First thanks to Allan at Traders Talk for this blog idea. I think most of the readers at IBC are traders rather than investors and there is a big difference. For a trader to succeed you must have discipline. That means you have to have a strategy and rules. In this post we’ll talk about both.
The 60 minute charts below for RUT & BKX show a great strategy and an easy way to implement rules. In both of these the chartist has identified boxes (channels/ ranges) the indexes are moving in. These channels provide a strategy long or short and also a way to implement stop loss rules that minimize downside risk (stops noted on charts) .
I didn’t note the targets in the charts: -
If short: the target would be the bottom of the respective boxes.
If Long: you would play the breakout with a trailing stop at your buy point for starters. You would move that trailing stop up as the breakout continues to lock in profits as the move starts to fail
6 Responses to Simple Trading Systems –
I see you are getting more aggressive here with a “bra-less” exposition. Will there be a soft-porn version coming soon?
I find it hard to focus on what you have to say when my eyes are looking elsewhere! LOL!
Its a social experiment..
In the words of godaddy.com.. click on my blog to see what happens next
No difference between traders and investors. The difference is there time horizons. No difference in their emotions. That being said, love the chart!
By my definition – Investor is a buy and hold based on a long term belief in the company / product / story etc. and is willing to keep the stock through all cycles unless there is a change to the compnay / story
A trader really not looking at anything other than price action. Time frame could be hours / days or maybe weeks