#1 Simple Buy Low Sell High Trading Mechanism

in moneystocktrading •  6 years ago 

Stock Trading/Trading Strategy/Trading Logic/Trading Mechanism

Hello Everyone

In the era of information explosion, information is overwhelming but valuable one is scarce
i am writing to share my trading logic and mechanism and hope everyone could benefit from it

My trading strategy is really really simple and consider only 2 options

  1. Buy Low--> Wait --> Sell High
  2. Sell High --> Wait --> Buy Low

I believe useful strategy is always a simple one and as shown in below, i would share more about how we could BUY LOW AND SELL HIGH in detail

Referring to the below signal, we should always buy/buy cover a security when the price is relatively low, where the market risk is usually low
On the other hand, we should always sell/short sell a security when the price is relatively high, where the market risk is usually high

By defining the appropriate level of risk within a market trend, we could catch the point to enter a long position(or buy cover a short) when the market risk is relatively low and sell at a high price (or open a Short sell position) to take profit

Trading Logic.JPG

From the above graph, overall speaking, as an investor, we should always open a long when the level is 3 or below, wait and let the profit come up together with the price and market risk
Then we simply capture the profit when it comes up to a risk level of 4 or 5

To start with, on 28 August 2018, i would be sharing the risk level for some of the key index and stocks, mainly traded within the US regime
I will be update/putting a red flag at the time when the risk level is going out and let the fact/time to test my trading system

Here you go

SPY/QQQ/EEM would be the corresponding ETFs that are traded in US market to track the performance of the respective Index mentioned below
While APPL/AMZN/TECHY are the big names of the tech companies that many of us should know

You may see that the current risk level is either 3/4, indicating that the market is "NOT at LOW RISK" even if S&P index and Nasdaq is breaking historical high this week

Disclaimer: Do responsible for your own trade and above information is just for sharing purpose, which do not constitute any advice or invitation for trading

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