Managing your Trading Risk

Basically, the best traders know when to get in and when to get out. They usually look for a 3:1 risk/reward ratio. The downside risk must be less than the upside potential. While there are several levels of success on the upside, there is only one level of risk on the downside. There are never [...]

Gap Openings

In the event of a gap up opening where the futures gap above fair value and stocks open higher than the prior day’s close, the rule to remember is that the 5- and 15-period moving averages need to catch up. Shorting gaps up is naturally countertrend. This sets up opportunities to place shorts off existing [...]