What tick list should you have when entering & exiting a trade?
Grey1
Senior member
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Rustic,
The very most important indicator in both entry and exit is VOLUME.. you need to have volume confirmation as foundation of your trades.. Volume in its purest form and not OBV or any other derivative as they slow down the whole trading process> Most indicators specially trend following ones such as ADX or EMA cross overs are for amateurs and only signal when the fun has finished.. In fact if you take a opposite view once they signal you have far better chance of winning the trade.
Prices can be manipulated easily without volume but with Volume this is near to impossible..
I have used all kind of Advanced indicators ( Ehler, Mesa , .. ) and also some so called proven ( $5000 😱 DUAL TRUST ) Trading strategies with no or little success..
Traded ABGX , CMVT and YHOO today only based on Volume and made £1238.48 🙂 with no reference to any indicator whatsoever ( see the attachment)..
To make best use of price action and volume you need to watch the price behavior and a leading Index and after a few weeks you get there..
PS:- instead of looking for Expensive , magical , indicators try to learn about Risk analysis.. Trading is risky business and the more you know the better trader you become..
PS:-- if you own TS and fancy having a go at some of these advanced, fancy indicators lemme know..
The very most important indicator in both entry and exit is VOLUME.. you need to have volume confirmation as foundation of your trades.. Volume in its purest form and not OBV or any other derivative as they slow down the whole trading process> Most indicators specially trend following ones such as ADX or EMA cross overs are for amateurs and only signal when the fun has finished.. In fact if you take a opposite view once they signal you have far better chance of winning the trade.
Prices can be manipulated easily without volume but with Volume this is near to impossible..
I have used all kind of Advanced indicators ( Ehler, Mesa , .. ) and also some so called proven ( $5000 😱 DUAL TRUST ) Trading strategies with no or little success..
Traded ABGX , CMVT and YHOO today only based on Volume and made £1238.48 🙂 with no reference to any indicator whatsoever ( see the attachment)..
To make best use of price action and volume you need to watch the price behavior and a leading Index and after a few weeks you get there..
PS:- instead of looking for Expensive , magical , indicators try to learn about Risk analysis.. Trading is risky business and the more you know the better trader you become..
PS:-- if you own TS and fancy having a go at some of these advanced, fancy indicators lemme know..
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Hi rustic1
Just coming back with some further thoughts - its possible you're more of a investor than a trader - if so, Jim Slater's authoritative books The Zulu Principle and Beyond The Zulu Principle would be essential reading for any investor, but not helpful at all for traders.
I shall also add another reference when I get home (forgot to bring it into office with me) - an extract from a book by David Cohen from 1999 might be of interest, but , again, only if you're an investor - it contains the tick-list and points-scoring system used by I think Capel Cure Sharp at that time for rating shares as otential Buys, Sells or Holds. Will get back later.
Tom
Just coming back with some further thoughts - its possible you're more of a investor than a trader - if so, Jim Slater's authoritative books The Zulu Principle and Beyond The Zulu Principle would be essential reading for any investor, but not helpful at all for traders.
I shall also add another reference when I get home (forgot to bring it into office with me) - an extract from a book by David Cohen from 1999 might be of interest, but , again, only if you're an investor - it contains the tick-list and points-scoring system used by I think Capel Cure Sharp at that time for rating shares as otential Buys, Sells or Holds. Will get back later.
Tom
rustic1 -
Capel Cure Sharp's share rating system from Bears and Bulls, David Cohen, Metro, 2000.
6 key items, with possible maximum points scores
I financial strength = 2pts
II business diversification = 2pts
III historic record = 1pt
IV earnings/dividend growth potential = 2pts
V management strength = 1pt
VI marketability = 2pts
Key areas arre sub-divided:
I financial strength
a) gearing - 0% gearing (net cash) = 0.5pts: 75% gearing = 0pts
b) cash flow - pos cash flow = 0.5pts: neg cash flow = 0
c) return on capital employed - >20% = 0.5pts:
d) dividend cover - 2x cover = 0.5pts
II business diversification
leading company in growing market, not dependent on single customer or region = 2pts (subjectively reduce for relevant negative factors)
III historic record
5yrs uninterrupted growth of earnings and dividends = 1pt
deduct 0.25 per loss-making year or dividend cut
IV earnings/dividend growth potential
based on forecast for next 2yrs compared with market av.
V management strength
good corporate governance? = 1pt
VI marketability
FTSE100 = 2pts
below FTSE250 = 0pts
scale score in between for market cap
Max score = 10pts
8-10 = grade A - Buy
5-8 = B, Hold
0-5 = C, Sell, or Avoid if not holding
D or E (not defined) = Sell
Charts also consulted to identify momentum and price behaviour.
Hope this might be of some interest and use.
Capel Cure Sharp's share rating system from Bears and Bulls, David Cohen, Metro, 2000.
6 key items, with possible maximum points scores
I financial strength = 2pts
II business diversification = 2pts
III historic record = 1pt
IV earnings/dividend growth potential = 2pts
V management strength = 1pt
VI marketability = 2pts
Key areas arre sub-divided:
I financial strength
a) gearing - 0% gearing (net cash) = 0.5pts: 75% gearing = 0pts
b) cash flow - pos cash flow = 0.5pts: neg cash flow = 0
c) return on capital employed - >20% = 0.5pts:
d) dividend cover - 2x cover = 0.5pts
II business diversification
leading company in growing market, not dependent on single customer or region = 2pts (subjectively reduce for relevant negative factors)
III historic record
5yrs uninterrupted growth of earnings and dividends = 1pt
deduct 0.25 per loss-making year or dividend cut
IV earnings/dividend growth potential
based on forecast for next 2yrs compared with market av.
V management strength
good corporate governance? = 1pt
VI marketability
FTSE100 = 2pts
below FTSE250 = 0pts
scale score in between for market cap
Max score = 10pts
8-10 = grade A - Buy
5-8 = B, Hold
0-5 = C, Sell, or Avoid if not holding
D or E (not defined) = Sell
Charts also consulted to identify momentum and price behaviour.
Hope this might be of some interest and use.
Arya cryptocurrency
Junior member
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Great question! Having a clear tick list for entering and exiting trades can greatly improve your trading discipline and overall performance. Here's a comprehensive checklist you might consider:
Entry Checklist:
1. Market Analysis:
- Confirm the overall trend (uptrend, downtrend, or sideways).
- Identify key support and resistance levels.
2. Technical Indicators:
- Look for confirmation signals (e.g., moving average crossovers, RSI, MACD, candlestick patterns).
- Ensure indicators align with your trading plan.
3. Price Action:
- Check for strong, decisive candlestick patterns or breakouts.
- Confirm volume supports the move.
4. Risk-Reward Setup:
- Define your entry point based on your analysis.
- Set a realistic stop-loss to limit potential losses.
- Identify a target profit level that offers a favorable risk-reward ratio (e.g., 2:1 or higher).
5. Market Conditions:
- Ensure no major news or events that could cause volatility.
- Confirm liquidity and appropriate trading hours.
6. Trade Confirmation:
- Wait for a clear confirmation signal before executing.
Exit Checklist:
1. Profit Targets:
- Stick to predefined take-profit levels.
- Consider scaling out if appropriate.
2. Stop-Loss Management:
- Move stop-loss to break-even or trail it as the trade moves in your favor.
- Avoid emotional decision-making.
3. Trade Monitoring:
- Regularly monitor the trade for signs of reversal or weakness.
- Watch for divergences or sudden price movements.
4. Adjustments:
- Be prepared to modify targets or stops if market conditions change.
- Use trailing stops to maximize gains on trending trades.
5. Trade Review:
- After exiting, analyze the trade to identify lessons learned.
- Record key reasons for exiting and any deviations from your plan.
Having this tick list helps instill discipline, reduces impulsive decisions, and ensures your trades are aligned with your trading strategy. Remember, consistency is key!
Entry Checklist:
1. Market Analysis:
- Confirm the overall trend (uptrend, downtrend, or sideways).
- Identify key support and resistance levels.
2. Technical Indicators:
- Look for confirmation signals (e.g., moving average crossovers, RSI, MACD, candlestick patterns).
- Ensure indicators align with your trading plan.
3. Price Action:
- Check for strong, decisive candlestick patterns or breakouts.
- Confirm volume supports the move.
4. Risk-Reward Setup:
- Define your entry point based on your analysis.
- Set a realistic stop-loss to limit potential losses.
- Identify a target profit level that offers a favorable risk-reward ratio (e.g., 2:1 or higher).
5. Market Conditions:
- Ensure no major news or events that could cause volatility.
- Confirm liquidity and appropriate trading hours.
6. Trade Confirmation:
- Wait for a clear confirmation signal before executing.
Exit Checklist:
1. Profit Targets:
- Stick to predefined take-profit levels.
- Consider scaling out if appropriate.
2. Stop-Loss Management:
- Move stop-loss to break-even or trail it as the trade moves in your favor.
- Avoid emotional decision-making.
3. Trade Monitoring:
- Regularly monitor the trade for signs of reversal or weakness.
- Watch for divergences or sudden price movements.
4. Adjustments:
- Be prepared to modify targets or stops if market conditions change.
- Use trailing stops to maximize gains on trending trades.
5. Trade Review:
- After exiting, analyze the trade to identify lessons learned.
- Record key reasons for exiting and any deviations from your plan.
Having this tick list helps instill discipline, reduces impulsive decisions, and ensures your trades are aligned with your trading strategy. Remember, consistency is key!
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