Ten Stock Market Trading Rules
1. Preservation of capital is absolutely critical.
2. Set mental stops before taking on every position, and use them to take small losses.
3. In sideways markets, have both long and short positions in different stocks.
4. Never BUY A STOCK when it is below its 50-day moving average, and think twice before SELLING one when it is over its 50-day moving average.
5. Have a 3:1 risk/reward ratio on every new position. Successful investing means playing the probabilities.
6. Let the trend be your friend. Don’t fight it.
7. Technical analysis works; if for no other reason than so many people think it will. Check the charts before making any purchase or sale.
8. Let your profits run and cut your losses short.
9. Never average a loss; don’t add to a losing position
10. Follow the rules. No exceptions.