Kenneth Lee- Romancing the Stop and other Price Action Fables (Supply & Demand).pdf

Trading Thoughts and Ideas

By; Kenneth Lee

Disclaimer

As always very few of any of this is a novel

idea of my making, just my interpretation of

ideas and facts I have learned over the years and

staring at charts until I was blind.

If anyone feels I have encroached on any of

their proprietary information please let me

know and I will edit or remove. This is being

made for sharing on public forums not as a

money making endeavor.

Plus also remember trading is a lonely

profession and each person is responsible for

their own trading decisions. Everyone has their

own ideas of what is a good or bad trading idea

use this information to build your own Ideas.

Thanks Ken Lee

FOREWARD

In my time trading I have seen many people with

issues similar to these that they have found hard to

overcome and most never get past and finally decide to

give up trading.

I have decided to try and put some of my own trading

thoughts down on paper . One to remind myself on a daily

bases of what are in my opinion the most cost effective

aspects of trading. Or the things that can allow a person to

move forward in the trading game.

The title Romancing The Stop , Is probably based on

the most important of any one single trading issue that is

abused to the detriment by more traders than anything

else. The Stop position.

Moving a stop, adding to a loser to move a entry.

Those things will keep a person from becoming a real

trader every time.

I will also put some of my personal thoughts down of

what I look for as to direction and my personal entry

ideas. Again this is just my own thoughts based on

information gathered over a decent amount of time from

various sources.

Romancing The Stop

The one single aspect of trading that will make you or

break you is using stops correctly. They will preserve your

trading account equity as well as build your confidence in

your own trade plans.

The first and foremost thing a stop does is provide

control for rule number;

1.Always have enough equity to take the next trade.

If you can't take the next trade you are dead in the

water and will have to wait to save more funds to try

again. Plus it is a devastating blow to the ego to have that

feeling of a total loss . Most people can't take to many hits

on their personalities before they decide that this isn't for

them .

Those that keep fighting the good fight can also build

a wall of indifference between themselves and their

trading . Making it sorta alright to continually fail, but

neither idea is acceptable. We are all in this to at the very

least add to our financial situations and better our life's .

Plus your personality will start to suffer and then you can

start to blame out side things on your trading. Blaming

your family and friends or your other job. Which can

lead to self destruction.

So we must learn to love where we place our stops and

realize they are our guardian angels, That we control to

protect us from us. I hear so many people blaming the

market or the charts on why a trade goes bad , but in

reality we have no one to blame but ourselves.

The choice of entry style has less to do with being a

successful trader than does knowing where to place a

realistic stop. I watch a few newbies trade and analysis

their charts and at times one of the most basic faults is

the use of a preset stop loss. This is the stop you set on

your platform to automatically be placed with your entry.

The use of that should be nothing more than to get

your stop on your chart so you can then adjust it to the

correct location. To correct that issue change it from say

15 or 20 pips to 150. Then it is so far out of position you

have no choice but to adjust it. Plus within your trading

plan you should have a price number already picked to

where it should go.

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