Trading Quotes

Almost 90 percent of all commodity traders and those who day trade equities lose money. As a trader trades, the first few years will be filled with countless mistakes. To trade successfully one needs to consistently make trades that offer low risk compared to the reward. [2003] - Marcel Link

For the most part high probability trades are made only in the direction of the major trend. If the market is uptrending, a trader will wait for a dip and test some support level before entering. [2003] - Marcel Link

No matter what one may have read in a book or how long one has paper traded, as soon as a person starts trading for real, everything changes. Mistakes one never even thought of start popping up left and right, and the best way to avoid making them is to make them, lose money, realize they were mistakes, and consciously be aware of them the next time the same situations arise. A trader needs about 3 to 5 years to get through the learning period. One should have a minimum of $25,000 to $50,000, a 3-year horizon, and a very understanding spouse.  [2003] - Marcel Link

One of the reasons institutional traders succeed better than does the average trader is that they have much more capital behind them. They can and do make the same mistakes but don’t have to worry that one mistake will end their careers; with capital and management behind them, they can survive those mistakes. [2003] - Marcel Link

When a trader first starts out, he needs to remember that it’s not how much you make but how little you lose that keeps you in the game. [2003] - Marcel Link

What is the minimum amount someone should trade with? A safe bet would be about $25,000 to $50,000 for futures and $100,000 for equities. When trading with these amounts it’s reasonable for a decent trader to expect to make about $5000 to $10,000 per month in a good month while still being somewhat conservative in his trading. [2003] - Marcel Link

I’ve been using TradeStation as my charting platform for years.It gives me the ability to write and test systems and then keep track of them, alerting me anytime they generate a signal. It allows one to create indicators and write and test systems with historical data before risking real money. It is the industry standard for the serious trader. [2003] - Marcel Link

I keep CNBC on all day. It keeps me informed on what the market is doing and what it has done but, unfortunately, not on what it will do. [2003] - Marcel Link

I’m a staunch believer in using technical analysis as the main method of trading, but I still think it’s important to know why the market is doing what it is doing. [2003] - Marcel Link

“Buy the rumor, sell the fact.” It’s before the news comes out that the market makes its move; afterward there is no advantage anymore, and so the smart money gets out. [2003] - Marcel Link

If it is bad news and the market shakes it off and rallies, this is a bullish reaction to the news, so buy it. It probably means that the market has already discounted the news. If good news comes out and your stock or commodity fails to rally, the high probability trade is to short it. It’s more important to see how the market reacts to the news than to know what the news is. [2003] - Marcel Link

The way I like to trade a scheduled report is by looking at how the market reacts just a few minutes before the release of scheduled news. Whichever direction it’s moving in is what the consensus is thinking. Many times the initial response after the announcement is a spike upward which quickly retraces, sometimes to keep going lower and sometimes to come back and rally. The best thing to do in these situations is to sit back, wait until the market picks a clear direction and the noise settles. Once the market has picked its direction, there is still a lot of room to make money. [2003] - Marcel Link

Don’t trade your opinion; trade the market. [2003] - Marcel Link

When price moves with strong volume, the market is more likely to follow through, whether it is a reversal or a matter of following the trend. If price moves up while volume increases, a trend is more likely to stay strong. When volume begins to wane, it could indicate that everybody who wants to be long already is. [2003] - Marcel Link

By looking at 60-minute charts, a short-term trader may be able to catch stronger, more stable moves and see things that are not apparent on a 5-minute chart. One can gain a lot by looking at daily and weekly charts because the patterns there are even more significant and can indicate where the real momentum of the market is. [2003] - Marcel Link

By looking at the higher time frames one can see what the direction of the major trend is and where the support and resistance levels are. The 60-minute time frame is extremely important because I think it defines the intermediate (2 to 5 days) move. By trading in its direction, I believe you will get the most momentum out of a trade, as long as there is no support or resistance level or it is not in overbought or oversold territory. It is much easier to wait for an opportune moment to enter a trade and control risk by using the 1-, 5-, and 10-minute charts. [2003] - Marcel Link

Once nearby support or resistance levels have been broken and you are still in the trade, look at the next higher major time frame to get a more significant support or resistance level. The farther out you go, the better the stop will be but the more it will cost you if it is hit. [2003] - Marcel Link

The monitoring time frame should be about 5 to 12 times higher than the one you are most comfortable looking at. When I’m day trading, I tend to look mostly at 5-minute charts, in which case I’ll use 60 minutes as my basis to make and monitor trades. [2003] - Marcel Link

If you trade multiple contracts, one thing you can do is put on a portion of your normal position when you get a signal in a shorter time frame. If it is working and you get a signal in the next time frame, add to it; if you later get another signal in an even higher time frame, add to it again. By doing this you can build into a position and get onboard early to catch a larger part of the move. If the trade doesn’t work, you lose only a portion of what you normally would risk, and when the time comes when everything is working in sync, you will have a larger position working for you. [2003] - Marcel Link

I find it best to use at least four time frames for day trading: the daily or weekly to get an overall picture of the trend, the 60-minute to keep track of the market, and then the 1- and 5-minute for entry and exit timing. If you have a trade that is working on a small time frame and you get a signal on a longer time frame as well, this is a good place to add the trade. [2003] - Marcel Link