I have developed some simple rules to follow for successful investing/trading:
ALWAYS follow the trend - Use 20 Day and 50 Day EMA as the trend indicator.
Sell into strength in downtrends, buy into weakness in uptrends
Don't pay much attention to financial reports/news
Rather buy in higher and be right than catch bottom (buy lower) and be wrong.
Cut the dogs loose, let the horses run
Amateurs don't short
NEVER EVER take more than a 10% loss.
Don't make trading decisions intraday.
If you lose, you learn a lesson. If you get lucky, you learn to gamble.
The worst thing that can happen to a trader is to make money on a bad play.
It's better to miss a play than enter a bad one.
In an uptrend pay close attention to the 20 EMA, in downtrend mind the 50 EMA.
Don't day trade. The stress is not worth the money.
Trade alone if possible. The herd is almost always wrong.
Never reveal your trades to your friends.
Friday, September 11, 2009
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