1)It HAPPENS so because you entered at a wrong and inappropriate price.
2)Because you choose to enter at a resistance level,where you are supposed to get off the train.
3)Because you entered at a time when all players are waiting to exit.
4)It happens because you enter at that critical fibonacci level where everybody is expecting big bang down.
How to avoid this trap?
Is this the problem you face always?
Buying
you buy a stock and after that you find the stock price goes down.what is the way out for this problem?
Selling
You sell and immediately the price rises. you feel bad.
Three solutions
1. ENTRY
ALWAYS BUY AT SUPPORT.WHERE IS THE SUPPORT? WATCH THE TRENDLINE.IT IS THE SUPPORT.Dont know trendline? Learn it.
2. EXIT
In case of profits, you got two options
Exit at a preplanned target price ,stay as long as price is above trendline.
OR
Exit, for major gains, when price breaks below trendline by 2 to 5%
3. STOP LOSS
Exit when price falls below trendline.
EXIT AT 2 TO 5% BELOW SUPPORT TRENDLINE OR YOUR BUYING PRICE
LEARN TO LISTEN TO MARKET.
If the price went down against you, the market is telling you that you made a wrong decision. listen, accept loss, exit with minimum loss
It is better to have small losses.
Big wins are must
Remember when you buy at support level, you can run away with minimum loss if a problem of market going against you happens.
But if you buy far away from support but close to resistance,then no escape.
Happy trading!
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