Trade With Precision Newsletter - Trade With Precision

News is an important element of trading: it is able to move the market significantly and suddenly and is consequently a key source of volatility. Whilst there are unknown news events (like the shocking Friday the 13th terrorist attacks in Paris), other news is known in advance and can - and should - be factored in your trading.

When it all comes down to it, the decision of whether to take a trade or not, impacts directly on your trading results. It's an area of trading which can cause allot of emotions as it decides whether you enter into a trade or not. If a trader can make consistently sound decisions on whether to enter into a trade or not without emotion then consistent results from their trading edge can flow. Inconsistent decisions on the other hand, lead to inconsistent results. Let's run through the 3 key aspects of trading decision making which you must apply to your own trading.  

Risk control should be at the forefront of a traders mind at all times. Traders need to be continually aware of what their exposure is to any product at any time, just as a scuba diver is aware of how much air they have left in their tank. Traders without stringent risk control procedures in place, risk losing all of their trading capital. Too often we see traders come to us who are far too focused on how much they are going to make rather than how they are going to ensure they control their downside.

Yes, that’s right; the daily chart should be the chart in which you focus most of your attention on as it forces you to see what’s going on in the big picture! Starting out looking at charts can be so daunting as there are so many different timeframes in which you can view so it’s hard to know which one to focus on. Let us make it simple for you – Focus your attention on the daily timeframe first!