Aloysius Chan's Blog

Wise lessons Don't compound your losses by averaging down (i.e., don't keep buying additional shares at lower prices). It is tempting to think that a loss "doesn't count" until the position is closed--but it does! Anytime you own a security, ask yourself if you would buy it today. If you wouldn't buy it, you should consider selling it. Don't get distracted by others' investment prowess. Most investors only discuss their successes, threatening your focus and confidence. Wise investments aren't made with Ouija boards, they are made using logical approaches that minimize risks and maximize opportunities. Master the basics. Most investors spend their time looking for easy money (which is not an easy search) instead of learning the key factors to security prices--supply and demand. Indicators Absolute Breath Index (ABI) The ABI shows how much activity, volatility, and change is taking place on the New York Stock Exchange while ignoring the direction pri...

Day Trading Rules Only enter trades when price is at a support (demand) or resistance (supply) level, no matter what time of day or night. Two types of entries: Breakouts and first pullbacks (see below). Each day, identify one demand and supply level in each market, using a larger intra-day time frame. Always know where the market is in the larger picture with regard to supply and demand. Only trade opportunities that offer at least a 3:1 profit zone to the first target. Pre-plan and pre-set: Entry, Stop, Target/s. Don't get fooled by: News, Lagging indicators, Subjective information. Remember, any and all influences on price are reflected in price… Price is all we need. A market is always in one of three states It can be in a state where demand exceeds supply which means there is competition to buy and that leads to higher prices.  It can be in a state where supply exceeds demand which means there is competition to sell and this leads to declining prices.  It can be in a stat...