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Do’s and Don’ts in Trading

May 25th, 2010
Rules
  • Determine the current force in the market: bullish or bearish? (Line of least resistance)
  • Find support or resistance (moving average, trendline, horizontal lines)
  • Find price action
Beware
  • If previous trend is too strong, never trade counter trend.
  • Watch out for magnets nearby.
  • If a candle largely overlaps with prior candles, it is not a valid signal.

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How to use Amibroker to practice chart reading bar-by-bar (A video guide)

May 16th, 2010

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Beware!!!

May 1st, 2010

When trading, beware of the following traps:

  1. Magnets nearby
    Before initiating a position, check if there’s any other price zone that may attract price to gravitate towards it. For instance, when selling, check if there’s any other resistance nearby. If there is, bulls may attempt to break that resistance, resulting in your position being stopped out at a loss before reversing.
  2. Strength of prior trend
    Never initiate a reversal trade if the prior trend was strong (e.g. Do not sell if 8 out of the previous 10 candles were strong bull candles)
  3. Ignore price action if the candle overlaps with most of its prior candles

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Posted in Featured, Forex Trading, Reading Price Action

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