| APR 1985
Novice Speculator Trading Plan by John Sweeney
Novice Speculator Trading Plan by John Sweeney When all the waiting is done and a new trade is signaled I can at last, get to work. However, it's not to burn up the wires to Chicago — it's paperwork that needs to be done, before the job even starts! Actually, if things are working right, I'll be making out my trading plan a week to two weeks ahead of the trade. Then it gets a yellow paper clip and goes into my pile of daily logs awaiting execution—right next to the paper trades (white paper clips) and the trades under way already (red). Then, as I update the daily action, it's a simple matter to check the plan to see if things are unfolding as foreseen—or not! Why make up the trading plan in advance? Why even make up a trading plan? Answering the second question should answer both questions. I've seen trading plans seven lines long and I've seen them six pages long, but the people who use them know them to be essential for two things: Discipline and Framework. Discipline is needed to make them, refer to them, and follow them. Just as important, your plan puts a framework on a topsy-turvy world, a world where you sometimes wonder if up is still UP or not. The framework is your version of what's happening and what indicators you are following to prove it. A lot of folks aren't inclined to plan anyway. They'll say, ""I've got a hunch,"" or ""The news is bullish,"" or ""I've got to get in on this move!"". Then, they'll think ""You can't predict the future anyway, so why waste time and pretend by making plans?"". Nevertheless, it's essential to make an estimate of what is to happen. That estimate is your strong foothold in the constant sea of price changes and opinions. If as time passes, your estimates are (let's hope) right, then you gain more and more confidence that you are in tune with the markets and with the majority of decisions being made at the margin. You can then trade as if you knew what is to happen because, should something happen that you did not foresee, you know by the variance from your expectations that you are out of touch.
by John Sweeney
Technical Analysis of STOCKS & COMMODITIES
The Traders’ Magazine since 1982
has had over 1,226,237 subscribers from 174 different countries.
37,000 Page Traders’ Archive for $89.99
To continue reading, sign-up for trial access to Traders.com and the S&C Archive — 37,000 pages of trading ideas!
After verifying your email address, you will have limited access to the S&C Archive, as well as access to a Digital Edition of S&C, and access to Traders.com Advantage and Working Money for 30 days.
Not a subscriber to Technical Analysis of
STOCKS & COMMODITIES magazine?
Click
here to subscribe, or request
a trial subscription.
Log-in now to view articles from the S&C Archive.
Your Subscriber ID is located at the top of your magazine label, highlighted here in red.
Your last name can be found on the second line, highlighted here in blue.
*If you have a company name on the label, that can also be used. It will appear below your name on the label.
If you do not have a Subscriber ID on your label, you can find it on your statement or renewal form.
For help locating your Subscriber ID number, please call us at 1-800-832-4642 or send an email to Survey@Traders.com. If sending an email, please include your name and mailing address.