Trading using technical indicators is like using the map and

compass. System trading is like using a GPS. The challenge in

system trading is most people do not have the experience, time

and money to learn how to do it effectively. For a GPS to work, it must

be tested for accuracy and reliability. This is the same for TradersGPS.

System trading came to me because of necessity as I did not deliberately

plan to go into system trading. It was during that time when I could

not trade full time after my client lost the $250,000 that I realized the

need to trade longer term and to systemize my trading. The TradersGPS

system is thus born out of desperation and necessity.

When it comes to position trading, you want to always ride the trend

until it changes. In position trading, positions are open or closed for

two weeks or longer, depending on the progress and the current state

of the trend. Most position traders use longer time frame charts with

daily, weekly or even monthly candlesticks. This style of trading suits

most long-term investors or traders who only have time to monitor

their trades once a day. This is ideal for traders who are holding a fulltime

job.

I like to "scale in" for position trading. This means entering more lots at

the earlier part of the trend when it is still building and slowly decrease

lots to enter as it progresses to maturity. We must always remember

that trends do not only go in one direction. They can change anytime.

Hence, it is our duty to watch them closely.

For long term trading like position trading, I prefer developing systems

to mechanize my entries and exits. That means entries and exits are

performed by the computer without human intervention. This greatly

reduces the involvement of emotions, which complicates the already

complex equation of trading. This system will also help take care and

to calculate proper position sizing (to be discussed in later chapter)

for every trade made. This ensures that my trading account will remain

healthy, even when suffering a series of losses. With a system, the trading

process will be systemized and therefore eliminating discretions.

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