I am reading the book in Kindle, The new sell and sell short: How to take profits cuts losses, and benefit from price declines by Alexander Elder. I recommend it as a reading and read it fast and get the idea of what a traders mind is like. Is it you? Well what I was surprised about was my trend trading is stressful he says. He thinks short day trades are less stressful. I am going to keep with my trend trading just so you know. I will how ever add more short term trading in between my trend trades.
What the recent events have shown is what ever the markets were doing before hand it will get back to. So in this case buy the big dip !!!!!
I am going in add to my trading plan exit rules.
- If my gain is > 5%, set stop at 50% of greatest gain. An other words be sure to keep 50% of you gain.
- Put in an initial stop of 2% from buy point. This is a normal rule all traders should have.
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