Downlaod this Disciplined Trader Special Report by Norman Hallet FREE. Try this STRIKER9 Binary Options System by Chris Kunnundro RISK FREE for 30 days. Learn this powerful Fibonacci Retracement method FREE that pulls 500+ pips per trade. Norman Hallett here from The Disciplined Trader Training And Support Program: I’m at a trade show today and I was shocked when a marketing associate of mine, who has helped us to make the Disciplined Trader Training and Support Program so popular said to me…
“Some traders have doubts about you because they think people in the Trading Psychology field don’t actually trade and, therefore, don’t really know their issues.”
WOW… I took a step back! I’ve been trading for 30 years…in my own account… I ran my own fund… etc., etc. I then realized that people’s fears MAY have been warranted as most ‘trading psychologist’ DO NOT trade.
I do. And as a Disciplined Trader, quite successfully, thank you! So, in the theme of successful trading, I thought I’d give you a perspective on buying breakouts and selling breakdowns that you may never have heard… garnered from my personal trading experience….
First… Definition of a BreakOut.. When a chart displays a classic resistance point and the market trades above that resistance (BreakDown, of course is opposite).
That “classic resistance” can come in several forms… say, double, triple tops, contract highs, or even in an established uptrend when the market when the market finishes a corrective phase and then moves up and breaks to new highs, continuing the trend.
Did you ever notice that many times a breakout will occur and then within minutes or hours, the market comes back down and hits your stop (that you set down below the breakout point)?…only to continue higher in many cases, leaving you outside the trade you ‘had’, or in other cases reverse?
HERE’S THE TIP…
… and it’s great for establishing a trade with a VERY low risk and avoids, in many cases the “get stopped out only to go back and continue as you thought it would, without you.”
When the breakout occurs, I do nothing.
I exercise patience and wait for the market to come back down and stop everybody out and I put my buy stop half way between the breakout high and the low that was established when everybody who initially bought the breakout were stopped out.
If the market continues to go lower, I’m not in.
If the market continues higher, I’m in with a very short stop (below the low that was established when the market on the down move that stopped all the breakout buyers out.
Now, there are variations of this, like I put on multiple positions when I’m stopped in and take a quick partial profit on the first thrust up… this is a money management technique that is popular (with me!).
Don’t just go out and do what I do. I give you this perspective because I’m a guy that likes keeping my risk low.
I stand the chance, many times, of not catching the breakout move when the market doesn’t come back down to apply my technique… but to me, it’s worth keeping my risk low on trades.
As the Disciplined Trader, I’m perfectly willing to miss trades to preserve my low risk / high profit potential positioning.
PLEEEEEASE Do Not Ask for more detail on this. Look at these words as a perspective. Establish your own enter/exit scheme. Look at any chart and see how my process would have worked.
I think you’ll be surprised.
I KNOW you’ll be surprised at the BreakOut and BreakDown entrance/exit techniques that my friends Hubert Senters and John Carter will will be showing you at our upcoming…
“The Disciplined Trader LifeStyle Event” to be held at the Trump Hotel in Miami Beach in May.
These guys are THE BEST at it. If you haven’t yet registered for the Trader’s EVENT OF
THE YEAR…take a look at who will be there (besides Me, Tisha, John and Hubert)…
I hope you enjoyed this insight on how I buy breakouts and sell breakdowns.
You’ll miss some breakouts using this technique, but you’ll also limit your losses to almost nothing or eliminate them completely with false start breakouts.
STOP IN AT OUR BLOG AND COMMENT ON THIS POST… I’ve just cut and pasted this message there… And I’ll see you in MIAMI in May at the Event!