Thanks for reply's
Am i right in believing trend trading is generally the longest method of trading but with larger returns?
etc i think i shall go into the forex markets as its 24 hour trading so i can do it out of work to supplement my income - then i kind of decided to have swing trading as my method because its meant to be easiest for novice strategies -
IMHO you're better off, with a lack of time to actively monitor the markets, to trade off the daily charts - set your trades up during the period when the market is closed. Establish firm entry points (either Buy/Sell Limits or Buy/Sell Stops)
Some days you might not get triggered, but that's ok, there's always another day.
Establish clear Target points to exit at profitably.
And make sure you also set up your hard Stop-loss to get you out of the trade if it gets triggered but goes against you.
Then walk away from the market; don't even look at price, don't get fixated on every tick up or down. Switch off your charting package. Don't switch on again until after the markets close and you start your assessment for the next day.
Either you'll get triggered or you won't.
If you get triggered, either you'll hit your target and make money or you'll get stopped out and lose money. Cold simple, unemotional. Ruthless.
(I'm avoiding the question of what happens if you get triggered but don't hit either target by close at End of Day- up to you whether to close out EOD or stay in overnight)
Two lessons from my years backing horses for a living: I used to love watching races (well as an ex-jockey who could blame me?) But whenever I had an "interest" in a particular race, I wouldn't watch it. just check the results afterwards to see how my evaluation had fared. Take the emotion out.
Secondly, don't bet on every race and at any price. Wait until everything comes together - the right horse for the right race at the right odds. Just like trading. Newbies think they have to jump in and trade every tick, every indicator cross, every whatever. Wrong. Be patient for your set ups.
Exercise very very conservative money management (MM) - only risk 1-2% of your trading equity on any one trade
Example:
you have $10,000 in your account. 2% of that is $200.
So if you're trading a currency pair that is worth $10 a pip, your hard stop-loss should be no more than 20 pips.
Which is very tight, which means you will likely get hit by market noise and stopped out which will erode your capital even if 100% trades had gone your way eventually.
How to overcome that ?
Simple - Use wider stops !
But you
can't because that would mean risking more than 2% of your capital. Welcome to the wonderful world of Catch-22 trading
I'd say the single most frequent reason traders wash out is because their equity is too small to start with. Either they keep getting stopped out, and thereby losing money, by meaningless market noise, or else they overtrade - risking more than reasonable MM would recommend.
Sorry, hardly words of encouragement, but you'll find out sooner rather than later how tough this game is.
..........................
Another suggestion that comes to mind, depending on what time zone you're in and if you're determined for a little bit of "live" action.
Wait for the opening of the YM. If it gaps up or down from the cash session close of the previous day, there is a statistically significant likelihood that the gap will be filled same day. particularly if the overnight trading and pre-market volme is low.
Many days there's no gap. But it happens more frequently than you may think.
So when a set-up occurs, place your orders to go long or short, target just a couple of point shy of the point where the gap would fill.
eg if the cash session closed yesterday at 650 but gapped down on today's opening to 615 then your target should be 647/648.
Work out how many points that could potentially profit you, in this case 32 or 33 and set your Stop-loss accordingly (at a 1:1 ratio that would obviously be at 583/582)
You're not going to get rich quick this way, but if you want a little fun in the markets, at the same time as having a statistical edge, and also providing useful experience and practice in determing risk/reward ratios, setting Stops, etc then this may be for you ? Or may not, mai pen rai, up to you.
At least you know there's a maximum potential of only 1 trade per day so you're not constantly hugging the screens for hours looking for new set-ups.
And it might be something you can do in your lunch hour ?
Good luck, hope it helps
ps, forgot one caveat - don't trade the Gap play if the gap is <10 or >70 points. The former isn't really a "gap" and anyway trying to fill for only 10 points is not worth the risk with the spread etc.
and anything over 70 could be an indication that professional money is behind a serious break-away gap
