The prior email was intended for our paid subscribers but since I incidentally sent it out to all members so I will provide one of the 7 trade ideas sent out.
We have been patient waiting for the environment to improve, it has so we are looking at trades as the market attempts to push higher.
Buy Stop: 4225
Stop Loss 3875
Few rules to our strategy.
- Wait for the bloody trade to trigger, do not just jump in, if you do not know what a Buy Stop is google it.
- We generally risk only 1% of our trading capital for a trade, so if you do not know how to calculate position size it is very simple.
Account size ($) / Trade Risk ($) = Position Size
If you have a 100k account and you are risking 1% ($1000) and the pt risk is $350 for the trade ($4225 entry – $3875 Stop = $350) you simply divide
$1000/$350 = 2.85 Ethereum.
Now many will think why am I only buying 2.85 or ~ $10k worth of Ethereum when I have 100k? Well if you lose $1000 on a 100k account you still have 99,000 left over, it is not the end of the world. But buy 20 Ethereum and you are stopped out, that is 20x$350 or 7k so your risk is 7% of your capital, and you would be down at $93,000, that hurts especially if you get a run of two, three bad trades in a row and it does happen.
3. Managing risk is the #1 rule in trading, so yes if you have a 10k account you are looking at buying 0.285 Ethereum. Does not sound like a lot, but habits formed with small accounts will pay off as it grows.
Though a short trade is still active, once again we are pushing up against resistance. Weak stocks fail at resistance generally quickly, they do not linger.
Current momentum is still bullish, broader trend is bullish, and though there is no guarantee it will make a new high, we have a higher low which generally leads to higher highs.
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