Category Archives: Trading

The Profit Distribution in Trading

I recently finished reading the book Trading Risk: Enhanced Profitability through Risk Control by Kenneth Grant. It’s not an easy read, and several times I was reminded of this paragraph from Michael Marcus’ interview in Market Wizards: For almost two years, I traded almost nothing but cocoa, because of the information and help I got… Read More »

Diagonal VS Horizontal Trading Patterns

Over the years I’ve become a bigger and bigger fan of horizontal chart patterns in the detriment of the diagonal ones. It took some time until I was able to articulate to myself why the former are superior to the latter, but now it’s all crystal clear in my mind. In books or on various… Read More »

Remove The Noise From Your Trading

I kept my business to myself. It was a one-man business, anyhow. It was my head, wasn’t it? Prices either were going the way I doped them out, without any help from friends or partners, or they were going the other way, and nobody could stop them out of kindness to me. I couldn’t see… Read More »

A Key Difference Between Average Traders And Professionals

First off, let me emphasize that by professional traders I mean people who actually trade, have done so successfully for years or even decades and have the track-records to prove it. Your run-of-the-mill internet marketer selling trading courses, indicators or seminars obviously doesn’t fit the bill. Many people would be inclined to say that intelligence… Read More »

Why I Disagree With Jarratt Davis’ Stance On Technical Analysis

Jarratt Davis has an interesting story: he started as a Forex retail trader some 10-11 years ago,  soon after that got headhunted by a small startup hedge-fund, and for the past few years he’s been head of trading strategy at Smile Global Management. He’s also involved in training and educating traders via his website. I… Read More »

The Logic of Profit Pyramiding in Trading

I believe that pyramiding of profits is a poorly understood concept among the great majority of traders. It is certainly much less used in practice than its exact opposite, averaging down, also known as adding to a losing position. Reading Reminiscences of a Stock Operator, a book which is almost 100 years old, one notices… Read More »

Paul Tudor Jones and Elliott Wave Theory

A few months ago I wrote an article addressing the magical powers attributed by some to Fibonacci analysis. What I had planned to write next about was Elliot Wave Theory, which I consider to be an equally ridiculous and degrading part of technical analysis. But, a couple of things held me back. Firstly, there’s much… Read More »

Original Turtles Trading Rules

I always say that you could publish trading rules in the newspaper and no one would follow them. The key is consistency and discipline. Almost anybody can make up a list of rules that are 80 percent as good as what we taught our people. What they couldn’t do is give them the confidence to… Read More »

Anatomy of a Trade And a Trading Lesson

After all, the game of speculation isn’t all mathematics or set rules, however rigid the main laws may be. Even in my tape reading something enters that is more than mere arithmetic. There is what I call the behavior of a stock, actions that enable you to judge whether or not it is going to… Read More »