What To Watch For While Commodity Market Trading

If the operator wishes to use an automatic stop while commodity market trading, a very good method is this:

Suppose the initial commodity market trading is made with a one-point stop. For every ¼ pt. the commodity moves in your favor, change the stop to correspond, so that the stop is never more nor less than one point away from the extreme commodity market trading price. This gradually and automatically reduces the risk, and if the tape reader is at all skillful, his profits must exceed losses. As soon as the stop is thus raised to cover commissions, it would seem best not to make it automatic thereafter, but let the market develop its own stop or 'signal" to get out.

One trouble with this kind of a commodity market trading stop is that it interferes with the free play of judgment. An illustration will explain why: A tall woman “Fear, hesitation and uncertainty are deadly enemies of the tape reader. The chief cause of fear is over- commodity market trading.” and a short man attempt to cross the street. An automobile approaches. The woman sees that there is ample time in which to cross, but he has her by the arm and being undecided himself backs and fills, first pushing, then pulling her by the arm until they finally return to the curb, after a narrow escape. Left to herself, she would have known exactly what to do.

It is the same with the tape reader. He is hampered by an automatic stop. It is best that he be free to act as his judgment dictates, without feeling compelled by a prior resolution to act according to a hard and fast commodity market trading rule.

There is another time when the commodity market trading stop order is of value to the tape reader, when his indications are not clearly defined. The original commitment should, of course, be made only when the commodity market trading trend is positively indicated, but situations will develop when he will be uncertain whether to stand pat, close out, or reverse his position. At such a time it seems better to push the stop up to a point as close as possible to the commodity market trading price, without choking off the trade.

By this we mean a reasonable area should he allow for temporary fluctuations. If the commodity emerges from its uncertainty by going in the desired direction, the s commodity market trading top can be changed or cancelled. If its trend becomes adverse, the trade is automatically closed.

Fear, hesitation and uncertainty are deadly enemies of anyone involved in the commodity market trading. The chief cause of fear is over trading. Therefore commitments should be no greater than can be borne by one's susceptibility thereto hesitation can be overcome by disciplined self-training.

To observe a positive indication and not act upon it is fatal in commodity market trading - more so in closing than in opening a trade. The appearance of a definite indication should be immediately followed by an order. Seconds are often more valuable than minutes in commodity market trading. The tape reader is not the captain - he is the engineer who controls the machinery. The tape is the pilot and the engineer must obey orders with promptness and precision.