RATES OF RETURN FROM THE MARKETS
HAVING A PROFIT RATE OF RETURN PLAN & USING CHARTS AS OUR MAP
There’s more to trading than calling turns in price trends.
The best journey we can take when trading is one where we have an actual idea of what profit objectives can be for a trade.
This is having a RATE OF RETURN PLAN or REASON for trading and gives the trade a PURPOSE.
Trading for just the excitement of trading itself is an impoverishing approach to the markets and will not serve you in the long run. We should, in fact, do just the opposite. We should set to project an expected rate of return to our trades based on solid facts.
Yes, this can be done. You can set a percentage profit goal to a trade.
And, yes, it’s a flexible process.
It has to be because we must always be ready for price trend momentum to change. When it does, our trading profit rate of return will alter and sometimes the complete trend will change as well.
You can find your own means of following the markets ( I use the Excalibur Method in the examples shown below), but, the important point is to set an objective rate of return for a trade based on price action clues before putting on the trade.
But, let’s see what kinds of profit potentials we’re talking about that are out there.
We’ll start with a simple grain: CORN
Let’s look at the last 2 trends in CORN and, then, the present one in progress as of this writing.
The profit potential in futures was at least $2500 per contract hypothetically (read Disclaimer below).
Then, our guide, The Excalibur Method, told us that the Rate of Return of 15% that we had projected (ahead of time) was over and that the price momentum had shifted. That’s where one would exit and prepare a new Plan for the short side trading of CORN.
Let’s see how that turned out for projecting a new rate of return for the new trend ahead:
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This new trend did unfold as expected (and as shown in the above chart) and prices declined at a rate of return of around 19% and, could have hypothetically yielded $5,000 per contract on the futures (read Disclaimer below) during this downtrend before The Excalibur Method indicated an exit point and a change to the rate of return again.
So, where are we today for CORN?
The point is that, if one were in a CORN trade now, they should be in it expecting a 16% return on a monthly basis. As long as one progresses along that path and rate of return then one has a reason to be in the trade.
If that rate of return doesn’t hold however, then the reason to be in the trade is gone and, one should exit to reassess and find new possibilities.
. . . Consider this approach as a possibility that can lend MEANING to a trade and, most importantly a FINISH LINE to the trading race.
A lack of a FINISH LINE to a trade is one of the primary reasons that traders overstay in a market and lose profits back to the markets.
I’ll post some expected rates of return for other markets in the next few days so we can observe the opportunities out there in the markets today.
Have a great week ahead. - George
RATES OF RETURN FROM THE MARKETS
For those interested in learning the rate of return approach to trading as well as a unique, accurate analytical tool for evaluating all markets , you’ll find all this information and more extensively explained within the Course I call The Excalibur Method.
The Excalibur Method of tracking markets and price momentum will truly open up your eyes to opportunity in every market.
You can click on the tab at the top of the page for more information or Write me for details.
Those who plan to build a future out of these times will take action based on a sound set of tools and a PLAN.
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