Millionaire Tradersand how that movement plays into the overall trend and from that I
have usually identified the key support and resistance levels, which
I then enter into my beeper machine. Any levels within the support
and resistance zones I am usually very comfortable with. The only
times that I need to keep an eye on the market is when my support
level is breached in an uptrend or resistance level is breached in
a downtrend. But regardless of the direction of the trend, I will
usually check my charts if either the support or resistance zones
have been broken to see if I need to react to it.
This is the main reason why I think trading is very accessible
and easy for individuals. All you need to do is to make sure all of
your eggs aren’t in one basket—diversify, identify a direction, and
figure out what the top resistance level and bottom support levels
are. Movements in the market on a daily basis are very normal. If
there were no movements, I would probably not want to trade. I
just don’t become obsessed with the market. I want to wait for a
good time to get into the market and go with the movements. Ten,
twenty, thirty pips on fluctuations are very normal. If I become
nervous when the market fluctuates 10, 20, or 30 pips, that may
be more of a problem with myself than with my position. This, of
course is if you trade like me and look for big moves. I am only
worried when it moves beyond my predetermined amount—i.e.,
breaks a key level—and that is when I will revisit my position to
see if I need to make changes. Therefore, even if you have a full
time job, you can be active in the market as well. Just have some
sort of alert system either via e-mail, which you can set up some
charting packages to do, or subscribe to a beeper like I have. It
doesn’t require you to watch the market 24/7.
Q: How many pips do you look for in an average trade?
A: Usually I look for at least 75 to 100 pips. The good thing
about currencies is that there isn’t much cost involved. If I trade
a currency pair with a 5-point spread, I view that as my cost of
trading and will usually be satisfied with making 50 to 100 pips,