Average Reviews:
(More customer reviews)I am glad that Dr. Elder took the time to update and publish this book in a new edition. He saw the warning signs of the 2007 bull market coming to an end and had the foresight to write a book about the importance of timing exits and the value of shorting stocks when the time was right. It appears that the author is also as good with his entries and exits in publishing as he is in trading. He could not have given the trading community a better book at a better time when it was first published in May 2008.
If you are searching around on Amazon for a book on trading stocks then look no further, you have found one of the best ones on the market. I have actively traded successfully for over 12 years and read over 160 trading books, this stands out as one of the best. The book is a complete book on trading, it does not skip over any of the most important areas a trader will need for long time success in the markets.
1. The trader must have a trading plan, even discretionary traders.
2. The trader must keep good records to understand his mistakes and successes.
3. A trader should not trade so big that it causes excessive stress and bad judgment.
4. A good rule is to cut every loss to a maximum of 2% or less to limit the risk of ruin.
5. Trading with discipline will put you ahead of the majority of traders.
6. Your trading must fit your own personality and risk tolerance.
7. If you use fundamental ideas for a trade cross check it with the technicals of the chart.
8. Stock option buyers are net losers in the market.
9. Traders can not give up on a stock because they are stopped out, successful traders keep trading the stock until they catch the winning trades.
10. False breakouts and rallies off support are two of the best trading opportunities.
The trading style of the book's author is to trade with a fast and slow exponential moving averages (13,26), along with envelopes. He explains how to use short term swing trades using the MACD and force index to trade when a stock is technically above or below its value zone. The style is not to catch huge trends, it is just to have winning high probability trades by catching half or more of the stocks average range. This is the way professionals trade in a normal market environment. Risk management using stops will protect you from any trend that does take off and falls outside the normal range.
While as the title suggests it teaches when to sell your stocks for profits, and also does the best job I have seen of explaining short selling and when technical indicators show to short. This book is a complete book for any trader. The main lessons of this book is when to lock in profits and exit a trade using a target, and how to double your potential for profits by not only buying stocks but also selling stocks short and buying them back at a lower price for profit.
Professionals sell short because while overall the stock market drifts upward, when a stock falls it falls over twice as fast as it rises. I sell short and it is a powerful tool when used correctly. This book will show you when it is appropriate to short.
Dr. Alexander Elder is the only author I am aware of that integrates trading psychology, money management,technical analysis, and record keeping into one book. These four factors will determine whether you are successful in the market or not, even more than the trading method you choose.
If you are going to be a trader you must follow the money management suggestions in this book. NEVER risk more than 2% of your total equity on a trade, If you follow the 2% rule from the book, it will save you from learning this major life lesson the hard way and save you from huge equity draw downs.
Your long term success as a trader is determined by your ability to learn from your mistakes and not repeat them. The best way to do this is to keep detailed records on a spreadsheet and charts of each trade and a diary of why you traded. You must look squarely at each loss and win. If you learn from each bad trade and limit your loss to less than 2%, it can turn into a long term positive.
This review only scratches the surface of this great book. It is packed with very helpful principles, real trades, humor, and is just outstanding. I really grew as a trader years ago from reading and implementing Dr. Elder's best selling classics "Come into my Trading Room" and "Trading for a Living". If your dream is to trade for a living some day or just trade successfully this is the book to buy.
I was also very glad that Dr. Elder added in trades from the bear market of 2008-2009. I found his explanation of his trades very interesting and informative. There were reviews of some charts from that time period that showed signals of the bottom and when it was time to quit selling and selling short and start buying again.
Click Here to see more reviews about: The New Sell and Sell Short: How To Take Profits, Cut Losses, and Benefit From Price Declines (Wiley Trading)
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