I took off a losing Dow Jones stock index trade yesterday.
That’s not a big deal. After all, you win some, you lose some.
Maybe I should say, I FINALLY took off a losing trade. It’s one of those things. You learn something. You know it. You even teach it to others. And sometimes, you let your discipline slacken and don’t do it yourself!
We’re all prone to this which is why we must maintain our discipline when doing online trading. The financial markets are not forgiving.
So what did I do? Well, the market opened yesterday morning a little outside of my stop-loss level but it was just drifting (this was an options trade so it’s not so easy to enter the stop at the time of the trade). I told myself that I would let it drift a little more in my favour and then take the trade off.
But you know what? A stop is a stop. If you’re wrong, you’re wrong. And what you invariably find if you play this sort of game is that you lose more than you ever win.
So it was yesterday. When I finally took the trade off, the loss was substantially larger than it needed to be.
Now, it’s no big disaster because it was a really small trade size. However, it is the principle that counts. I don’t think we should ever tell ourselves that we can “afford” a trade, i.e. the present loss level. If you do, you find that all too often, it will get to a point when it really DOES hurt!
Besides, if you play this game, when ARE you ever wrong on a trade? After all, if the market were to then improve in my favour, and maybe even go all the way back to breakeven, isn’t that less reason to take the trade off?
No, the answer is always to know your stop, i.e. when you are definitely wrong, and exit once it is hit or passed.
I shall make sure that I never make this mistake again. How about you?…
Asoka Selvarajah
I just wanted to pop in to wish you a very Happy New Year. May
your Trading success really skyrocket in 2010. I really wish
this for you, no matter how well or badly it has gone last year.
You know, the start of the year is a great time to review the past
year to be honest with yourself as to how well it really went. It
is also the time to take the big-picture view of what's ahead.
I would suggest that you take some time out, if you haven't
already, and really plan out 2010 in detail. Review your
strategies. Find out what has worked for you and what hasn't.
If nothing worked last year, then sit down and start afresh to
brainstorm what is going wrong. What do you need to do? What
resources do you have to access? (Not just in Trading but in ALL
areas of your life – business and personal).
The fact is that you are DEFINITELY capable of being a good
trader. OK? The only question is, what is holding you back? Is it
your lack of self-belief? Is it lack of a winning strategy? Is it
that you over-trade and take too many poor opportunities?
This is a great time to really sit down and THINK. Take a blank
piece of paper and a pen… and just THINK. Plan. Strategize.
Plus to help you to do that, don't forget that I am running an
extremely rare once-only teleseminar where I answer YOUR most
pressing Trading challenge or concern.
You can ask your question here:
===> http://www.onlinetradingrebel.com/Make2010Great <===
I've had some great questions already and it's looking to be a
really good call. The only way you're going to get your question
answered for sure is if you get it in before I'm overloaded.
If I have the answer, I want you to benefit from it. This could
make the difference between 2010 being your best Trading year, or
just another year of so-so performance.
So head over and let me know what you want me to help you with:
===> http://www.onlinetradingrebel.com/Make2010Great <===
And once again, I wish you the very best for 2010. May the markets
send you lots of cash! And may it be EASY for you! 
After the huge rally in recent days, the Dow Jones is hitting resistance coming in from two Gann-type resistance levels generated from two previous intermediate lows over the current move from the March 6th bottom. Also, next Thursday 4th June is a major cycle point, being 90 Calendar days from that March 6th low.
Hence, my best guess is that if the Dow is still trading at these major resistance levels, i.e. 8670 – 8765, next Thursday, then it will probably top here and make a major selloff. Of course, cycle points can also be times when strong accelerations in the existing direction take place. Hence, if the recent highs are taken out strongly, then expect a fast move upward which would target the 9,000 level next and quite possibly much more besides.
However, my bias as to how this cycle will play out is to the downside for now.
Asoka Selvarajah
Mike Butler takes the reins at Ignition – Insurancetimes.co.uk
AXA has appointed Mike Butler, its head of commercial marketing, as general manager of Ignition. Butler, who will retain his current role, replaces Andy Heap, whose departure was revealed in Insurance Times last month. Butler’s appoint follows a
Australian stocks end in the red after rollercoaster day – Adelaide Now
AUSTRALIAN stocks finished near steady on Wednesday after a volatile trading session and despite a positive lead from Wall Street. At the 1615 AEDT close, the benchmark S&P/ASX200 was down 2.4 points, or 0.07 per cent, to 3,579.7, while the broader
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