A Basic Trade
A Basic Trade is typically a 'bread-and-butter' for every trader. It is something that you lean on over and over again. This is perhaps a type of set up you are comfortable with and like to repeat it with success. For me such a trade is shorting on Fridays on a downtrend.
Fridays are interesting on the stock market. I typically trade index futures, in this case S&P 500 Index Future. It's symbol is /ES. Usually, there is an expiration after than, in this case it is [M22], the full name of the contract will be /ES[M22].
Index futures expires every 3 months, so it is HMUZ, not that hard to remember. Most of the time I do not hold futures position overnight, so the symbol doesn't matter that much anyways for me. I always just trade the active contract. Anyways, today, in the morning I was looking at the chart as I was heading to my daughter's elementary school graduation (please don't ask!). I saw that that the daily and hourly of /ES is on a downtrend, and yesterday it is a big up day for the market. When this happens on Thursday, Friday is typically a profit taking day. I saw the market keeled over in the Asian session, and dropped below VWAP and stayed there. This is my typicall bread-and-butter set up. I don't even look at anything, any trigger in this particular case. I simply so short at the open or just before the open. I typically put a target just above previous day's low or a whole number. In this case I entered short while creating a OCO (one-cancels-other) order at 4133, and I put a target at 4100, and stop at 4160 (which was a spike high). I knew I am not going to time to monitor the trade as I will be in my daughter's school, so this is the only way I can do it today.
At 10:30AM when I was done and arrived home, I saw the trade just got closed with the 33 point profit. A Basic Trade. One good trade!
Disclaimer: This is NOT professional advice, this is all just my own opinion and experience. I am NOT a Certified Financial Adviser. Consult professionals for any financial, accounting or legal related questions you have.
Charts are created in Tradingview.com, which is a free service.
Why do basic trades look so simple on paper, yet not many can reproduce it regularly enough? Maybe once in a while, but nearly not enough regularity.
A very good question. The answer to this can be a post or two. However let me try a short version :
The answer is mostly in your mind. I will use a surfing analogy. A surfer goes out to breaker and waits to catch a wave. When he/she catches it out there it is only a potential (every wave have a potential) perfect wave. You never know if that will be a perfect wave, but you still catch it. If you are average, you get wiped out average times. If you are above average you get it above average times. But point is, if you don’t catch the wave, it is guaranteed that you don’t catch a perfect wave….
There was a movie where this song was featured and there was a comment…
Great song, bad movie:)
So it's a lot to do with the confidence aspect, and a bit of gut feeling to go with it?
yes, but it is more to do with hesitation
Normally grown up people fear the loss. They fear that the set up will not work out. They hesitate and they don't get into the trade. The more you know, as the losses accumulate, more you get into this mode.
I good trader is a kid, she/he just jumps as they see the opportunity and don't think about the consequences..
Kids are the best traders! See how high she is jumping from? :) More than 2 stories high...20ft...and not a drop of fear :)
I am guilty of this. This is probably a scenario where ignorance is bliss, and dangerous at the same time.
If you trade, especially day trade; Danger should be your middle name ;)
Embrace danger :)
It's a leap of faith doc ;)
একবার সিংহের বাচ্চার মুখে লাফ দিয়েছিলাম দাদা। সেই বাচ্চা সিংহ গুলো বড় হয়ে এমন কামড় দিয়ে ধরে রাখসে.....😂😂😂
Would you please teach us the basics of trade and trading analysis rules....?
I would direct you to google and YouTube
well, what else can I say :)
There's enough out there, it's true.
What is the difference between gambling and trading?
Gambling is based on luck. Trading is calculated risk. Watch "The big short" to see a real good example.
Oh well, pro-gamers use math to make their odds better, especially in Sports Betting that is a big thing.
That is actually a good way to teach. There are many educational videos on YouTube, and we can learn a lot of things by doing a Google search.
Well what he did was short selling where basically you loan shares or coins and profit off lower bids the same applies for buying or investing only thing is your just selling straight profit you can still lose and win
Congratulations on your win even though some people so called won't like you lol 😂
why exactly?
Because you shorted I guess it's some who would complain or being jealous
I am not an expert either, but the downward movement is obvious on the chart. Of course it takes a good amount of bravery to open either a long or short position. Especially with real money.
Yeah really especially using leverage
Trading oldschool stocks, a rare breed in the crypto space.
I just trade S&P 500 index future most of the time.
Your content has been voted as a part of Encouragement program. Keep up the good work!
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