Feeling generous - lesson for Andy. This is relaxed, you can do it on your phone watching telly. It was doing this a lot today but actually this chart s live now, running since a few hours ago
Money: This is on the CFD platform The leverage on this index is 20:1. Usually it's 5:1.
Those are real dollars on the right. SO if you have ONE share and the price goes 20740 to 20760, you made 20 bucks. 10 shares, 200 bucks, etc.
The price is rising, from south west. Then you get a reversal called a reversion. The horizontal-ish run of reversions is called consolidation. Consolidation has a a range, This is a slightly rising pattern, which is great.
A trend, is a series of higher highs, and lower lows. One zigzag indicates, but could be unreliable, you you're twitchy. As you get more zags your confidence increases.
You suspect it might happen because it's common.
At the second change of direction, where it starts going north east, you "enter" ie buy your share near the bottom of the arrow.. You have an idea where it'll stop rising
1) because of where the last "high" was,
2) the S curve in the run of candles,
3) the way the tops of the wicks get shorter.
4)The last candle often has a longer wick when it reversess. (See the long red "bottoming tail" candles above). So you're IN, and you see that long extended wick, and you hit Close very near the top. Perfick. You can also use those long wicks to time your entry.
I've misplaced the arrows a bit so you can see. Same at the bottoms. You could go "short" as well or instead, if you wanted to.
One share would be perfectly viable. If you had say $1500 in your pot, you could trade with $1000. times 20 is about 1 share.
If you added up all those whitish arrows, you'd get about 8 lots of the 20 dollar scale intervals, = $160.
Things can get messy, the runty little arrow in the middle could make you a slight loss. Note the uptrend has stopped, so it was riskier.. If the trend were still going you'd hold on , and wait for the price to have a wobble and carry on up.
You would NOT enter at the next reverse, near the ar$e of the pink arrow, because humps are common - the price could have easily carried on in the direction of the pink arrow.
WHat happens is you grow your pot to say 10k. still using 1k to "bet" with, then give 5k to her indoors for safe keeping.
Eventually you size up, when you're better at it. How much could you lose - well if an arrow jerks down, maybe $100 before you close. But there are tools top help with all that so it's generally less. You place stops, as mentioned earlier.
SO lets say the wife's gone out , you've grown your pot, you can use $5k for your trades. so you could lose say $500, If you do, and
you fret about it, give up trading. Losses are part of the cost of doing business. They will happen, you have to limit the damage. You can practice trade, to gain confidence and learn. If you keep cocking it up you start to believe your own excuses.
Then you will have an attack of the vapours.
Otherwise, trading with 5k, (which is all "winnings" if you collect them up,) you make $800 bucks watching the same telly.
There are supposed "rules " about how much you should risk, but they're hard to apply.
It's actually easier than it seems here, because of the stops you set, but the enemy is your brain. It wants to forget the rules, and then worry, and then have a go at something daft, and then cry about it. That's about 10 times more of a problem than seeing the trades coming.
I use £80k, because it's all winnings, and it's less than the FSCS limit (which means bu8ger all really), and I can "hold the mental" in check at that level. It's not money, it's tokens. You stick to the rules and you gain tokens. If not, your rules are wrong, or you misapplied or you cocked up.
There are LOADS of sets of rules you can learn, but you can win something every day with only one or two learned rules.
Sometimes I can't handle it, and only watch telly, or use 1 dollar at a time, to restore the mental.
Then - do the sums, you have 800k x 20 to play with
So that's 16 times 800 bucks which is ok for the couple of hours.
People say oh that's BS you're lying it doesn't work out like that everybody loses and the rest.
Which bit was hard? If yo like, you can wait for a setup like the above, and ONLY trade in the middle of the runs. OK, so you'd make less. But you almost never lose
Rule #1 is to go wth the trend, when you're learning, not least because if you miss your entry/exit point, you can wait, and after a missed cycle, it'll be going your way again. That's more obvious on a steeper trend.
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Here's another ploy. You recognize an up trend., like inside the red box below. Easier when there's a catalyst in the news, Trumpy said something sensible, Elon farted, etc.
You enter SHORT at the tops of the extra tall candles .
AS I said, the micro points like tops of wicks are easy to nail.
A common thing which catches people, is that they identify a trend, go with it, and it immediately reverses on them. The price "doesn't clear the spread" and they're out the wrong way for a loss.
What you're really doing now is going with the mini trends in the reverse direction to the main trend ( which is at the longer timescale)
So if the trend reverses on you, you've just entered in the right direction, you just hold on. The candles overlap, so if the whole move is 10 dollars, you can "scalp" out 20, 30 dollars from it. A minute is a long time. Sometimes you can take 3 small trades all inside a 1 minute candle, so you get 10 dollars in one direction plus more in the other. Not hard but needs practice and the right sort of movement, and really a better platform than I have. I do it sometimes but it's against their rules for some reason. You can decide to scalp short OR long, or both, inside a candle. That's what the "bots" do. They don't need coffee.
You combine the techniques. WHere you didn't go LONG at the beginning of the pink arrow up above, you feared thatthe trend might be going down. . SO what do you do?? You go short atthe tops of the green candles when they appear, Then if the trend does go short, you;re setto gain from simpy holding on.
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