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The 12 rules:
. q) R; U3 s4 @$ `4 N 01. Determine the trend 02. Buy at single, double and triple bottoms
6 E+ ~ W0 \8 U 03. Buy
! K7 s0 H q$ ^ and sell on percentages 04. Buy and sell on three weeks' advance or " y1 s- g; \* R6 ]) w' f
decline 05. ' s+ G9 o$ h% B9 N; \
Market moves in sections06. Buy or sell on five to seven point moves 0 ?* a, F( k2 d# J8 K, V* W
07. Study 6 u7 R& y6 d& u) d3 g8 I5 N
volume to determine change in trend 08. Study factor and / b% S7 w% R, G2 p; x
periods to `* }' L# g0 [1 S6 r' \6 z; p
determine change in trend 09. Buy on higher tops and bottoms10. A 1 x, \6 L6 g# E! Z s0 [. }
change in 2 J$ {( D6 j, g- T6 m& h/ V
trend often occurs just before or after holidays 11. Buy on a second
+ M4 ~& V9 g- `% d reaction
; r! y$ N/ ^8 Z: K2 l6 N at a higher bottom. When it reacts only two days, it is in a very
$ q8 U m4 h3 B* k) E7 b- u0 w7 {( ? strong % \' k( {4 j& H% ^/ g! r5 W1 f
position. 12. Price gains in fast moves doesˇnt last very long.
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1 _2 Y$ O. b }3 Q% x7 e5 \+ a; r Gann's 24 rules
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' |5 m& G5 n" e! `' s5 r The 24 rules: 01. Never risk one tenth of capital in one trade 02. . K6 x6 u8 h. p' J5 O; R0 N
Always use stop loss orders 03. Never overtrade 04. Never let a / q+ B; N5 i' @
profit run into 3 X" E$ a. \2 I
a loss 05. Do not buck the trend 06. When in , get our or donˇt + w* q9 k: t/ A T( |4 |) u
get in 07. 5 P* D& Z; k7 U7 G
Trade only active stocks 08. Equal distribution of risk in four or 2 u. P! x! X. b5 `# l
five stocks 4 x! t0 q$ D5 s. p9 ?2 I J' r6 L( h
09. Trade market order 10. Donˇt close your trades without a good
- h, `5 O3 i8 Q* {0 } reason 11. ' i6 `& j! y( ^( i8 s
Accumulate a surplus 12. Never buy just to get a dividend 13. Never % F2 ~8 T# G- c/ `5 C+ Q
average a
: A* @7 M: s: X* |" }& t+ Y/ y loss 14. Never get out/in of the market because of impatience or
1 a- H) l3 x5 o5 x; @3 y anxiety 15.
6 r7 {1 m( \$ }+ V5 |3 w( k/ Q Avoid taking small profits and big losses 16. Never cancel a stop
) [+ g; ^: s4 p6 |! I loss order 8 F# v! D: T# g" T7 W& ~7 K$ t
after you placed it 17. Avoid getting in and out of the market too 9 I# E' b: {; O& u4 N$ i5 E) _) Z
often 18. Be 6 E9 I% |5 O; R
just as willing to sell short as you are to buy. Let your object be
! S3 H, S+ n4 J4 g1 A to keep
2 `0 `" S' C# f- G$ M, Z* A with the trend and make money 19. Never buy/sell just because the
- C' x$ j! ]9 K5 E6 W price is 8 o) p6 j% E# s% W3 K5 N
low/high20. Wait till the stock is very active and has crossed 5 e2 L6 B" {- d' r; |$ e4 [0 d% W
resistance
# U* D5 l" f" B7 K levels before pyramiding 21. Select stocks with small volume of $ H" f! z* }* q2 c& ], {4 K5 U( t! h
shares + f# r: L7 F( h0 R% O* k: ?
outstanding to pyramid on the buying side 22. Never hedge one stock - h, q: m1 a7 g2 D4 i1 R
by - K: v1 z4 R( }* {2 ]$ g
another23. Trade with a plan and do not get out without a definite % H/ k* I1 I7 u
indication 0 @1 u' Q0 ]# Y, L
of a change in trend 24. Avoid increasing trading size after a long 6 [- U; t5 [ |, d6 G+ S
period of " l% x1 X( X9 d; m8 O0 C
success/ ]( r3 b$ r4 }0 R
2 e2 v6 G8 c) N" b1 {6 ]5 S4 j; ` Read his "romance" novel "Tunnel Thru The Air or Looking " Z) c- [0 T9 J8 I& z3 b. s) {& g
Back from 1940" published in 1927. Gann said "Kowledge is more 0 F- j% Y. g8 z+ k m9 H# V( `
important (powerful) than capital" and "Verify EVERYTHING and hold
, y( z3 H+ V: s+ n on to true and good!". |
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