Here's my short list but again, I do see trading getting tough these next few weeks. Progressive exposure means you take on trades progressively, let's say 20% of your total account to start and only move up in total positions if your trades are working. Stops will be tighter as positions move to green as well. AVOID LARGE DRAWDOWNS ON YOUR CAPITAL ON PULLBACKS!
Also, when things get extended, I don't like to enter positions that have me risk more than 6% using technical analysis.
Lew - with the market being down the last couple of days, do you feel that now is even a better time to invest in the stocks you mention above (eg KMI or others)? [Reply]
Originally Posted by Peter Gibbons:
Lew - with the market being down the last couple of days, do you feel that now is even a better time to invest in the stocks you mention above (eg KMI or others)?
Absolutely not. Traders should only trade with market momentum. I enter positions on up swings.
Many of those positions I listed would have been stopped out the past few days and I mentioned the market being very over-extended so progressive exposure is key. You don't go from cash to 100% invested when trading. I start with 20% exposure, see if my trades are working and increase from there. I retreat to cash and find more setups I like, re-enter when they confirm upward movement and manage risk with each trade, NEVER averaging down because that's just guessing without protecting your capital. There's absolutely days when the market is red and setups aren't confirming that I just sit on my hands.
Remember, these are trades. If I am looking for long positions I go by fundamentals and will buy on dips on occasion, but these posts are not that. [Reply]
Originally Posted by lewdog:
Absolutely not. Traders should only trade with market momentum. I enter positions on up swings.
Many of those positions I listed would have been stopped out the past few days and I mentioned the market being very over-extended so progressive exposure is key. You don't go from cash to 100% invested when trading. I start with 20% exposure, see if my trades are working and increase from there. I retreat to cash and find more setups I like, re-enter when they confirm upward movement and manage risk with each trade, NEVER averaging down because that's just guessing without protecting your capital. There's absolutely days when the market is red and setups aren't confirming that I just sit on my hands.
Remember, these are trades. If I am looking for long positions I go by fundamentals and will buy on dips on occasion, but these posts are not that.
Your explanation makes perfect sense. Thanks for coaching me up - much appreciated! [Reply]