The Investor Sentiment - Equity and investments forum for Sri Lankans
Search
 
 

Display results as :
 


Rechercher Advanced Search

Latest topics
» Gota's Era
Dan's 10 Golden Rules EmptyToday at 2:30 pm by කිත්සිරි ද සිල්වා

» Sri Lanka can resume high growth path, cut more taxes: Mark Mobius
Dan's 10 Golden Rules EmptyToday at 2:26 pm by Backstage

» රාජ්‍ය සමාගම් කොටස් වෙළෙඳපොළට ගෙන ආ යුතුයි
Dan's 10 Golden Rules EmptyToday at 11:45 am by කිත්සිරි ද සිල්වා

» Sri Lanka interest rates should go down, currency will not fall: Mark Mobius
Dan's 10 Golden Rules EmptyToday at 11:18 am by The Invisible

» Equation of Happiness Solved
Dan's 10 Golden Rules EmptyYesterday at 5:23 pm by Backstage

» How to get Access to: 104 Technical trading experiments by HUNTER
Dan's 10 Golden Rules EmptyYesterday at 4:19 pm by HUNTER

» තැරැව්කාර සමාගමකට එරෙහිව කොටස් වෙළෙඳපොළ විනය ක්‍රියාමාර්ග ගනී
Dan's 10 Golden Rules EmptyYesterday at 12:31 pm by Rana

» PABC.N0000 (Pan Asia Banking Corporation PLC)
Dan's 10 Golden Rules EmptyMon Dec 09, 2019 6:41 pm by soileconomy

» East West properties
Dan's 10 Golden Rules EmptyMon Dec 09, 2019 10:01 am by LSE

» COMB.N0000 ( COMMERCIAL BANK OF CEYLON PLC )
Dan's 10 Golden Rules EmptySun Dec 08, 2019 11:07 pm by spw19721

» MHDL Millennium Housing
Dan's 10 Golden Rules EmptySat Dec 07, 2019 12:35 pm by pure equity

» පොළී මුදලාලිලාට බලපත්‍ර ක්‍රමයක් හඳුන්වා දෙන්න තීරණයක්
Dan's 10 Golden Rules EmptyFri Dec 06, 2019 11:33 pm by Backstage

» Dividend Announcement
Dan's 10 Golden Rules EmptyFri Dec 06, 2019 10:10 pm by subash

» Colombo US Embassy Air Pollution
Dan's 10 Golden Rules EmptyFri Dec 06, 2019 11:20 am by Ethical Trader

» DOCK.N0000 (COLOMBO DOCKYARD PLC)
Dan's 10 Golden Rules EmptyFri Dec 06, 2019 5:24 am by soileconomy

» SINHAPUTHRA FINANCE PLC (SFL.N0000)
Dan's 10 Golden Rules EmptyThu Dec 05, 2019 9:26 pm by The Invisible

» Land & Property sector chart
Dan's 10 Golden Rules EmptyThu Dec 05, 2019 6:27 am by dhanurrox

» සිමෙන්ති මිල පහළට
Dan's 10 Golden Rules EmptyWed Dec 04, 2019 7:05 pm by nihal123

» සුරැකුම්පත් කොමිසමට නව සභාපතිවරයෙක්
Dan's 10 Golden Rules EmptyWed Dec 04, 2019 7:04 pm by nihal123

» පාස්කු ප්‍රහාරයෙන් පසු වැඩිම සංචාරක පැමිණීම නොවැම්බරයේ දී
Dan's 10 Golden Rules EmptyWed Dec 04, 2019 7:02 pm by nihal123

» Flying is the Safest mode of Transport
Dan's 10 Golden Rules EmptyWed Dec 04, 2019 10:37 am by කිත්සිරි ද සිල්වා

» OSEA .N
Dan's 10 Golden Rules EmptyTue Dec 03, 2019 3:36 pm by dakzsl

» LIOC.N0000 (Lanka IOC PLC)
Dan's 10 Golden Rules EmptyTue Dec 03, 2019 11:39 am by LSE

» Hayleys MGT
Dan's 10 Golden Rules EmptyTue Dec 03, 2019 10:10 am by The Invisible

» Sri Lanka insurer regulatory capital drop with new accounting rules
Dan's 10 Golden Rules EmptyTue Dec 03, 2019 9:19 am by The Invisible

» Thread for News on CSE and SL Economy
Dan's 10 Golden Rules EmptyTue Dec 03, 2019 9:18 am by The Invisible

» Lanka Tiles
Dan's 10 Golden Rules EmptySun Dec 01, 2019 8:43 pm by soileconomy

» ACL Cables
Dan's 10 Golden Rules EmptyFri Nov 29, 2019 11:12 am by The Invisible

» RENUKA AGRI FOODS PLC ( RAL.N0000 )
Dan's 10 Golden Rules EmptyThu Nov 28, 2019 6:04 am by sureshot

» SEYB.N0000 ( SEYLAN BANK PLC )
Dan's 10 Golden Rules EmptyThu Nov 28, 2019 4:17 am by soileconomy

» Thought for the day...
Dan's 10 Golden Rules EmptyTue Nov 26, 2019 7:40 pm by share1

» An Attitude Adjustment
Dan's 10 Golden Rules EmptyTue Nov 26, 2019 12:36 pm by Backstage

» මහ බැංකු අධිපති ධූරයෙන් ඉවත් වෙයි
Dan's 10 Golden Rules EmptyTue Nov 26, 2019 11:00 am by The Invisible

» Sri Lanka cement production picks up
Dan's 10 Golden Rules EmptyTue Nov 26, 2019 9:22 am by Topcat

» Thread for News on Local and Foreign Politics
Dan's 10 Golden Rules EmptyTue Nov 26, 2019 7:04 am by The Invisible

» SEC Chief says ready to hand over baton
Dan's 10 Golden Rules EmptyMon Nov 25, 2019 8:12 pm by ruwan326

» Technology~විද්‍යාව ~ Wisdom
Dan's 10 Golden Rules EmptyMon Nov 25, 2019 8:36 am by ruwan326

» The Theatre | Best movies to Watch
Dan's 10 Golden Rules EmptySun Nov 24, 2019 5:18 pm by spw19721

» SHL.N0000 (Softlogic Holdings PLC)
Dan's 10 Golden Rules EmptySun Nov 24, 2019 9:44 am by The Invisible

» An individual in pursuit of a porcupine found dead in a burrow
Dan's 10 Golden Rules EmptyThu Nov 21, 2019 11:41 am by Backstage

» GLAS.N0000 (PIRAMAL GLASS CEYLON PLC)
Dan's 10 Golden Rules EmptyThu Nov 21, 2019 7:51 am by ruwan326

» APLA.N0000 (ACL PLASTICS PLC)
Dan's 10 Golden Rules EmptyWed Nov 20, 2019 11:03 pm by nesta

» භාරකාර ආණ්ඩුවක් හෙට
Dan's 10 Golden Rules EmptyWed Nov 20, 2019 7:19 pm by nihal123

» ඇඟට නොදැනී ප්‍රතිඋත්තර දෙන හැටි
Dan's 10 Golden Rules EmptyWed Nov 20, 2019 9:28 am by ruwan326

» මගේ කියවීම ...
Dan's 10 Golden Rules EmptyWed Nov 20, 2019 8:28 am by yellow knife

» How the silence on this !
Dan's 10 Golden Rules EmptyTue Nov 19, 2019 5:40 pm by Backstage

» ප්‍රතිඵලේ මොකක් උනත් ජ්යෝතිෂය සත්‍ය වෙන හැටි දැක්කද?
Dan's 10 Golden Rules EmptyMon Nov 18, 2019 9:15 am by ruwan326

» ඇයි අප්සට් ද?
Dan's 10 Golden Rules EmptySat Nov 16, 2019 4:57 pm by chutiputha

» ගෝඨාට ඉල්ලන්න බෑලු
Dan's 10 Golden Rules EmptySat Nov 16, 2019 7:18 am by ruwan326

» සෞභාග්‍යතා දර්ශකයේ ඉහළ යාමක්
Dan's 10 Golden Rules EmptyFri Nov 15, 2019 1:54 pm by nihal123

December 2019
SunMonTueWedThuFriSat
1234567
891011121314
15161718192021
22232425262728
293031    

Calendar Calendar

Disclaimer


Information posted in this forum are entirely of the respective members' personal views. The views posted on this open online forum of contributors do not constitute a recommendation buy or sell. The site nor the connected parties will be responsible for the posts posted on the forum and will take best possible action to remove any unlawful or inappropriate posts.
All rights to articles of value authored by members posted on the forum belong to the respective authors. Re-using without the consent of the authors is prohibited. Due credit with links to original source should be given when quoting content from the forum.
This is an educational portal and not one that gives recommendations. Please obtain investment advises from a Registered Investment Advisor through a stock broker

Dan's 10 Golden Rules

Go down

Dan's 10 Golden Rules Empty Dan's 10 Golden Rules

Post by nihal123 on Tue May 05, 2015 10:32 pm

1. Make sure the stock has a well formed base or pattern such as one described on this web site and can be found on the tab "Understanding Chart Patterns" on the home page, before considering purchase. Dan highlights stocks with these patterns in his newsletter.

2. Buy the stock as it moves over the trend line of that base or pattern and make sure that volume is above recent trend shortly after this "breakout" occurs. Never pay up by more than 5% above the trend line. You should also get to know your stock's thirty day moving average volume, which you can find on most stock quote pages such as eSignal's quote page.

3. Be very quick to sell your stock should it return back under the trend line or breakout point. Usually stops should be set about $1 below the breakout point. The more expensive the stock, the more leeway you can give it, but never have more than a $2 stop loss. Some people employ a 5% stop loss rule. This may mean selling a stock that just tried to breakout and fails in 20 minutes or 3 hours from the time it just broke out above your purchase price.

4. Sell 20 to 30% of your position as the stock moves up 15 to 20% from its breakout point.

5. Hold your strongest stocks the longest and sell stocks that stop moving up or are acting sluggish quickly. Remember stocks are only good when they are moving up.

6. Identify and follow strong groups of stocks and try to keep your selections in these groups

7. After the market has moved for a substantial period of time, your stocks will become vulnerable to a sell off, which can happen so fast and hard you won't believe it. Learn to set new higher trend lines and learn reversal patterns to help your exit of stocks. Some of you may benefit from reading a book on Candlesticks or reading Encyclopedia of Chart Patterns, by Bulkowski. These books can be found on our RECOMMENDED READING page on the website.

8. Remember it takes volume to move stocks, so start getting to know your stock's volume behavior and then how it reacts to spikes in volume. You can see these spikes on any chart. Volume is the key to your stock's movement and success or failure.

9. Many stocks are mentioned in the newsletter with buy points. However just because it's mentioned with a buy point does not mean it's an outright buy when a buy point is touched. One must first see the action in the stock and combine it with its volume for the day at the time that buy point is hit and take keen notice of the overall market environment before considering purchases.

10. Never go on margin until you have mastered the market, charts and your emotions. Margin can wipe you out.

Dan's Trading Tips

Note: If you are new to trading or investing, I suggest reading these rules many times over until they become ingrained so you can act without emotions.

Stocks that breakout and move up with tremendous volume and close near the highs of the day seem to work out best. However many stocks that move up 15% or more on breakout day often fail. You'll just have to watch your stock's action like a hawk and get to see and understand these things over a long period of time. If trading were easy everyone would be making millions. It's not; it takes years and years of hard work and long hours.

Many traders employ a half hour rule, meaning that for the first half hour of the day many traders do not buy any stock that gaps up in price. If the price holds after the first half hour then often many traders will step in a buy the stock. I find this rule works good after the market has moved up for few strong weeks and is not very effective at the start of a new strong move.

If its earnings season then it's an absolute must that you know the date your company reports its earnings. Many traders prefer to be out of a stock 100% before a company reports earnings in case the company misses earnings or guides lower in which case the stock could plunge. Others reduce positions substantially before earnings are released to lower risk as a massive gap lower could be very destructive to your portfolio. The choice is up to you. You can see an earnings calendar on this web site by clicking on the Useful Stock Resources tab at the top of this page. Please verify this information by calling the company or visiting the company's website which you should be able to find in any search engine.

*The market moves in waves that can last anywhere from weeks to months. Then a correction or setback starts, which can last anywhere from 5 to 8 weeks or even as long at 4 to 6 months. If you are starting a free trial and are a novice you may be lucky to join just as the market gets underway, in which case you will see the full power of charting. If however you start after the move has been going for sometime then things won't look as good as traders are paring down positions. Or even worse the market could be selling down hard and working off the prior up move in which case you will be completely discouraged. The power of charts is through waiting for the correction to end whereby the chart patterns will then be fully developed. After weeks of base or pattern building, stocks will begin to lift off and that's when the big rewards come in. The question is, are you willing to wait and be here for the start of the next big move? The biggest mistake a novice can make is to come back after a move has started.

*Please read a few times my interviews in Stocks and Commodities and Traders' Magazine at the top of the home page of this web site. There are many tips and how - to's that will greatly improve your ability to understand how this works.

More good comments can be found in the FAQ section of this web site in the member login area.

I give setups of stocks that are ready to potentially move. That's my job. Your job is to get to know the stock and its movement along with the general market each day. You are the only one that can do this in realtime during market hours. Then if a stock acts well (i.e. volume is very heavy and the stock is moving easily out of the base) then that is the one to buy. I do not buy most stocks that breakout as most do not meet my heavy volume/price action behavior during the day. Also, I buy only the most expensive stocks as the percent loss is least if the stock pattern fails. High priced stocks are the best quality stocks as a general rule in playing the market. Remember to buy as close to the trendline as possible and the volume should come in at least 10 to 20 minutes after you buy (or even earlier) and if not by then, you know no one wants the stock and might as well check out early.

Thanks, Dan
http://www.chartpattern.com/10_golden_rules.html


Last edited by nihal123 on Tue May 05, 2015 10:33 pm; edited 1 time in total (Reason for editing : add web)
nihal123
nihal123
Top contributor
Top contributor

Posts : 5901
Join date : 2014-02-24
Age : 53
Location : Waga

Back to top Go down

Back to top


 
Permissions in this forum:
You cannot reply to topics in this forum