Roger,
To know which lesson to apply to a situation calls for a set of rules developed for each situation. What I have done is define several situations based on what stocks do. Examples are the MIMBO formation and its components (MIM, MDTL, BO, Retest, Pegline), the IL/ACT/RR, the 3 dRSI trick, Temporal Clearance, the PGDCEB (Post-Gap Dead Cat Exhaustion Bottom), etc, etc....
Each situation I've defined is designed around high probability for significant % potential.
When I recognize what a stock is doing, I can manage a trade based on the rules. If a stock is doing something for which I don't have a set of rules, I don't bother with it. If the stock deviates from the defined situation and does not revert to another known situation (such as a 3 dRSI trick reverting to a 4,3,2 stochastics IHS breakout or something) I will tighten stops.
With practice, it becomes, well I can't use the word "easier"....how about...less difficult.
Have a good weekend,
Doug R |
