Thanks to all DTI students who have enhanced my education in the markets over the years. Finally, special thanks to Kevin Commins and all the folks at John Wiley & Sons for giving me the opportunity to publish this book.
Introduction
Great effort has been made to ensure that the information presented in this book is correct and accurate. In fact, I hope that your trading will be more enjoyable and profitable as a result of the information and ideas presented.
The Crucible
Even in the depths of my despair there was no time for pity or resignation. I was one of the biggest producers in the office and actually in the region.
Time Is Central
So how do you know if you should be long, short or out of the market. IN THE TIME OF THE DAY. cases, they don't want to stay in the market overnight.
Trading Is a Numbers Game
This will help you see the pace of the market and keep up with it. I refer to these numbers and use them as gauges to gauge market activity as the day's trading progresses.
USE KEY NUMBERS TO TRADE
Because key numbers are support and resistance points in the market, I use them in several ways. Review the example of that method in the previous section on the key numbers in the S&P Futures Index.
Read the Tape
I will also be more cautious about going short if I know the market's dance is bullish. The market is simply too difficult to read at some times of the day and it is too easy to lose money.
There’s No Crying in Trading
When the market is going your way, it's all too easy to get greedy. Being on the wrong side of the market in the example above would result in a loss of $5,000.00. Fear can also be so debilitating that it can turn you off the market altogether.
It was the single worst day of my life because I was at the mercy of the market. Do not hold your positions until the market moves against you and your profits are gone. Trading is intense and it's very easy to get mesmerized by the market.
Riding the Rail
You want to pick a time when the market is moving so that you will be able to liquidate a portion of your position very quickly. If the timing is right and the market is ready to move, you can also be out of the second part of your positions within minutes. If you are long and you know that the market is approaching a strong resistance level, you probably want to lighten your positions and take profits.
You want all your money safely out of the market and you want to be an observer. The trick is to read and understand the market so you can change with it. Do not enter the market unless you know where you will make a profit and where you will place protective stops.
Worry about Risk, the Rewards
Will Come
Over the years I have learned what to expect from the market and I don't like surprises. Sometimes it is impossible to determine what the market will do next. If my protective stop is hit, I think the market is telling me I'm wrong.
When the first tower was hit, the market reacted negatively and my protective stop cautiously took me out of the market. Once a protective stop is placed, adjust it as the market moves in your favor as well. By taking some quick profits, I have managed to take some money out of the market to cover the downside of my trade.
Respect the News
However, although I believed I was on the right side of the market, I used protective stops just in case the market disagreed with my analysis. If you are a beginner, I strongly suggest that you stay out of the market when the Fed reports. If you are on the wrong side of the move, you will pay a heavy price.
Don't make the mistake of being in the market without a protective stop when the numbers are released. My general policy is that it is best to be out of the market when scheduled economic reports are published. Because some of these reports are big drivers of the markets, you don't want to be caught on the wrong side of an avalanche.
Getting Down to Brass Tacks
If we are currently trading below the annual open, the + sign goes on the short side of the T. I assess which index is moving the strongest in the direction of the market and I allocate my money accordingly. If the market goes in my favor, I estimate at the beginning of the second quarter.
7. At the end of the third quarter, I'll shut down the worst-performing of my remaining three funds and use my remaining funds through the end of the year. More specifically, how does it line up with the S&P at certain times of the day and year. I don't want to make a trade until the share price exceeds these points.
Preparation Pays
They do not understand the complexity of the market and the many skills required to be successful in the long term. Just make sure you make these trades in the context of the big picture. It is difficult to make the last choice, i.e. to stay out of the market.
A successful trader must know where the market has been, but trading in the present is essential if you want to win. If so, you should have heard the news and been out of the market before it broke. Without the big picture of the market in mind, you will not be a very successful trader.
A Study in Contrast
I take my shorts in the S&P 500 Index to the market and go to the long side. I don't want to take the extra risk of staying in the market and going for big profits. That is, I want to get enough quick profits out of the market to be able to hold a small position.
I work with the market's money and I can relax and enjoy playing the game. Generally, if I'm not in the market 15 minutes after the hour, I wait for the next 30 minutes of reading. Every time I got on the elevator when the market was going on, I was tense and worried.
Recap the Essentials
There are other times when a wise trader will usually stay out of the market and be an observer. When the market opens each day, I keep this big picture in mind to help me stay on the right side of the market. I identify key numbers that are closest to where the market is currently trading.
Study the market before entering it and identify the point where you are sure you are wrong. There is one big market question you should always answer before clicking the mouse and executing a trade: should I be long, short, or out of the market. It is true that if a dramatic and sudden market reversal occurs, your stop may be passed and you may not be taken out of the market.
An Afterthought for Consideration
The man sees the value of the product and believes the world will embrace it. In fact, you don't have to be right all the time to be a very successful trader. When the day begins, a good dealer is ready and has recorded all the necessary data.
They're just not used to a lot of the trial and error stuff that the rest of us have mastered. They consist of S&P futures, Nasdaq futures, TTICK (an indicator I designed) and DAX futures. It is a very important foreign market and I count it among the four big ones.
Glossary
The value of an S&P Futures contract depends on the current market value of the S&P Money Index. Likewise, the value of a stock option depends on the value of the stock on which it is based. If the strike price is not hit, the option is out of the money and expires worthless on the expiration date.
In the case of a futures contract, the trader can lose more than the value of the entire trading account. TTICK A proprietary indicator created by Tom Busby that combines the price action of S&P futures and the TICK (New York Stock Exchange Indicator) to help determine market strength/weakness. If a trader loses the amount of the tilt number in a trade, he or she must exit the trade.
Getting Started
Do you have the education and knowledge you need or can you acquire the necessary knowledge. After you decide what you will trade, immerse yourself in it and learn everything you can. And of course, make sure you open the type of account you need to trade the vehicle of your choice.
When you have different markets that you are monitoring and charts that you are observing, it is practical to have at least two monitors. Be sure that you are familiar with the process and that you are able to get in and out of the market very quickly. Therefore, it is very important that you learn everything you can about order placement and practice the process before you ever start trading.
Order Types
Orders allow traders to do two things: enter the market and exit the market. What happens if you make a mistake and electronically submit a sell limit order below the point where the market trades. The same thing happens if you place a buy limit order above the price where it is being traded.
The order becomes a market order and immediately takes you to the market at the current price. You move your cursor to the trading dome and click below the point where the market is currently trading. A stop order is an order that becomes a market order when the market price of the underlying instrument reaches or exceeds the specified price.
