Some more wisdom from the markets

DSM

Well-Known Member
#1
Some more of my notes (read in the forum and elsewhere) for benefit of TJ members.

‘Increase the size of your position if they’re moving in your favor and cut losses quickly.’ – Jesse Livermore

An analyst can have an opinion, but as a trader you should have no opinion. The more opinion you have, the harder gets it to get out of a losing position. – Paul Rotter

Many times I am up M2M with 50k-60k, while my TSL locks only 20k, I am ready to give back my 30-40k to the markets and wait for my stop loss to be hit. And many times, this 50-60k M2m reaches to 80k-100k M2M and my TSL moves up and locks up 50k, and then further M2M reaches 140k , My TSL locks up 100k. How many of us can do it comfortably. If we can do this and ready to give some paper profit back to market. We can win this market over long run. That's why I said its not the system, its the winning over the emotions of greed and fear.

See trading more as a challenge and erase the thought of the money – Paul Rotter

What beat me was not having brains enough to stick to my own game - that is, to play the market only when I was satisfied that precedents favoured my play. There is the plain fool, who does the wrong thing at all times everywhere, but there is also the Wall Street fool, who thinks he must trade all the time. No man can have adequate reasons for buying or selling stocks daily - or sufficient knowledge to make his play an intelligent play. – Jesse Livermore

Set a daily goal for profit and loss, with the most important thing being the stopping limit, the maximum loss I take, before I switch off the screens. – Paul Rotter

A speculator must concern himself with making money out of the market and not with insisting that the tape must agree with him. Never argue with it or ask for reasons or explanations. – Jesse Livermore

Once you are in the money, stay in the trade for the long haul. You are playing with risk free money.

Targets are what the markets decides to give they cannot be imposed.

Once in the money, ride the trend. Trail SL, and be willing to give back upto 1/3rd profit.

It is a function of market to move if it don't it will cease to exist , Setups are basically a place were counter trend traders are trap in and with trend traders are trap out, market fool traders so that it can get more ammunition to trend in its original direction.

When we refused to follow chart , and hold onto our specific view/bias, this is the difference between mechanical trading and discretionary trading , the dividing line between success and failure for a trader.

I believe that the bigger the time frame on which you trade, the better it is for your health and ledger. To filter all the short term noise, I use the hourly charts.

It took me five years to learn to play the game intelligently enough to make big money when I was right. – Jesse Livermore

A loss never troubles me after I take it. I forget it overnight. But being wrong - not taking the loss - that is what does the damage to the pocket book and to the soul.- Jesse Livermore

Disregarding the big swing and trying to jump in and out was fatal to me. Nobody can catch all the fluctuations. In a bull market the game is to buy and hold until you believe the bull market is near its end. – Jesse Livermore

The speculator's deadly enemies are: Ignorance, greed, fear and hope. All the statute books in the world and all the rule books on all the Exchanges of the earth cannot eliminate these from the human animal. – Jesse Livermore

Men who can both be right and sit tight are uncommon. I found it one of the hardest things to learn. But it is only after a stock operator has firmly grasped this that he can make big money. It is literally true that millions come easier to a trader after he knows how to trade than hundreds did in the days of his ignorance. – Jesse Livermore

Wall Street never changes, the pockets change, the suckers change, the stocks change, but Wall Street never changes, because human nature never changes. – Jesse Livermore

Big money is made in big swings, and that requires wisdom, risk taking, guts, and the stamina to stay with his trade, add to positions, and leverage to the max. Today's traders are much more concerned with locking in profits and scaling out.

To make money trading you only have to become an expert at one type of trade. There is no need to run several different trading systems. You may simply concentrate on one trading system, and if you trade it well you can become a very successful trader.

Profitable traders wait for the perfect trade setup.

It is important to learn to trade against the crowd. The crowd reacts to the market, but to learn to see the setup and to react to the crowd, this simple change in mindset can produce incredible profits.

If you realize that your trade was is not a good idea, there is no need to wait for your stoploss to get hit, when you know you have made the wrong move you can simply get out of the market and wait for the next trade.

if you are absolutely certain that you made the wrong move, sometimes the best thing to do is to exit the market and then place a trade in the opposite direction.

Do not go looking for trades, wait for them to jump out . This may seem like a weird way to trade, but it is precisely how you can take so many profitable trades. So waits and watch, and when the market gives an opportunity to jump in to a good situation, enter the trade.

It is important that your style of trading makes sense to you, because this will ensure that you stick with the trading strategy over the long haul.

You will have the occasional unlucky streak with several losses in a row. This is not that interesting to me, but what is interesting to me is the way that you will deal with these unlucky streaks. A successful trader does not lose confidence, but continues to take the next trade setups, as they occur. A successful trader does not question his trading strategy. He knows that anyone can flip a coin and get “tails” 4 times in a row, and that is precisely how you should view an unlucky streak – in the long run you will make up the lost money and then some. So there is no need to panic.

Anybody can trade a nice solid trend. It’s the waiting it out and toughing it out that’s the hard part.

Markets can go up, markets can go down and markets can go sideways. If you are to be profitable, you need to buy at one point and obviously sell at one point higher. And if you just focus on the charts and the chart patterns, your life gets a lot easier doing that.
 

whisky

Well-Known Member
#2
@DSM- Good collation, but why are you creating so many separate threads on wisdom, is it adding any more value for the forum & BTW, what "DSM" stands for?
 

DSM

Well-Known Member
#3
KishoreNK,

I subscribe to, and apply where ever possible Barack Obama's motto 'Yes we can' Try it out, it can be quite empowering.

:)

Joke aside, these notes posted are in concentrated form - assimilated over the years or decades of some successful traders experience, and collected by me over years as well. It's easy to read but difficult to digest at a go. Hence is to be taken in small doses.

DSM is a moniker.

Cheers.

@DSM- Good collation, but why are you creating so many separate threads on wisdom, is it adding any more value for the forum & BTW, what "DSM" stands for?
 

Tamil trader

Well-Known Member
#4
Really DSM makes very useful thread to all members.. i have seen in many posts....

i appreciate you

God will bless you to increase your wealth day by day
 

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