What You Might Learn in Your First Weeks in Trading

BellaMike Bellafiore's (Bella's) BlogsLeave a Comment

Below is a great example of what you might learn in your first weeks of trading.

Hi Bella,

Friday was my second day trading live. So far I’m up $72 on day one and up $72 on day two.

I could have done much better on Friday, but I chipped back bits by bits during the mid day. I wrote down my mistakes and things I could done better. I learned that trading live is very different from DEMO, so some of the lists I have here are very different from the ones I sent you before:

1. If you trade IPO stocks, you must know the IPO price (Bella)
2. If a stock consolidates, breaks to the upside, and moves back into the consolidation range, it is likely to break down (Spencer)
3. When your reason in the stock isn’t there anymore, especially momentum lot, get out immediately! Don’t hold and pray!
4. When you trade momentum, don’t just only trade momentum. You should also look for places/prices that are Trade2Hold
5. Don’t trade momentum lot in a consolidation range, unless there’s real momentum going on
6. Inside day, or range, can easily make you to trade on tilt, where there’s no levels, and you’re trying to make up levels, which is dangerous, and can slowing chip your money away (Carlton)
7. Patience: wait until you see a clear entry (setup) where you can define risks. Don’t press it when you don’t have a clear plan
8. When you see thick stocks suddenly drop out huge, it’s foreshadowing weak stocks (Carlton). Example: PCS dropped form 12.9 to 12.7 in 10 seconds
9. WHen stock is weak, broken, and you have to offer up due to uptick rule, you’ll have to be patient, and forget about making the spraed, because you make most of your money on Trade2Hold (Spencer)
10. In weak, broken stocks, don’t think about going long; focus your energy on getting short.
11. when downtrend has ended, you need to stop being aggressive at shorting. Instead, look for retracement that provides good entry for shorts.
12. Discipline: having a good price is very important. Fear of missing a move, chasing, and then getting stopped out is two mistakes (Bella)
13. Before 9:50am, there’s mostly no trend. Take profits on big moves (Spencer)
14. Know your “No Trade Zone” = range that slowly kills you (Spencer) (Plus, risk/reward makes no sense)
15. When a stock has huge down move, statistically, it may consolidate a few days before another down day (Carlton)
16. Don’t trade mid day unless there ares A+ setups.
17. Don’t trade just because junior traders are trading it. You must really know what setups are being presented
18. Careful to short retracement spikes when market is so extended to the short side, and near panic/capitulation zone

One Good Trade

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