<aside> 💡 1. One of the most difficult things new traders run into is understanding what the terms and lingo of investing mean. Imagine being dropped off and left alone in the middle of a hectic and loud Chinese food market without knowing Chinese. Beginning to trade is quite similar and below you will find the beginner's guide of terms to know. We're here to guide you through that market.

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Objective 1: Setup the foundation

Support Resistance pdf

Technical_Analysis_Webinar_SupportResistance_Trends.pdf

Support and Resistance Basics

An Essential Options Trading Guide

Average of (at least) past 5 years EPS x P/E Ratio = Rational Stock Price

  2. I've given this list of rules out to a lot of you but I wanted to post them here to make sure they're easily accessible for everyone. These 5 rules are the FIRST thing any trader should establish for themselves before they start trading.
  3. Trade size - Set a maximum trade size for yourself that's relative to your overall portfolio. This typically ranges from around 5-10% but people with a higher appetite for risk can set there's as high as 15-20% although 20% is not recommended for options traders since you could lose almost 1/4 of your portfolio if you're not careful & the trade goes bad. I generally recommend setting it somewhere around 8-10% for options traders depending on your confidence in the trade & risk appetite. Once you work out the math on this you will basically know how much you should be putting into one trade at a time.
  4. Maximum loss - Setting a maximum loss is crucial. Again, this should be around 5-10% depending on your risk appetite & 15-20% MAX for options traders. This is the percentage below your entry price which you should set your stop-loss. It's always important to have a stop in case a stock drops out of nowhere or in case you have to walk away from the screen for a period of time. It's always best to cut losses sooner rather than later. Not everyone is going to win every trade since it's impossible to know for certain where a stock is going to go. Keeping losses small is what separates good traders from great traders.
  5. Always be aware of the risk/reward before taking a trade - This will help give you an idea of how reliable the trade you're about to take really is. It will also help you outline a target price for the stock instead of just wishing on a prayer that it goes up & then having to decide what you're gonna do as the trade is already unfolding.

Chart Patterns

Principles For Success by Ray Dalio (In 30 Minutes)

How The Economic Machine Works by Ray Dalio

Checklist to review before taking a trade