Spontaneous trades are not agood way to make a living! Just as the professional athlete must have a game plan, so must the professionaltrader. –Larry Connors and Linda Bradford Raschke, from Street Smarts (1995, M. Gordon Publishing Group, Malibu, Calif.).
The VIX (the Chicago Board Options Exchange Volatility Index) is used as a contrary indicator. The higher its reading (and hence the more fear in the market), the more likely the market is reaching a short-term bottom, and the lower the reading, the more likely the mark
Research by Steve Moore showed that when a market closed in the top/bottom 10 percent of its range, it had an 80-90 percent chance of follow-through the next morning but actually closed higher/lower only 50 percent of the time. This implies that there is a good chance of
Stop orders must become traders and investors best friends. Stops must become the most important part of the trading program. The moment an order is filled, a protective stop must be placed. The original stop should reflect the amount the trader is willing to lose, or
If the market starts to move parabolically or makes a range-expansion move, take profits on your entire position. This is very likely a climax! –Larry Connors and Linda Bradford Raschke, from Street Smarts (1995, M. Gordon Publishing Group, Malibu, Calif.).
Immediately look to scale out of your trade as the market moves in your direction. By taking some of the trade off, you are decreasing your risk and locking in profits. If you are trading on a one-contract basis, as you should if you are beginner, move yo
Before you trade market lore, ask yourself, Why isnt everyone rich if something so simple is true? In order to gain an edge over some of the smartest people in the world, you cannot trade generalities. You must step outside the box and think differently.–Larry Connors, from Connors on Advanced
There are two times traders use hope, and both times it means they are doing something wrong.When a trader enters a position and hopes it moves in his or her favor, he or she obviously does not have a winning trading plan.The second time hope comes into play is when a trade is entered and it immedia
It is important to initially trade a new concept or strategy on paper. Only by seeing a pattern over and over again will you truly feel comfortable with it. You must believe in its ability to repeat itself. If a pattern doesnt make sense to you, dont trade it. If you dont have 100 percen
The single most important trading secret is this: Learn to listen to the markets and do not impose your own will upon them. –Larry Connors and Linda Bradford-Raschke, from Street Smarts (1995, M. Gordon Publishing Group, Malibu, Calif.).