Saturday, May 27, 2017

The Guppy Multiple Moving Averages (GMMA)

The GMMA is a very useful technical indicator for long term investors. I am using this indicator together with the trend lines and simple moving averages for all my analysis on stocks. 

If you are not sure whether to hold a particular stocks and you need confirmation, GMMA is a good indicator to check whether the long term investors are still holding the stock by looking at the "green lines". For a long term bullish trend, the green lines have to be upward sloping, the lines must not compressed and the red lines (short term speculators) must be bouncing off from the green lines.






Monday, February 27, 2017

Trading in Your Own Style

I was listening to John Carter's interview (https://chatwithtraders.com/ep-069-john-carter/) and there was this line that struck me. He said, "As a trader you feel comfortable by being uncomfortable." 

Trading involves risk. It is this risk that makes people "uncomfortable".  I play close attention to my state of mind when trading, because I notice sometimes when I place a trade with a feeling of confidence, chances are that trade is likely to turn sour in the end. And when I was in doubt when placing that particular trade, it turned out fine! So each trade is based on my own calculation of probability of success given the risk scenario that I am projecting. In the end, "feeling comfortable by being uncomfortable" is what I am pursuing. And this is a great challenge to me because who would want to be constantly feeling uncomfortable in their mind? 

I believe each trader has his or her own unique personality that only he or she alone can determine what types of trading systems or styles that suit them. If you see other people become successful in trading, do not envy them, it would not be a good idea if you copy their trading systems, because the results will not be the same.

In addition, we have to acknowledge that the trading environment is dynamic, you need to be flexible to adapt to the trading environment. What has worked before may not necessarily work in the current market condition. Hence, the only way to overcome this is to keep on learning.