[技术分析] comments on 20 GOLDEN RULES FOR TRADERS

nobo

Someone posted this in Da Qian. I’ll try to comment from a swing trader’s perspective.

20 GOLDEN RULES FOR TRADERS

Want to trade successfully? Just choose the good positions and avoid the bad ones. Poor trade selection takes a heavy toll as it bleeds your confidence and wallet. You face many crossroads during each market day. Without a system of discipline for your decision-making, impulse and emotion will undermine skills as you chase the wrong stocks at the worst times.
Many short-term players view trading as a form of gambling. Without planning or discipline, they throw money at the market. The occasional big score reinforces this easy money attitude but sets them up for ultimate failure. Without defensive rules, insiders easily feed off these losers and send them off to other hobbies.
Technical Analysis teaches traders to execute positions based on numbers, time and volume.This discipline forces traders to distance themselves from reckless gambling behavior. Through detached execution and solid risk management, short-term trading finally "works".
Markets echo similar patterns over and over again. The science of trend allows you to build systematic rules to play these repeating formations and avoid the chase:
1. Forget the news, remember the chart. You're not smart enough to know how news will affect price. The chart already knows the news is coming.

Nobo: Great advice.

2. Buy the first pullback from a new high. Sell the first pullback from a new low. There's always a crowd that missed the first boat.

Nobo: Be careful what’s your assumption of entry. If you don’t know, set tight stop.

3. Buy at support, sell at resistance. Everyone sees the same thing and they're all just waiting to jump in the pool.

Nobo: it’s a too simplified myth. Often what happened is support and resistance got broken.

4. Short rallies not selloffs. When markets drop, shorts finally turn a profit and get ready to cover.

Nobo: total Bullshit.

5. Don't buy up into a major moving average or sell down into one. See #3.

Nobo: Bullshit.

6. Don't chase momentum if you can't find the exit. Assume the market will reverse the minute you get in. If it's a long way to the door, you're in big trouble.

Nobo: I don’t see the logic here. Just set stop and chase high with your familiar setup.

7. Exhaustion gaps get filled. Breakaway and continuation gaps don't. The old traders' wisdom is a lie. Trade in the direction of gap support whenever you can.

Nobo: exhaustion gap are not easy to define unless afterwards. So yes to this, set stop at the gap support.

8. Trends test the point of last support/resistance. Enter here even if it hurts.

Nobo: see #3

9. Trade with the TICK not against it. Don't be a hero. Go with the money flow.

Nobo: I don’t care. Don’t use Day trade tool to do Swing trade.

10. If you have to look, it isn't there. Forget your college degree and trust your instincts.

Nobo: you are funny.

11. Sell the second high, buy the second low. After sharp pullbacks, the first test of any high or low always runs into resistance. Look for the break on the third or fourth try.

Nobo: yes, this means the second high is a lower high and second low is a
higher low. Make sure momentum is not against you.

12. The trend is your friend in the last hour. As volume cranks up at 3:00pm don't expect anyone to change the channel.

Nobo: don’t know exactly what this means. From my experience, this might be another bullshit.

13. Avoid the open. They see YOU coming sucker

Nobo: Swing trader don’t care about this. Day trader should tie their hands
at the opening

14. 1-2-3-Drop-Up. Look for downtrends to reverse after a top, two lower highs and a double bottom.

Nobo: Works many times but not always.

15. Bulls live above the 200 day, bears live below. Sellers eat up rallies below this key moving average line and buyers to come to the rescue above it.

Nobo: Midterm view to long term view has less effect on swing trade.

16. Price has memory. What did price do the last time it hit a certain level? Chances are it will do it again.

Nobo: good point if volume was high at this level.

17. Big volume kills moves. Climax blow-offs take both buyers and sellers out of the market and lead to sideways action.

Nobo: stay away if it goes sideways.

18. Trends never turn on a dime. Reversals build slowly. The first sharp dip always finds buyers and the first sharp rise always finds sellers.

Nobo: good, wait for the momentum dies down.

19. Bottoms take longer to form than tops. Fear acts more quickly than greed and causes stocks to drop from their own weight.

Nobo: true.

20. Beat the crowd in and out the door. You have to take their money before they take yours, period.

Nobo: of course, how though? Just by out earlier than others? Lol. Easier said than done.

西门吹雪