Study Guide for Come Into My Trading Room - Forex Factory

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ANSWERS 187 key differences between professionals and amateurs is that the pros recognize signals early, while they are still a bit fuzzy and indistinct. An amateur keeps waiting for clear and certain signals. By the time those emerge, a trade is ripe for a reversal. There are two main types of risk—money risk and information risk. An amateur is quick to accept money risks as he enters well-established trends where stops are far away, but the trend is pretty clear and the information risk is low. Professionals, on the other hand, are much more at ease with the information risk, acting in the atmosphere of uncertainty, as long as their money risks are low. DAILY CHART A-6C Sell longs in area A: 3 points Add to longs in area B: 3 points Sell longs in area C: 3 points Sell longs in area D: 5 points Buy longs in area E: 3 points PASS POINT 9 Exit Ratings
188 CASE STUDIES Trade 7: International Business Machines IBM—Entry Answer IBM—Steady Green from Big Blue Chart A7-a Even a quick glance at this chart reveals that IBM has spent the past several years in a broad trading range. Whenever it declines below 90, it is time to look for a bottom, and whenever it rallies towards 120, it is time to look for a top. At the right edge of the chart, in area A, IBM has recoiled from support and is headed higher. This rally is confirmed by the uptick of weekly MACD-Histogram. Note that there is no bullish divergence, simply an upside reversal of prices and the indicator. The fast EMA has already turned up, confirming the rally and giving an Impulse buy signal, while the slower EMA has gone flat, a normal behavior at an early stage of a rally. The daily chart of IBM shows increased volatility following the September interruption of trading on the NYSE. By the end of that month, Force Index traces a bullish divergence A—a more shallow bottom of the indicator during a deeper price bottom. The new high of Force Index in area B calls for higher prices ahead; this message is confirmed by the uptrend of MACD in area C. The uptrend is further A
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STUDY GUIDE FOR COME INTO MY TRADIN
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BOOKS BY DR. ALEXANDER ELDER Tradin
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Copyright © 2002 by Dr. Alexander
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vi CONTENTS Part Two Answers and Ra
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HOW THIS BOOK IS ORGANIZED The firs
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QUESTIONS P A R T O N E
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8 QUESTIONS Questions Trial 1 Trial
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10 QUESTIONS Question 4—Stocks, O
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12 QUESTIONS Question 8—Types of
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14 QUESTIONS Questions 9 10 11 12 1
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16 QUESTIONS Question 12—Alcoholi
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18 QUESTIONS Question 16—Discipli
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BASIC CHARTING T H R E E Trading wi
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BASIC CHARTING 23 Question 20—A B
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BASIC CHARTING 25 Question 22—Bas
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F O U R INDICATORS— FIVE BULLETS
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INDICATORS—FIVE BULLETS TO A CLIP
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TRADING F I V E Beginning traders t
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TRADING 41 Question 41—System Tes
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TRADING 43 A. Trend-following B. Os
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TRADING 45 Question 47—Taking Pro
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48 QUESTIONS Questions 48 49 50 51
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50 QUESTIONS Question 51—Opening
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52 QUESTIONS Question 53—The Dail
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56 QUESTIONS Question 56—The Impu
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58 QUESTIONS Question 59—Exits Fi
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60 QUESTIONS Question 62—Trading
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62 QUESTIONS Question 66—Options
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66 QUESTIONS Question 71—The 2% R
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68 QUESTIONS Question 77—The 6% R
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N I N E THE ORGANIZED TRADER If you
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THE ORGANIZED TRADER 73 Question 83
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O N E FINANCIAL TRADING FOR BABES I
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FINANCIAL TRADING FOR BABES IN THE
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FINANCIAL TRADING FOR BABES IN THE
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92 ANSWERS AND RATING SCALES ings w
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94 ANSWERS AND RATING SCALES ten re
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BASIC CHARTING Answer 19 T H R E E
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BASIC CHARTING 99 Give yourself a p
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F O U R INDICATORS— FIVE BULLETS
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TRADING Answer 40 F I V E D. 1, 2,
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TRADING 113 Answer 44 D. 1, 2, 3, a
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DAY-TRADING Answer 48 S I X D. 1, 2
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DAY-TRADING 117 Give yourself a poi
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ADVANCED CONCEPTS Answer 54 1. E 2.
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ADVANCED CONCEPTS 121 At the right
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ADVANCED CONCEPTS 123 Answer 61 1.
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ADVANCED CONCEPTS 125 Give yourself
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MONEY MANAGEMENT Answer 68 E I G H
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MONEY MANAGEMENT 129 staring at a l
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MONEY MANAGEMENT 131 Six precent of
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N I N E THE ORGANIZED TRADER Answer
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THE ORGANIZED TRADER 135 daily, and
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Page 157 and 158: 148 CASE STUDIES Trade 1: Oracle Co
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Page 208: SOURCES Appel, Gerald. Day-Trading
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