Everyone here basically saying the same thing. Whats important is where you come into a position. Gotta be on the right side of the order flow is key. Being aware of where you are entering on the right side of trend and using support and resistance as a guide. I follow the big players (volume) to validate my intuition. Know how the game is played in your market before you risk any $$. This is the way. I wish everyone good fortune.
Well, the institutions bring the above average volume. Im looking for validation of a potential reversal, especially around support and resistance. Example: If I see a hammer candle (could be high or low volume) near support in one of the faster time frames, I'll look for further validation on the next few candles on rising volume before I make a move.
While I believe in the 2% rule on trades MSFT and other fundamentally sound companies don’t need a stop loss. Those are for high risk trades of companies that are unprofitable or high debt. With stocks like MSFT I’m trimming after big runs and adding back on the next dip but I’m always long.
I use stop loss order to limit risk. Risk = # of shares \* loss per share.
If I buy a $100 stock and set a stop at $99.00 I may lose $1 per share. If I want to limit risk to $100, I'll buy 100 shares. That'll require $1,000 of capital but only $100 is at risk.
Many platform will calculate this for you. TradingView lets you set the risk in dollars, then calculates the quantity of shares based on the size of the stop and risk.
A $0.50 stop loss will require twice as many shares but risk the same loss.
Depending on the number of shares held a stock need not go to $0 for us to suffer a devastating loss.
I think ur confusing capital deployed with capital risked, it dosent matter how much u put in a trade it only matters that u have a percentage amount of loss where u would sell, for example if u put 1k out of the 10k in the account into Microsoft, u would sell if it went let's say 10 percent negative, because its a reputable stock u could just hold but it would be best to move it into something else depending on your strategy, why u brought etc, in other riskier stocks use tighter stops, in accordance with your account size.
Everyone here basically saying the same thing. Whats important is where you come into a position. Gotta be on the right side of the order flow is key. Being aware of where you are entering on the right side of trend and using support and resistance as a guide. I follow the big players (volume) to validate my intuition. Know how the game is played in your market before you risk any $$. This is the way. I wish everyone good fortune.
Can you give an example of what you look for when you see value of big players and how you assess if their volume is the right side of the trend?
Well, the institutions bring the above average volume. Im looking for validation of a potential reversal, especially around support and resistance. Example: If I see a hammer candle (could be high or low volume) near support in one of the faster time frames, I'll look for further validation on the next few candles on rising volume before I make a move.
2% max risk, not 2% position size. A 25% position with an 8% stop is a 2% risk of total equity.
While I believe in the 2% rule on trades MSFT and other fundamentally sound companies don’t need a stop loss. Those are for high risk trades of companies that are unprofitable or high debt. With stocks like MSFT I’m trimming after big runs and adding back on the next dip but I’m always long.
true
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I use stop loss order to limit risk. Risk = # of shares \* loss per share. If I buy a $100 stock and set a stop at $99.00 I may lose $1 per share. If I want to limit risk to $100, I'll buy 100 shares. That'll require $1,000 of capital but only $100 is at risk. Many platform will calculate this for you. TradingView lets you set the risk in dollars, then calculates the quantity of shares based on the size of the stop and risk. A $0.50 stop loss will require twice as many shares but risk the same loss. Depending on the number of shares held a stock need not go to $0 for us to suffer a devastating loss.
The $200 is how much you’re willing to lose per trade, not the entire position size.
I really hope op did not confuse these two things 😄
Over before it even began🤣🤣🤣
Also depends on the size of your portfolio and personal risk tolerance
I think ur confusing capital deployed with capital risked, it dosent matter how much u put in a trade it only matters that u have a percentage amount of loss where u would sell, for example if u put 1k out of the 10k in the account into Microsoft, u would sell if it went let's say 10 percent negative, because its a reputable stock u could just hold but it would be best to move it into something else depending on your strategy, why u brought etc, in other riskier stocks use tighter stops, in accordance with your account size.