Saturday, 17 October 2009

Interview with trader: Don Henry

Question: What has been your experience in the trade?

Don: I started to trade shares after college in the early 1970's, and sold all the running for many years. I put more emphasis on positional trade in grain, currency and make some trade-in e-mini and bond recently.

Question: What hardware do you use?

Don: I use two computers, one of which - a laptop. Both computers have dual displays. The main computer - 500 MHz, 128 MB, with 2 monitors, trading platform - Ensign Windows. Get real-time data via satellite.

Question: Tell us about your brokerage business?

Don: I've been a broker since 1986. and started with Dean Witte. I became an independent broker in 1990. I have clients in 7 or 8 states and a number of active clients abroad (Brazil). While in North Dakota, many of my clients' fixed-term contracts are traded on the livestock and grain. Fees range from $ 25 to $ 40 for full service. Full-service portfolio includes support, advice, training and explanation of technical analysis. Some clients also want to receive recommendations. Many of my clients are traded with me for 10 - 15 years.

Question: Does your favorite types of analysis and tools to which you reliance?

Don: Yes. I recommend that my clients have read 2 or 3 books. I recommend them to read books by Bill Williams Trading Chaos "and" New dimensions of trade. " I also like Joe DiNapoli book "Trading with DiNapoli levels. These books included in the list in ascending order of their complexity and involvement. Also, I recommend the "disciplined trader" Mark Douglas. My favorite tools - it is Moving averages and the old reliable index of relative strength (RSI). I use a sliding average method, which uses them, Bill Williams, including convergence / divergence of moving averages (MACD). Most of the time I have RSI in their schedules. Discipline the use of stop orders and the management of capital are key to the trade. I do not want it sounded as though I have all the answers. I am always working to improve its consistency. I admit that from time to time, I go too hot.

Question: Does your favorite image formation, which do you think?

Don: There are two formations, which I am looking for - "head and shoulders, and the model of" 1-2-3 "at the base and top. Model "1-2-3" in the ground can be described as having a 1 at the base, a strong leap up to a point 2 and No 3 to the point, but without breaking point 1. My level of purchases will be up when passing through the point 2. Basically, I traded for a breakthrough. In the model of "head and shoulders" I traded with the break through the neck and also use the model to measure the price objective of equal distance from the neck to the top of the head.

Question: What kind of drops you have learned to avoid?

Don: For many years I can see Traders who try to escape from the difficult situation, thinking that it can not become worse. But it happens. The lesson seems to be explored again and again. It concluded with us when we fight with the markets and resist what we see. The correct philosophy is to "see it, believe it and trade it." This is a mistake - to impose their own ideas on the market. Another rule that I use - I did not add to a losing position. I acknowledge that I have done so, but it is very dangerous - to attempt to averaged a losing position. Traders are often forced to leave the loss-making positions at the request of the deposit (margin call).

Question: What is an interim format you use for your charts?

Don: I primarily use ticks and schedules for all Fibonacci numbers. For example, I use 34 - and 55 - ticks graphics for e-mini, which are often converted into 3-minute bars. To market the grain, I use 13 - or 21-ticks graphics, which are often converted into 7-minute schedules. For longer periods of time I watch 30-minute charts and then convert them back into the schedule ticks closest to the Fibonacci numbers. You can get ticks by for use by exploring the volume of a 30-minute schedules about 5 different points on average per day. If the 30-minute bars volume will be an average of 150 ticks, I would use 144-ticks schedule as his long-time period for the schedule.

The first thing I do every morning - I look at their daily and weekly charts to get a big picture. I like to trade towards a greater time period such as 144 - or 233-teak schedule. I traded on the schedule with a shorter period of time, but only in the direction of the schedule with the next big format.

Question: How often do you sell?

Don: With intra-day trading on the e-mini, and I'm trying to reduce their transaction. But I still sold 10 - 20 times a day for 55 ticks schedule. My main instruments - is Moving averages, MACD and RSI. I have a feed, using a sliding average as the maximum and the Moving Average as a minimum. I use a sliding average, like Alligator, described in the book Williams. I'm using longer Moving averages, for example, with the parameters 21 and 55 for high and low channels, because the volatility in these markets has increased. I also hold a 200-periodnuyu Moving averages at all time formats that focus on the direction of the market.

Question: What constitutes a successful sale for you?

Don: When you trade on the e-mini, I try to stay in the market and use of a mobile stop-order. One rule that I use - it is after the 10-point gains, I fixed portion of the profits. The same principle is used and with the grain. I, first, try to capture some profits and, secondly, I'm trying to market to move, giving him some space.

Question: What are the market conditions you're looking for?

Don: I love the trend markets, but markets are in a trend, only 30% of the time, and variable - 70% of the time. I would only be a trend in the markets, but it is difficult to predict when a trend. I love the Elliott Wave count in order to find 1-2-3-4-5 Elliott model and be on board during the 3rd movement of waves. I generally avoid the bottom and tops, but I like to trade in the 3rd wave. Although it is sometimes difficult to find what I am looking for. I do not like to be in the market during a speech by Mr. Greenspan. I prefer to stay out of the game, when the markets are subject to considerable variability.

Question: Do you use any risk management and money management techniques?

Don: I must emphasize the use of stop orders. If you can not find an acceptable level for the stop-order, taking into account your tolerance for risk, then miss a bargain. Do not risk more than 2 - 3% of your trading capital in any one transaction.

Q: What advice can you give to beginners?

Don: My advice is to go very slowly and make small changes. Pay attention to profitability. If there is a high yield, it means that there is a high risk. Start with low-income and low-risk market-based instruments, which have high liquidity. Before we begin the real trade potreniruytes for educational accounts. If you feel that you can make money on the market, selling educational accounts, you start to trade on the real small amounts.

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