Psychological Preparation for Trading (6)
Secret Six: Only move stops in the desired direction of the trend
Where should you place your stops for the most protection? It’s easy when you place your stops at logical levels as dictated by AbleTrend. A common mistake traders make is to arbitrarily place stops without respect to the market’s price action or movement. A trader will risk arbitrary amounts such as $200, $500, or $1000. Where do these numbers come from? They are arbitrary. In reality, market conditions vary from trade to trade, time to time, day to day, and market to market. Nothing is fixed. That’s why traders enjoy an advantage when they let AbleTrend show them the placement of optimal stops, which are defined by the market price and action itself. Here is an example you can set your stops based on AbleTrend support and resistance levels.
AbleTrend dynamically places and moves support and resistance levels according to the market. What does the market tell us? The current price scale and range tells us the probable price range in the near future. The current price trend tells us the probable market direction in the near future. AbleTrend is designed to use the market’s own predictions to indicate the support and resistance levels – or put another way, you can place stops base on calculated reasoning.
Only move stops in the desired market direction. This means for long trade, only move the stops up; for short trade, only moves the stops down. Be more than willing to take small losses when stops are hit in order to gain big. Small losses are a part of business expenses.
In the upcoming blog we’ll introduce Secret Seven: Turn Mental Discipline into the Power to Profit
The best way to learn a skill using trading software is by practicing it. Though the webinars and free one on one trading sessions will help you to prepare for actual trading on the live markets, it will not tell you how your psychology will react to the experience. This insight is gained only through experience, so give AbleSys trading indicators a try today. To get extra 10% off for AbleTrend 7.0 30-day trial, here is the code: WTMF10 (order online).
You may also learn more about AbleTrend on our blog: blog.ablesys.com
And watch archived sessions from our introductory and member’s webinar series:
Click here to view our youtube page
I welcome your feedback. Did you like today’s message? What other topics would you like to see? Please let me know at gracezh@ablesys.com
Happy Holidays!
Grace Wang
AbleSys Corp.
gracezh@ablesys.com