Tweet compilation, Part 2
This post continues from this original one (collection all of my tweets related to my strategy and mindset).
Easy to get overwhelmed when there's countless tickers flashing RT quotes, news, and fintwit posts.
Simplify:
1. Identify the few leading sectors/assets
2. Within those, identify the few leading stocks
3. Pull up their weekly charts
4. Draw horizontal lines for entries/exits
“I always say that you could publish trading rules in the newspaper and no one would follow them. The key is consistency and discipline.” – Richard Dennis
Price action tells us more than just fundamentals. It tells us what the market thinks of those fundamentals.
If following a breakout scares you, use a small position size. The real risk is having zero allocation to new leadership.
As market participants, we’re so lucky. Thank you to:
- Fintwitters, bloggers, authors
- Businesses that provide low-cost trading/data/software
- Regulators that give us transparency (13F, CoT, Insider filings)
- Entrepreneurs that allow us to ride along with their success
It’s liberating not having to make predictions or caring about outcomes.
👉🏼 No predictions because the market doesn’t care what we think or want.
👉🏼 Not caring about failed trades because risk is managed and the market is an endless opportunity stream.
Fintwit is amazing, but who you follow matters.
Are you following those that are calm, simple, rules-based, objective, humble? Or those that are angry, have no risk management, cry manipulation, and have an ego?
Simple trading plan:
Buy breakouts in strong stuff.
Why? Because trends and relative strength persist.
When they no longer do, move on.
Losses are always limited, but gains are not.
Do we know what the Fed or companies will report? No
Do we know how the market will react to the report? No
Stay objective. Focus on the price action.
Why do we follow trends? Because trading is a lot easier when you have the wind in your sails. Make your life easy.
3 layers in my process that give rock-solid confidence:
- Follow leaders 💪🏼
- Follow simple, clean breakouts ✈️
- Position size 📏
I strive to do 3 types of posts:
1. market leadership
2. simple breakouts on weekly charts
3. mindset & process
No news, predictions, fancy indicators, etc.
You can have zero knowlede of some market's fundamentals & future prospects, but still be long or short. That, ladies & gents, is the beauty of trend following.
The false breakdown is my fav setup: gives you a nice low entry price with defined risk and potential for a big & fast move.
Confused by the intermarket? It's normal. Correlations can break & moves in diff assets can happen on diff timeframes. It's why I focus on the charts of the leaders that I hold or want to buy.
The best long entries:
- Failed breakdown
- Pullback/retest within uptrend
- Tight range within uptrend
- Breakout
Financial media is all about 'top picks' and price targets/forecasts. That's not how to win.
Focus on learning a rules-based, forecast-free strategy based on price action.
Keep it simple:
- Weekly charts
- Horizontal lines
- No fighting trends
- No forecasts
- Minimal intermarket work
Important Disclaimer: This blog is for educational purposes only. I am not a financial advisor and nothing I post is investment advice. The securities I discuss are considered highly risky so do your own due diligence.