Gann states that to make a success in trading stocks you must get the knowledge first. You must learn before you lose. Many traders go into the market without any knowledge and lose a large part of their capital before they learn it is necessary to go through a period of preparation before they start trading.
A thorough understanding of Ganns material beginning with his books through to the Commodity Course is required to understand how he was applying his methods and what Squares and Calculators he was using for certain stocks and commodities. After reading through Ganns material taking notes then constructing hand-drawn charts and Tables you will begin to decipher what he was doing and from there you can work your way onto his recommended reading list which contains a book on Astronomy and several Numerological titles.
Gann states that Times and conditions change over the years and you must learn to change with them. Human nature does not change and that is the reason History repeats and stocks act very much the same under certain conditions year after year in the various cycles of time.
When planning a trade it is important to realize that you can be wrong and managing and correcting small losses in the market is a normal aspect of business. Having a clear trading plan drawn up before entering the market is crucial as it will reduce stress and anxiety and your thinking is always at its clearest when you are out of the market pre-calculating a trade. A trading plan will allow you to follow and act on a clear set of rules when your judgement is clear providing you with a roadmap to follow including risk strategy and stop-loss placement. this aspect is very important as we can all be wrong and accepting small losses are a normal part of business. Always have a stop-loss set before you enter the trade and be prepared to act on it if required. If you are not disciplined to act it may be prudent to engage a Broker where you can give him all of the trade details and parameters before entering the market and instead of you making the decision to close out the position he can do it for you automatically. this is a wise strategy it may cost a little extra but it reduces stress and outsources the stop loss decision to your broker which is an automatic function for him.
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