Example of my Entry and Stop loss

A few people that I know want to know how I make a entry to a stock once I made the decision to buy. I will use TTM that I purchased today to use as my example. I had already determined that TTM was in an up trend and I really didn’t care if they made money of not. Follow the money and follow the trend, up or down.

Keep in mind, this is just one method and not a golden rule with every single purchase or sale. Once the market opens, watch to see what the high and low price is for the first 30 minutes between 9:30am and 10am. Once this range is set, watch price for a breakout above or below in order to go long or short. Notice on the chart above, at the 10am time we broke out with volume and that is your entry.

Now here is the most important part of the entire process. STOP LOSS ORDER !! Say it to yourself over and over again, “I must set a stop loss order, or I’m not allowed to trade.”

No one can tell anyone were to set a stop loss order, because we all have a different tolerance of what we want to lose on any given transaction. But I can tell you, that if you take 9 small losses, and 1 really nice winner, you will come out ahead. One method that I like to use is displayed in the chart above. Select a 10 minute chart, then input a 195 period simple moving average and there you will have it. You could also use a percentage loss, a dollar amount loss, or a actual dollar amount that doesn’t float. Whatever you do, do something. Never walk away from a order without setting a stop loss. It will save your capital so you can live to play another time.