Now I have time. Follow these small rules and you will make more money than holding SIRI and riding its ups and downs:
The point of trading is to turn a profit, so why put money in a stock that is not moving? Doing so would mean risk without reward. Furthermore, an open position showing a loss should be cut immediately because small losses are the KEY. Your objective is to expect profits that outweigh expected losses by at least a 3:1 ratio. Losses are a part of the game, so you must respect them and keep them small. Therefore, only get in stocks on the move with the intention to ride them into profits and exit upon the loss of momentum. It is at this point in the trade that we TAKE THE MONEY AND RUN!!
Be in no hurry to put on trades. Trades placed out of boredom lead to bad habits and poor results in the long run. This leads to a loss of trading confidence, which is even more damaging than losing dollars!
Over time (weeks, months, years), be absolutely sure to keep your down days and weeks as small as possible. Growing your account happens when you stay in winners while they run, and cut losers at the first sign of negativity. Big winners are not for offsetting big losers. Wealth comes from big winners, so keep the losers small.
TRADING STRATEGY - HAVE YOU DEFINED YOUR TIME FRAME ?
I know, I know, you are an "investor". Honestly, that is BS.
If you really want to make money, first of all, decide your timeframe for trading or "investing" ("I am on it for the long run", " I am on it for 1, 2 or 3 years", "I will retire before I sell", "I am a long term investor", etc... DO NOT COUNT). This is important because it not only determines position sizing, but also where to get out of your positions. Deciding which approach works for you will help you to determine which exit strategy fits your "investing" plan best.
Regardless of which timeframe you pick, the key is to keep your risk profile for every position in check.
THE FOLLOWING IS MY "SEXY" SWING TRADING STRATEGY... as you called it:
When swing trading, your position size will usually be smaller than when day trading due to the fact that you are looking for a larger move. Your stop loss orders should be placed wider than when day trading for this reason. Naturally, your profit targets are farther away, so patience is a necessity.
Stocks often gap, so here are some guidelines for swing trading:
If a stock gaps 1-2%, enter 1/2 of the intended position size and monitor the stock's behavior before adding to the position.
If a stock gaps 2-3%, only enter 1/4 of the intended position size.
If a stock gaps over 3%, it may be best to pass on the trade entirely, as the risk/reward profile of the trade is no longer the same.
Here are a few rules of thumb to help determine exits when swing trading:
If the prior day's low is taken out on the breakout day (or high for shorts), exit the trade.
Once a trade is held overnight, place a stop-loss order no further away than below the recent consolidation area, as a move beneath it would signal a failure.
Once a trade is profitable by at least 10%, never give back more than half of the open profit. This helps to avoid the frustration of letting winning trades turn into losing trades.
Once a trade is profitable by at least 5%, move the stop-loss order to breakeven on a closing basis.
Partial buys and sells can be very helpful. If a stock breaks out in a sluggish fashion, consider entering only a partial position. If a trade is exhibiting little follow-through after the breakout, decrease the position size.
Always monitor the health of the overall market, and the health of your positions. When things aren't acting right, either lighten up or go to cash entirely to preserve capital. It's easy to get back in!
These are some general guidelines for any trader with a swing trading strategy to determine exits that fit their timeframe, and are intended for educational purposes only as you seek to define a swing trading strategy that suits your needs.