trading is a probability game

trading is a probability game

1. If I roll a 1 or a 2 then I don't win anything. If you have a good trading plan, with a strategy to enter and exit trades, then a successful trade is one for which you followed your plan, not necessarily a winning trade. +91-9821710881. Most people cannot distinguish between luck and skill when it comes to forecasting the market. Each time you roll the dice, you don’t know the outcome, the same as for each individual trade. At the best, I am right 50% on the timing of the trade but I am making money on >80% of the trades. Your only expectation is that something will happen. Normally, I use leading indicators ( price actions, patterns, and candlesticks ) and it is confirmed by the lagging indicators which are stochastic and MACD. Penny Stock Trading So how do you make money not knowing what will happen next? This idea of treating trading as a probability game made a big difference in the way I feel about losses. Trading is Probability Game. Apparent randomness in the market is so complex that it cannot be managed with my finite mind. Pattern, Price and Time: Using Gann Theory in Technical Analysis. I strongly recommend this book. You have no expectation. It is a relative simple system that I had used for probably more than 10 years. Copyright © 2020 : All the views and contents mentioned in this site are merely for educational purposes and are not recommendations or tips offered to any person(s) with respect to the purchase or sale of the stocks / futures. Treating trading as a probability game can help accept these losses. Trading in Stocks like JP with long bias can be injurious to trading account, so its always good to trade in fundamentally sound stocks which will not fall 20-30% in single trading session. They freeze when they see the crash charging towards them. 3. One day, I will write in details on how I record my trades. They freeze when they see the crash charging towards them. Therefore casinos do not care if a player is going through a winning streak, as long as he is not cheating. But each time you roll the dice, you know the odds are in your favor to make money, and you will make money if you play long enough. Someone who masters the probability game produces uncertain outcome but consistent result. As a trader, you have to forget about finding a sure thing. It will help you to know whether you are following the trading plan. - For each trade you take, you don't know the outcome, you accept that anything can happen, and therefore you have no expectation for that trade. You have no expectations that this trade will turn into a winner. Your edge is your strategy to enter and exit trades and should be well defined in your trading plan. After 2 years thinking to restart. Clearly, every time I roll the dice I have no idea what the outcome will be. You take a trade, you accept that you don’t know what will happen next. Fact: Trading is not about guessing the future because it cannot be done. Clearly, every time I roll the dice I have no idea what the outcome will be. If I roll a 1 or a 2 then I don’t win anything. If you have a good trading plan, with a strategy to enter and exit trades, then a successful trade is one for which you followed your plan, not necessarily a winning trade. You have to develop a trading edge using technical analysis, fundamental analysis, market internals, etc.. You have to have a number of variables that must be present before you enter a trade and always use the same set of variables. You have no expectations that this trade will turn into a winner. You must accept the fact that the stock market can do anything at anytime. In a losing trade, many traders are like a deer in a highway facing a crash. All readers of this site must rely on their own discretion and consult their own investment adviser. Now that is dropped to 1 yellow card every 3 months. Anything can happen to the current trade. You need to follow your rules for getting out. But each time you roll the dice, you know the odds are in your favor to make money, and you will make money if you play long enough. Technical system does not need to be too complicated. stock market,trading,day trading,swing trading. Most people cannot distinguish between luck and skill when it comes to forecasting the market. Accuracy is the second aspect of probability.Accuracy depends on the knowledge you have accuired about the stocks you want to invest in and the market trends.

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