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46. How To Protect Your Trading Profits with Trailing Stops
Produced By: InformedTrades on 18 Jan 2008
Tags: howto trade settingstops daytrade (more...)
Description: http://www.informedtrades.com/ A lesson (more...) on how to traders use trailing stops when trading the stock, futures, and forex markets. In yesterday's lesson we talked about some of the psychological difficulties people have with letting their profits run and introduced the concept of the trailing stop as one way traders can overcome these difficulties that are the downfall of so many traders. As we spoke about briefly in yesterday's lesson, once a position has begun to move in a traders favor many successful trader's will manage that position through the use of what is known as a trailing stop. The simplest type of trailing stop is what is known as a fixed trailing stop which simply moves along behind a position as that position begins to move in the traders favor. The beauty of the fixed trailing stop, is that while it will move up behind a long position or down behind a short position as the position moves in the traders favor, if at any time the position begins to move against the trader, the stop does not move, essentially locking in a large portion of the gains the trader has made up to that point. Let's say for example that you had been following the trend in the EUR/USD chart below which started back in August and were looking for an opportunity to get into a trade. Based on your analysis you decided that if the market broke out above the little resistance point that I have highlighted on the chart below and the ADX was in a good position that you were going to enter long at 1.4360 to try and ride the trend. To manage the trade if it moved in your favor you placed a 100 Point trailing stop on the position at 1.4260. Now in this example if the market moved against you from the start 100 points your stop at 1.4260 would not have moved and you would have been executed on that order when the market touched 1.4260. As you can see from the chart below however, in this example the market did not pull back but went higher. As our stop is a 100 point trailing stop once the market moved up from 1.4360 the stop is going to continue to move up remaining 100 points behind the current price. If the market moves down however the stop does not move. So in this example once the market stoped moving higher at 1.4752 so did our stop and since the market pulled back 100 points from that level we were stopped out in this example at 1.4652. Chart Example Most trading platforms will allow you to set a fixed trailing stop on the platform so you do not have to manually manage the order. As we have touched on briefly in previous lessons, indicators can also be used as trailing stops. One of the more popular indicators which was designed specifically for this purpose is the Parabolic SAR which we covered several lessons ago and you should review if you have not done so already. As we discussed in our lesson on the Average True Range (ATR), this and other methods for measuring volatility in the market are often used to set hard stops by traders when entering the market so they do not get stopped out by market noise. In addition to using the ATR as a hard stop, this and other volatility based indicators can also be used as a trailing stop, moving your hard stop along behind the position a set number of ATR's for instance as it moves in your favor. As with a hard stop this protects your position from market noise, while allowing you to look in profits should the market begin to move against you. Many if not all of the other indicators could also be used as trailing stops with the Moving Average probably one of the more popular here as well. Aside from fixed and indicator based trailing stops another strategy that many traders implement is a fixed percentage of profits trailing stop. Using this method a trader will set his hard stop his profit target, and then once the market hits his profit target will then begin trailing a stop which could be any combination of the methods above. This method gives the trader a greater chance that the trade will hit his profit target but provides less protection should the market reverse and begin to move against him. (less)

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Duration: 08:00

43.How to Reduce the Chances of Being Stopped Out on a Trade
Produced By: InformedTrades on 15 Jan 2008
Tags: howto trade Support and (more...)
Description: http://www.informedtrades.com/ A (more...) lesson on how to incorporate multiple support or resistance levels into a trading strategy for the stock, futures, or forex market to reduce the chances of being stopped out on a trade. In our last lesson we looked at how many successful traders incorporate support and resistance into their trading strategies. In today's lesson we are going to expand on this concept by looking at how many traders look for multiple support or resistance levels when placing trades as well as how many chart patterns incorporate this concept already, providing traders with areas in which they can place their stops. As we learned about in our last lesson, when setting a stop many traders will find a level of support if they are buying to enter the trade or resistance when they are selling to enter the trade and place there stop outside of this level. When entering trades many successful traders will also look for trades which have few if any levels of support/resistance in the direction they are trading, but several levels of support/resistance in the direction in which they are placing their stop. Chart example: As we have also learned in previous lessons, one of the key reason's why traders favor or recognize certain chart patterns is because they often times signal what is next to come in the market. What is often overlooked however about almost all of the most popular chart patterns, but perhaps just as important, is their ability to point out potential places where you want to place your protective stop loss. As you can see from the below chart the head and shoulders pattern is a perfect example of this. By entering the trade on a break of the neckline and placing the stop just above the right shoulder of the pattern traders ensure that there are at minimum two resistance levels in between their entry price and their stop level if not more. Chart Example For patterns such as the triangle pattern which do not already incorporate this multiple support/resistance levels between your entry and your stop concept, it is often wise to find entry opportunities which provide these additional levels naturally in addition to the setup when looking at the chart pattern in isolation: That's our lesson for today. In tomorrow's lesson we are going to look at another way traders use to set their stops: Indicator based stops so we hope to see you in that lesson. As always if you have any questions or comments please leave them in the comments section below so we can all learn to trade together, and have a great day! (less)

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Duration: 05:11

42. How to Up Your Chances for Profit When Setting Stops
Produced By: InformedTrades on 14 Jan 2008
Tags: howto trade Support and (more...)
Description: http://www.informedtrades.com/ A lesson (more...) on how to incorporate technical analysis in identifying support and resistance and incorporating this into setting your stop loss when trading the stock, futures, and forex markets. In our last lesson we learned about the Average True Range (ATR) and how traders use this to get an idea of the volatility in the market so they can incorporate this into their stop levels. In today's lesson we are going to add an additional factor that most traders consider important when setting stops, support and resistance. As we have learned in previous lessons many traders will use technical analysis to determine where support and resistance is in the market, and look for trading opportunities based on what that chart analysis tells them. In addition to using technical analysis to find support and resistance levels in which trades can be entered, many successful traders also use this method of analysis to determine where their stops should be placed. One of the most popular methods which we have touched on in previous lessons where many traders use support and resistance in their trading is when trading ranges in the market. Many traders favor ranges, as they provide traders with the ability to enter trades with tight stop losses and much larger potential returns. The reasoning here is that traders can enter a trade just below resistance or just above support in the range, place their stop just outside that level and then their profit target at the other end of the range. Generally the distance between the stop level is much shorter than the distance between the other end of the range, providing traders with a great opportunity for a relatively low risk and potentially high reward trade. Chart Example This is also another example of using tech levels (the bottom and top of the range) to place trades and set stops. Often times however as many traders are employing this type of strategy, the market will jump up or down above/below the resistance/support level stopping traders out of trades before quickly reversing and moving in the favor of the traders original entry price. Because of this traders are faced with the delema of how far to place there stop outside of the range that they are trading, so that they can be in a position where they are protected but are less likely to be stopped out on market spikes. One way that this can be done is by incorporating the ATR. Although the example above shows 1 ATR as the level at which the stop is placed outside of the range. That number could be a percentage such as 50% of the ATR or any other multiple of the ATR such as 2 ATR's outside the range, depending on the traders timeframe, profit target, and strategy. To finish off this example we now have several components which make up a basic strategies for placing stops based on technical levels and can now analyze the feasibility of one of the trades here to see if it fits all of our criteria. (less)

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Duration: 08:13

Otis Collier Shares His Affiliate Checks with you
Produced By: ocollier on 05 Jan 2008
Tags: affiliate checks commission clickbank (more...)
Description: http://www.otiscollier.com I took the (more...)

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Comments: 0
Duration: 08:33

Update about the 20% ROI Banking Venture
Produced By: ocollier on 04 Jan 2008
Tags: banking investment roi interest (more...)
Description: http://www.otiscollier.com Otis Collier (more...)

Views: 1
Comments: 0
Duration: 06:45

23. How to Trade Stochastics Like the Pro's Do
Produced By: InformedTrades on 18 Dec 2007
Tags: daytrade forex futures stocks (more...)
Description: http://www.informedtrades.com/ A (more...) lesson on how to trade the stochastic oscillator for active day traders and investors using technical analysis in the stock market, forex market. and futures market. In our last lesson we learned about the RSI indicator and some of the different ways traders of the stock, futures, and forex markets use this in their trading. In today's lesson we are going to look at another momentum oscillator which is similar to the RSI and is called the Stochastic. Let me start by saying that there are 3 different types of stochastic oscillators: the fast, slow, and full stochastic. All of them operate in a similar manner however when most traders refer to trading using the stochastic indicator they are referring to the slow stochastic which is going to be the focus of this lesson. The basic premise of the stochastic is that prices tend to close in the upper end of their trading range when the financial instrument you are analyzing is in an uptrend and in the lower end of their trading range when the financial instrument that you are analyzing is in a downtrend. When prices close in the upper end of their range in an uptrend this is a sign that the momentum of the trend is strong and vice versa for a downtrend. The Stochastic Oscillator contains two lines which are plotted below the price chart and are known as the %K and %D lines. Like the RSI, the Stochastic is a banded oscillator so the %K and %D lines fluctuate between zero and 100, and has lines plotted at 20 and 80 which represent the high and low ends of the range. Example of a Stochastic Oscillator: Whatever charting package you use will calculate the lines for you automatically but you should know that the data points which form the %K line are basically a representation of where the market has closed for each period in relation to the trading range for the 14 periods used in the indicator. In simple terms it is a measure of momentum in the market. The %D line is very simply a 5 period simple moving average of the %K line. Lastly you should know that you can change the inputs for the indicator and use for example a 3 period moving average of the %K line to get faster signals, however as this is an introduction to the indicator and because most traders I know do not change the standard inputs, I do not recommend changing them at this point. Like the RSI the first way that traders use the stochastic oscillator is to identify overbought and oversold levels in the market. When the lines that make up the indicator are above 80 this represents a market that is potentially overbought and when they are below 20 this represents a market that is potentially oversold. The developer of the indicator George Lane recommended waiting for the %K line to trade back below or above the 80 or 20 line as this gives a better signal that the momentum in the market is reversing. Example of Overbought and Oversold Trading Signals: The second way that traders use this indicator to generate signals is by watching for a crossover of the %K line and the %D line. When the faster %K line crosses the slower %D line this is a sign that the market may be heading up and when the %K line crosses below the %D line this is a sign that the market may be heading down. As with the RSI however this strategy results in many false signals so most traders will use this strategy only in conjunction with others for confirmation. Example of the Crossover The third way that traders will use this indicator is to watch for divergences where the Stochastic trends in the opposite direction of price. As with the RSI this is an indication that the momentum in the market is waning and a reversal may be in the making. For further confirmation many traders will wait for the cross below the 80 or above the 20 line before entering a trade on divergence. Example of Divergence: As the RSI and Stochastic are similar in nature many traders will use them in conjunction with one another to confirm signals. That's our lesson for today. You should now have a good understanding of the Stochastic Oscillator and some of the different ways that traders use this in their trading. In tomorrow's lesson we are going to look at an indicator which allows us to gauge the volatility of a financial instrument over a given time called Bollinger Bands. As always if you have any questions or comments I encourage you to leave them in the comments section below, and have a great day! (less)

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Duration: 06:49

Holiday Tipping: How Much?
Produced By: moneytalks on 17 Dec 2007
Tags: news holiday tipping gift (more...)
Description: From your barber to your mailman, you're (more...)

Views: 1
Comments: 0
Duration: 01:20

14. How to Trade the Flag/Pennant Patterns Like a Pro Part2
Produced By: InformedTrades on 11 Dec 2007
Tags: howto daytrade investing trading (more...)
Description: http://www.informedtrades.com/ The (more...)

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Duration: 05:26

12. How to Trade the Wedge Chart Pattern Like a Pro Part 2
Produced By: InformedTrades on 10 Dec 2007
Tags: risingwedge fallingwedge technicalanalysis howto (more...)
Description: http://www.informedtrades.com/ The 6th (more...)

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Duration: 05:08

11. How to Trade the Wedge Chart Pattern Like a Pro Part 1
Produced By: InformedTrades on 10 Dec 2007
Tags: howto daytrade investing trading (more...)
Description: http://www.informedtrades.com/ The 5th (more...)

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Duration: 03:42

10. How to Trade the Head and Shoulders Pattern Part 2
Produced By: InformedTrades on 06 Dec 2007
Tags: howto daytrade investing trading (more...)
Description: http://www.informedtrades.com/ The 4th (more...)

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Duration: 04:40

Ultimate Gift: Personal Chef
Produced By: moneytalks on 06 Dec 2007
Tags: news cooking chef food (more...)
Description: If you're looking for a unique gift idea (more...)

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Duration: 01:31

9. How to Trade the Head and Shoulders Pattern Part 1
Produced By: InformedTrades on 05 Dec 2007
Tags: how to daytrade stock (more...)
Description: http://www.informedtrades.com/ The 3rd (more...)

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Duration: 03:55

6. Day Trading Lesson 6: Multi Time Frame Analysis
Produced By: InformedTrades on 29 Nov 2007
Tags: daytrade forex stocks fututres (more...)
Description: http://www.informedtrades.com/ The (more...)

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Duration: 03:42

Avoiding Holiday Scams
Produced By: moneytalks on 28 Nov 2007
Tags: news scam holiday season (more...)
Description: While scam artists practice their craft (more...)

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Duration: 01:34

2.Technical Analysis Lesson 2: An Introduction to Dow Theory
Produced By: InformedTrades on 21 Nov 2007
Tags: Money Finance Business Forex (more...)
Description: http://www.informedtrades.com/ An (more...)

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Duration: 04:40

Introducing InformedTrades.com for Stock, Futures, and Forex
Produced By: InformedTrades on 19 Nov 2007
Tags: Forex Stocks Futures Trading (more...)
Description: http://www.informedtrades.com A new (more...)

Views: 1
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Duration: 04:11

HELP US FIND Lil NUPE
Produced By: ocollier on 02 Oct 2007
Tags: kappa alpha psi NUPE
Description: http://www.blackgreeknetwork.com Black (more...)

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Duration: 02:12

What's Your Pet's Value?
Produced By: moneytalks on 15 Aug 2007
Tags: animal dog cat news (more...)
Description: If your family pet is injured or killed (more...)

Views: 1
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Duration: 01:32