Have started to be serious about trading a few months ago and learning all I can. I have been reading on technical analysis by Robert Edwards and Magee, and I've been drinking from the firehose that is youtube etc. I am not looking to day-trade, but rather hold options for a few days or weeks. My base assumption is that news influences price and I can't predict that really well, but I would think that TA gives me some form of edge. Knowing full well I'm completely new to this, I would assume my readings of the charts have any value, but I'm somewhat disappointed to find that I actually seem to be more wrong than right. I would have guessed it would be a toss-up at the worst. I use Ichimoku, trade with the trade (so calls if it is above the cloud), wait for pullbacks to the mean, believe I understand resistance or support from Williams fractals and use RSI or a stochastic to confirm. I realize this is pretty much the most basic thing to do, but one has to start somewhere. Still, as soon as I start a trade (I even put in my journal words like: "wow, this can't go wrong") the market immediately proves me wrong I'm not asking for anyone's setup, I understand that it is my journey to find my own edge and trading style. Questions: - Is there some de-facto beginner resources that I should be aware off that should get me started? I'm reading books, but most seem to be written for the world of the 70's. - If the market is fickle, should I not still be at around 50%? - How long did it take you to start making sense of it all? thank you kindly!
Are your stops too tight? Also you can be right less than 50% of the time as long as your winners are much larger than your losers.
Get back to basics. TA is a great basis for trading, but only in so far as it tells you clearly what the big money has been doing - buying or selling. An uptrend indicates the big boys have been buying, a downtrend indicates they have been selling. If they have been buying enthusiastically, they're probably going to continue. Trends tend to continue. Recognise trends. Define a good trend and a bad trend so you can grade them. Follow them. Get out when they downgrade.
fair - no, I don't think my stops are too tight. Quite the opposite, to be fair. I sometimes reconsider the trade and when I feel it is just the pullback working against me, I'll let it go farther than most people probably. I'll experiment with more strict stops in a few weeks. Commissions I'm not yet worried about (although tos is not cheap). I mean the actual stock is going against my expectations.
Edwards and Magee’s Book is a classic and a good start. The other is Trading and Exchanges by L Harris. Human emotions haven’t changed during the evolution of the markets, reading older material that is still applicable today will verify that fact. Right now, it’s more about building a baseline of reference as you continue to develop your discernment. At some point, there is a fork in the road ahead of you. One path is grounded in induction the other is grounded in deduction. One’s more about memorizing the other more about ‘thinking.’ One will be the majority view and the other the minority. Your pace of mastery is independent from anyone else’s and just diverts your focus from purposeful learning. Negative naysayers should promptly be put on ignore. They are dream stealers and have a ‘crabs in a bucket’ mentality. Good fortune to you!
Go to You Tube and watch the videos on trading. Take notes. After a while, you should be able to figure what you are doing wrong and correct it. Placing trades is easy, the mental part of it is what is hard.
Honestly speaking learning from books, from coaches (who are not full time traders) can cause more harm then benefit. It took me many years to unlearn from those books and coaches. I was fortunate to learn (just a little ) from a coach who was a successful full time trader. No one can teach you trading because trading is an art, not science. Those who are successful wouldn't teach. really no short cut. have to develop your own holy grail. If the market is fickle, should I not still be at around 50%? Sometimes market is very organised. it moves smoothly and as planned. its movement is not too fast, not too slow. very easy to earn money from such market. Sometimes market is very jerky very spiky. learn to recognise such market and avoid trading it. eg those who day traded Nasdaq NQ during yesterday US session would probably find trading very very difficult. And those who day traded Nasdaq during yesterday European session would find trading very very easy.
I agree for 100% with that. I never read any books or listened to any coach, so my brain was not polluted with (what was to me) garbage. But I had to change the way my brain was working to be profitable. I had to unlearn automatical and/or subconscious reactions that my brain generated, and replace it with a new way of thinking. Took me a long time. Exactly. When I see pictures from trading stations I always wonder how they can trade on what they see on these screens. My screens look completely different.
Lucky you. You didn't read books nor listened to any coaches and your mind is free from contamination. I can still remember all the garbages, nonsense, stupid things my coaches taught me. Took me YEARS to decontaminte my mind. But honesly speaking if I need to sell fridge to the Eskimo, I will attend those classes again.