Posted by: joetradingplace | July 17, 2012

Timing is Key

Timing is Key

Danny Garcia a boxer who knocked out Khan said he knew that Khan had the speed…but he said speed only wouldn’t win him the fight…timing is key. And that’s what Garcia did, he just threw the right punch at the right time…Timing… and he won the fight. Same in trading…Timing is key…you have to time your entries and targets. You can be on the right side of the market, but if you are too early or too late, you might get stopped out for a loss and you then watch the market move thousands of pips in your direction. In trading you don’t get paid for being right, but you get paid for taking profitable trades.  Focus on your timing, hone your patience, discipline…Control your emotions, monitor price action closely and only act/react when required.

Timing is required in taking a trade and also taking profits…Define your trading levels and act/react accordingly when price reaches those levels…also set your targets before you place your trades…all targets should be set at levels of technical significance, make sure that you don’t prematurely close potentially very profitable trades or keep the trade opened longer than it is necessary.. ..As you can see, all this need Timing. All the most successful traders we have heard of were very good at timing their trades especially the trend followers….the likes of jesse, Bill Dunn etc. If you are a trend follower and you fail to time your trade…you can miss the biggest move of the year…especially if price fail to provide a decent retracement for you to join the party. A lot of traders will get frustrated when they miss a move, that’s when they try to chase the market….traders usually gets burnt by doing this.

Back to the boxing match, Khan started very well in the first rounds, he had the speed and the pace…he dominated the fight and I think he might have got overconfident and started to drop his hands…that’s when he was caught with the left hook. If we keep winning we tend to become overconfident in our trading and we usually get caught…either we risk more or trade with no stop loss…So no matter how confident you are with your trading, stay humble and never get cocky…Always keep yourself protected by a stop loss….

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