A Brief Look Into My Trading Mentality and Strategy

Personally, I’d rather hold two long term trades making 50% profit at the end of the year than scalping thirty trades throughout the year and making the same profit at the end of the year. Don’t get me wrong, both result in positive gains and in either result most people would call it a great year.

But, there will be some days when I don’t have access to a laptop or computer during market hours (at least until I get my laptop in the mail). If I start trading shorter time frames, I’ll end up missing an entry or maybe making a decent exit. But I also understand that not every trade can withstand two months+ of market volatility. There are many stocks that rally for a month and then spiral out of control. In that sense, I won’t be just buying it and then forgetting about it for a year or two.

My goal is to ride the stocks that have been going up consistently for at least three months and to use either a 20 or 50 day moving average as a trailing stop. If the trend breaks then I’ll take my position out of the market and move on.

Aside from the previously mentioned, as many of you know, there are opportunities to make money in the short run also. If I see a trade that looks like it will be going up in the short term (a couple of days to 2 months) with low risk (risk is determined by the stop ), I will initiate a position. In order for me to be successful with this strategy, I will have to know that I will have access to a computer during the period in which I will have to monitor the stock closely. I don’t like setting actual stops with my broker because there will be times when the stop is briefly hit, but at the end of the day the stock finishes up for the day.

This short term strategy will enable me to more readily adapt to market conditions. Also trading in the short term will give me a better idea and the feel for current markets situations. To keep this strategy separate from the other strategy, I will keep a journal recording the approaches to particular trades.

I've hit somewhat of a rut in terms of improving my trading, maybe you guys can give me insight as to how you guys continue to improve your trading either mentally or technically speaking.

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