Simplification

It's been several years of trading for me, and not a good winning streak over the whole time. So I asked myself what worked and what didn't. I found the time I lost the most was when I allowed a position to lose and keep hoping it would bounce back. I could have cut my losses half the time, and win bigger the other half and still be happy.

So after stepping back, it's time to simplify. There are several things I know - stocks trend. It's observable when you look at any time scale with enough data points. So the key must be to identify the points where a trend reversal occurs, and drop out if you're wrong. The biggest problem is it's very hard to tell how long the trend will last. But if I follow my expectations, I'll know when to get out most of the time.

I do believe in candle charts. I don't believe in the accuracy of candle signals. It goes along with simplification. If you're trying to read too far into something, you're probably not seeing the forest through the trees. So after all this talk of simplification, I must have some simplified trading rules in mind. I do. But that is for the next set of thoughts.