-11-27 11:45
I believe that the best format for creating a trading plan is similar to the Diary we have just reviewed. When you scan a large number of stocks, you can keep brief notes on the potentially… Read More
2008-11-25 08:50
Whenever I talk with traders, it amazes me how few people maintain records of their trades in spreadsheets. Many rely on their brokers, but while your brokerage house is probably very accura… Read More
2006-06-07 11:16
The planned duration of your trade helps determine how far from the entry to place your stop. As a rule, a shorter time horizon calls for tighter stops, while a longer timeframe tends to req… Read More
2006-06-07 11:16
In a Traders’ Camp in 2003 I met a trader by the name of Nic Grove. His story, with its colorful personal details, is in some way typical of how people come to trading. As a young man… Read More
2006-06-07 11:16
Most traders do not use stops. The fact that you are thinking about them and reading this book is a positive sign. Stops improve your chances of rising above the crowd.Looking at most charts… Read More
2006-06-07 11:16
Among the many misconceptions about stops one stands out as the worst. It has cost investors and traders billions of dollars and will, undoubtedly, cost them more. This misconception is that… Read More
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