How can you tell if the breakout from consolidation is real or not? Trading rectangular block, i.e. ledges, or sideways chart patterns is a solid market trading approach so long as the breakout is not a false breakout. A legitimate breakout should not retrace to 50% of the block pattern range, as the most profitable trades never retrace below the breakout price. If the low of the daily breakout ba...
Trading Educators Blog
Many beginning traders undergo emotional extremes, feeling sheer ecstasy after a win, but crushing disappointment after a loss. However, as a mature trader, you grow to realize the folly of allowing the natural ups and downs of trading to impact your emotions. Although as a winning professional trader you may stay calm and relaxed even after a series of losses, remaining rational and composed can ...
Three psychological traits prevent traders from becoming consistently successful, fear, anger and guilt. Fear blocks the trade decision making process due to worry about negative events that may or may not occur in the future. Guilt blocks the trade decision making process with unresolved concern about something that happened in the past. Anger is an emotional response to guilt, fear, the indecisi...
Careful analysis of all possible alternatives and all possible consequences of your trading decisions is the first step in good decision-making. Make every attempt to avoid impulsive trading decisions, invariably these lead to taking unnecessary risks. Strive to have a clearly defined trading plan, but keep it as simple as possible. Chart the equity of your trading method so that you can quickly k...