In uptrends, it is more profitable to be long all time highs and positive reactions to earnings. In downtrends, it is more profitable to be short all time lows and negative reactions to earnings. Every trend experiences normal corrections on its way up/down. Such corrections are often good buying opportunities as the trend tends to continue in its major direction. Sooner or later every trend ends. No one knows when. But to maximize and protect profits, we gradually raise our stops to levels, which when broken indicate an end of a trend. There will be times when our stops will shake us out too early from a trend, but we don’t need to catch the exact top or bottom in order to be profitable.
“I turned from a loser to a winner when I was able to separate my ego needs from making money. When I was able to accept being wrong. Before that, admitting I was wrong was more upsetting than losing the money.”
“When we are no longer able to change a situation, we are challenged to change ourselves”
“I’ve made phenomenal amounts of money for very simple decisions but I was willing to make them. Somebody had to. Others are looking for highly complex ways of interacting with the markets, when most of the time it’s only the simple ones that are going to work. ”
“To whatever degree you haven’t accepted the risk, is the same degree to which you will avoid the risk. Trying to avoid something that is unavoidable will have disastrous effects on your ability to trade successfully.”
“(So you didn’t have a clear exit point) In other words, the only way you could stop trading was by losing.”