There is lot of non specific advice in the market like follow the trend , buy high sell high and many other rules. But for a new trader those things are not much of a use because it does not solve his problem of how.
How do I find strong stocks or trending stocks. How do I buy high sell high. That how is important. That is the real meat.
To go from rules or general advice to specific plan you need a specific step by step guide. Good setups provide you that. They answer the question what 4 or 5 things should I do if I am to follow your non specific advice buy higher and sell higher. They answer the question how do I calculate relative strength. How do I find precise buy points. Or what should be the volume on breakout day. In short a good setup provides you a template for trading. That is extremely valuable to a new trader.
That ability to break down a setup in to trading method is where lot of struggle is in learning to trade. It is the nuts and bolts of the trading business that are difficult. Conceptually you can get a setup by reading about it but to convert to step wise instruction for yourself is where the gap is.
Once you find your first fully developed template or design it yourself, you climb a major mountain. Because then you can create hundreds of iterations to improve on your prototype method or you can use the learning to design other setup ideas.
Let us say if you read the book on market breadth, it has lot of good ideas or concepts but it does not have tradable setup templates. How do I actually use the breadth on day to day basis is not something it provides. That leap from a setup concept to a workable setup you have to do yourself.
Market Monitor is a setup which I developed from scratch after reading about market breadth and how others were using the breadth. It has step wise how to do it. That is why you will see so many members and past members have taken that template and created their own setup around it. Same is true of STIB.
So when you are new trader or struggling trader and looking for setups look for setup template rather than non specific rules.
Reproduced from the Stockbee members site. On the members site there is more extensive discussion on these setups and how to set them up in Telechart.
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