World's Simplest (Winning) Trading System

Want the world's simplest (Winning!!) trading system? I'll give it to you. (I'm just in a generous mood.)

I actually got this from Bill Gallaher, years and years ago - but it still works like a ridiculously simple charm. Amazingly, very few people will take advantage of a simple trading system like this, just BECAUSE it's so simple - they want something complicated, something you need a computer to use. Here's a dollar - buy a clue: Complicated doesn't automatically mean "better".

I used this system as my primary trading strategy when I first started out as a trader, primarily because I was too ignorant of the markets to be able to reliably use anything else. With it, I made an average monthly return of 15-20% my first year as a full-time trader (that comes out to about 200% profit for the year). And I assure you that I was not "lucky". If anything, I was unlucky, whenever there was a part for luck to play. For example, if I had to decide whether to buy gold or silver, I invariably bought the one that didn't make the most dramatic move. Nonetheless, operating in a commodities market that was all but dead, I made very good money.

And here's how I did it: I bought if the market made a new high based on the last ten trading days. I sold if the market made a new low. I put my stop-loss orders just outside the previous ten-day trading range. Additionally, I never entered a trade where my initial risk was more than $1,000 (and I really tried to keep it down around $500). That is, if the previous 10-day trading range was so wide that I would have had to place my stop at a point that could have resulted in more than a $1,000 loss, then I didn't do the trade.

That's it. The only caveat was that I followed the very, very smart rule of "higher high or lower low" when looking to re-enter a market that I'd been stopped out of for a loss. If I got stopped out after selling short, I would only initiate a new short position in that market if the market reached a lower low than the point at which I'd originally sold short. If you test this system out (go back and look at how it would have done), you'll see that that one simple rule makes a world of difference in total profitability.

This is obviously not a system that will work well in an extremely volatile market, but overall, month in and month out, I've found very few strategies that can consistently outperform it.

Sometimes, simple is best.

For some great trades on the board right now, CLICK HERE FOR INSIDE INFO.