I share your belief that there is intelligence in Trader Planet Land. Otherwise, I really would be the dope that my wife says that I am :-). Having been trading for just over one year, I am just now in the process of getting off the indicator roundabout. I am still having troubles with dealing with exits from trading ranges. I’ve read lots of advice as to how this is best done but I still can’t get it right. If I ignore the first breakout as being probably false, it isn’t, and if I take the breakout it always almost proves to be false. Any advice would be most welcome.
Best wishes and thanks for your column.
I don’t know if your wife is right, but your writing speaks to “not a dope.”
Day trading the “break out” is tough, to say the least. It is all about timing and making decisions. Do you know your market and can you make the call when you need to. In fact, it is an art, in my opinion, as once you learn the mechanics of it and then gather experience doing it, you inevitably turn to your “instinct” or “intuition” to make the call. Like poker, sometimes making the right call is about your “sense of the moment.” This makes winning at poker an art, just as trading breakouts is an art. Any artist will tell you, however, that to be good at your art, you must understand every aspect of your craft. Consider the quote below …
If I buy a breakout or sell a breakdown, I will make money, right? If you believe this statement, immediately contact your broker, withdraw your funds and put them in a savings account. If you follow this system, you will lose money. Often times, professional floor traders and the like will wait for stocks to break new lows, look for large buy orders in the tape, and then start scooping up every share in sight. This will leave you, the novice trader, looking at your screen scratching your head, asking yourself the question, how did this happen?
My advice to you is learn the craft, which means go out and read everything you can about the craft of trading breakouts, and then practice, practice, practice. I normally don’t do this, but I recommend you start at the following web site, since I used a quote from the site.
http://www.mysmp.com/day-trading/day-trading-breakouts.html
Trade in the day; invest in your life …
