I am a short-term momentum trader generally focused on trending stocks which appear to offer trade opportunities that are likely to play out over the course of between 1 and 10 days. I focus on stocks, both on the long and short side, which have chart patterns that tend to indicate an impending move in one direction or the other, and where there is an opportunity to exit the trade with a minimal loss if the trade does not develop as planned. I practice scaling in and out of trades, taking partial profits along the way to my price target. How long I am in a given trade, and how much conviction and trust I have in a particular position, depends on many factors that draw on my experience in trading as well as the overall state and condition of the broader markets. At times, I trade exclusively on an intraday basis – generally when the market environment is such that large, unpredictable moves are prevalent. At other times, I lean toward swing trade timeframes, allowing winning trades to run for several days while practicing proven trade management and risk control techniques. It is experience and judgment that helps me distinguish between the two.

Having said all that, there are some important core principles that guide my trading. Without attempting to exhaustively explain every variable taken into account in making my trading decisions, there are some core principles that guide my trading regardless of the security or timeframe I am trading, or the environment that I am trading in:

• Plan every trade, then trade that plan

I always identify entry, target, and stop-loss levels before I enter a trade. Then, I keep those parameters close by so that I can remind myself what the assumptions underpinning my trades are. In the constant noise of the markets, a good trader has an anchor…which is my trading plan.

• Completely prepared

I only trade when I’m completely prepared. My experience shows that if I’m completely prepared for trading, I stand the best chance of making sound and profitable trading decisions. In cases where I have been under prepared, my results show that I’m not at my best and I am much more likely to lose money.

• Calm, detached and focused mindset

I try to stay emotionally disconnected from the movement of the market and think clearly in the midst of all the chaos and emotion that is represented in market trading action. If I am prepared and have a plan in place, then stay calm and focus on that plan, I am more likely to hear what the market is telling me and thereby make good trading decisions. Again, my experience shows that if I let my emotions get involved or lose focus, I begin to make questionable decisions and reduce the likelihood of trading profitably.

• Completely objective viewpoint

As a technical trader (meaning I trade exclusively off of what I can deduce from looking at charts representing price and volume over a period of time) it is important to look at the charts and their meaning without any bias. If I am biased and want (or need) the market or a given stock to go one way or the other, I am more likely to misinterpret or ignore what the charts are telling me and make less sound trading decisions. It is often said that you have to leave your opinions at the door when you walk into your trading room, and I believe that is necessary in order to maintain an objective viewpoint.

• High-reward/Low-risk setups

You can only profit in trading if, over time, your winners are larger than your losers. A key element to achieving that is focusing on trade setups that offer significantly more reward than risk. Starting with a handful of good ideas does not guarantee success in trading, but it does make it more likely that a trader will be able to enter a trade at the point where the risk is low and the reward potential is high. There is a lot more to trading than starting with the right ideas, but it is necessary to start with those ideas if you want to trade profitably. Of course, the point of my premium service is to help you focus on good ideas.

• Consider the counter argument

I like to consider what the argument would be to take the other side of a trade that I’m planning because that helps me think more clearly about what could cause the trade to go against what I expect. Because my style is to trade stocks as they begin to trend one way or the other, it helps to ask myself what factors might help prevent a stock from sustaining a move once it begins, and in doing so, I can second guess whether or not the environment is right for that stock to begin a meaningful trend. Any trader knows that the outcome of a trade is highly uncertain at the point the trade is initiated, but considering the factors that tend to support or refute the idea of a sustained move helps the trader make a more informed decision.

It is impossible in a few short sentences to describe in any complete manner what is necessary to be successful at trading. I strongly recommend that you review my Education page and consider purchasing the four books listed near the top of the page. Those books will explain in great detail what is necessary to develop into a successful trader. I also recommend you take advantage of the INO.com educational services as they offer quality educational videos and other tools for the trader.

I have a strong belief that no individual ever figures the market out, but rather, gradually becomes more capable of reading the technical indicators as well as the nuances of market behavior and interpreting what they mean when considered together. Developing those skills takes time, and the development of those skills tends to increase profit levels in trading; without them I believe the odds are stacked against you as a trader. Having said that, starting with the best trade setups available significantly increases the likelihood of success in trading. It has taken me years to develop the ability to scan multiple timeframes simultaneously for a given stock and understand whether or not that combination of charts represents a truly high-reward/low-risk trade opportunity. And, it is not an exaggeration to say that I scan hundreds to thousands of charts every trading day. While I cannot transfer to you a complete trading skill set that has taken years to develop, I can help point you in the right direction so that the effort you apply in trading is more likely to bear fruit.