1. you don't have defined rules which you have to follow in trading.2. you don't use "initial stop" to trade and stick to that initial stop.3. you get concerned about your position.4. you look at "normal candlesticks" too much and give them too much value.
Now here is the problem..................
1. One has to have all rules defined in a note..........What I personally do is that I record all my rules of certain situations/patterns in a video tutorial. I mean,say for example,I have come discovered a pattern to trade. What I do is to video in which I try to define the exit,entry,market condition,failure,initial stop,trailing stop,profit taking stops,and so on.........I run and watch the video in my leisure times,or whenever such patterns appear. That way,I feel confident to trade the pattern,as I know what may happen next.......I make the patterns a part of me like that so that I become natural to trade them...........etc...................Give this idea a thought. It does improve trade substantially..........You can easily memorize complex things with this idea...........I apply this idea of tutorial not only in trading,but also in other aspects of learning.............
2. we have serious confusion of stops.............The trailing stops you have shown in the chart are for "trailing" purposes only. They are not to be used for your initial stops. When you launch a trade,you need to have your own stop loss zone,which if violated,should tell you to exit the trade. And this should be defined by your total investment/equity. Or,your risk tolerant percent..............I can tolerate risk of 10% on each trade. So,I don't care if a trade goes down 10% from my buy price. But it violates 10% and reaches to 11%,I surely exit..........By 10%,I mean I can tolerate 10,000 loss on each 1 lach taka bet on a trade in one month. That won't hamper my total investment,my lifestyle,and above won't hurt my emotion.............
How one should determine one's initial exit depends on his own personality and livings,and also the stocks one is trading..................We need to have an elaborate discussion on this stop loss. Note that trailing stops are generally for profit locking! After a trade goes on your way,you should use trailing stops............
Also,you need to consider "position sizing",which is a very good and important idea to know...................
3. Did you ever find that you become emotional after you launch a trade................! And sometimes a lot of negative thoughts clutter your mind. Sometimes you feel you just don't know what to do..........You need to control your emotion.Pls,read ebooks on this matter..............You can do some kind of visualisation to give your mind positive suggestion.............But from my experience,I will say again,if you have defined rules and patterns,you will be able to trade with confidence and avoid negative thoughts of mind...............
4. You must use Heikin Ashi............I surely don't,again "don't",support to trade only by candlesticks. They are very very deceiptive. Use normal candlestick only for interpret the days movement or for the movement of a particular patterns. Pls,go through what I have written about ICBislamic's trade in this forum( viewtopic.php?f=6&t=13 ). I surely used normal candlestick to interpret the movement of that stock.But above all,I knew that there is a pattern(upmove and consolidation) in which all the buying candles are appearing. I actually emphasised the pattern more than the candles. Surely,candles are good. But they show short term move. For a longer term move,you need to see the pattern,where the stock is now...........The critical problem with candlestick is they will bluff you unless you haven't practise them hour after hour. You see a red candle,and you become concerned. Though that candle has not much meaning..........But the problem arises because you become concerned and you start to get emotional. Negative thoughts come into your mind............Pls,note the difference of stocks and trading between bangladesh and other countries...............
I can easily trade by normal candlesticks in U.S market. But they become very much confusing in our market. Because our market is very much volatile............U.S market follows logic and calculation heavily. By the way,forget Warren Buffet. It is very much silly,imprudent,and childish to follow a huge investor like him. He alone can crash/shake part of U.S market(not whole). Small traders like you and me can't and should not follow him. This is unrealistic and unmatched thing! He is institutional investor...................
BD market is all about trend and smoothing out trend. Note that there is a critical difference between other market and ours. And that is timing. We have to wait two days after our buying to sell. But in other countries,you can buy sell anytime. So,one should have different style to trade our market. I have learned this truth the hard way...............I must add one last note : give value to support and resistance in our market. Because they work.......
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