Sharing some of my rules which have helped me a lot in my trading journey -
1. Don't look at your PnL all the time.
It really messes up your emotions. To ride stocks for longer, we need less volatility of our emotions too.
If we keep looking at the profit and loss screen, we will most of the time, end up either selling our profitable stock which will keep on moving higher after we exit hit or we will keep riding a losing stock looking at our loss because we would start hoping that it might again turn into profit some day.
When trading, it is always better to focus on the charts and not how much we are making every single minute.
2. Don't login in the 1st hour of the day.
I generally watch the daily and weekly charts for swing trading, so there is no need to watch the market in the most volatile period. Many times we end up taking trades without a proper plan if we see some huge gap up or gap down in some of our favorite stocks.
3. Size kills performance.
Start with 3-5% position size and hold them till at least they are above 20 ema ( better than buying position size of 10-15% and panicking with every move )
4. Nothing good happens below the 50 ema.
A simple rule i follow is, i don't consider to buy anything if it is trading below the 50 ema on a daily chart. Better to buy high, sell higher for better momentum trading.
5. When not many stocks are breaking out and sticking, stay in cash.
Sitting out of market when things are not working out, is a super power. Embrace it.
We don't need to trade daily to make money in the markets.
If you are interested in swing trading, you would love the strategy that i have shared in collaboration with Upsurge - Swing Trading Strategy for Beginners.
We all should have our own rules of trading and should stick to what works best for us.
I would love to know about your trading rules, please feel free to share them in the comments section below :)
My app for learning more about Technical Analysis - Harneet Kharbanda App
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