Thought I'd start a new thread on "Trading Plans"
The post below was posted in reply to a question in Tec/a thread and is really not suitable there
Wow -- if you expect to make a profit in your 1st year , you are in for a dose of reality - you will find its not the plan you have to sort out but yourself - wonderfull learning oppurtinity this trading , to drag out your short comings!
first off KISS
Trade ONE stock only at a time --- after a while you will get to Know it, feel it everyday movements ahead of time -- you sort of become one with it --- if you have to many stocks in a open position or on watchlist you will not be able to do this !
Thought the 3 plans Leon Wilson outlined where not a bad start -- he carries on further in "the next step"
But all i have done over the past 10years is keep a small watch list of Medium Cap stocks in a consolidation phase --- which do not have a great amount of previouse highs (to much resistance if they go up) -- have a far amount of daily vol (don,t get caught when you want to sell)
Wilson goes into detail in points i am outling
1: check your watch list DAILY
2: Check OBV -- is accumilation starting -- if so seperate this stock/s into another watch list
3: We now use the 2nd watch list
4: Look out for patterns ( triangles etc) -- increasing Vol
5: NOW comes the important bit --- If a stock starts to breakout(on Vol) --use Count Back Lines Before a Entery -- this will also give you your S/T stop
4: If it continues UP -- beaware of the points that S/T traders have set
5: If it continues to rise past these points then you probably have a new trend in place -- GMMAs now take over -- adjust your STOP on C/B & ATR
6: Generally there will be a S/T "pull-back" before the trend gets underway--
cleared out the S/T traders
7: Now just hitch a ride on the stock (adj Stop ) -- watch daily as this stock
hits important points eg: 21ma , trend lines, ADX , price compression ---
go back -what happened before ? --- try and get a feel for this stock
8: Whilst this is going on keep following your watchlists ,so as to begin to understand these stocks --- when the position you have is safely underway --bring in another one
Get a copy of the bible Edwards - " The Technical Anaysis of Stock Treads "
7 th Edit --- no plans -- Just T/A @ ITS BEST
But none of the above is of any use unless you apply stops & money managment !
Guppy's Trend Trading gives a detailed Plan (monthly Trade) -- allthough Shares mag is not around , the same principal applies with Mags,newspapers etc