What are support and resistance of a stock?
"Support and resistance points indicate price levels where there have been a large amount of trading activity, usually from institutions, that tend to stabilize the price of a stock. Support is a temporary FLOOR, where people have been buying in large quantities. That means there's a good chance that the stock won't go below this level in the near term. (But if it does, watch out.) Resistance is a temporary CEILING where people have been selling. When the stock price hits this level, people tend to sell, and push it back down. Until there are ""no more"" sellers at this level. Then the price could skyrocket if there is enough buying." You should check out existing resources like Investopedia for definitions, and ask questions if there is something you do not understand, instead of asking folks to spit out definitions. A good book for you to read might be Wall Street Words
Support and resistance only works as a self-fulfilling prophecy. If everyone trading that stock agrees there's a resistance at so-and-so level, and it is on such-and-such scale, then they will trade accordingly and there will really be a support or resistance. So while you can identify them at any time scale (although as a rule the time scale on which you observed them should be similar to the time scale on which you intend to use them), it's no matter unless that's what all the other traders are thinking as well. Especially if there are multiple possible S/P levels for different time scales, there will be no consensus, and the whole system will break down as one cohort ruins the other group's S/P by not playing along and vice versa. But often fundamentals are expected to dominate in the long run, so if you are thinking of trades longer than a year, support and resistance will likely become meaningless regardless. It's not like that many people can hold the same idea for that long anyhow. When using the Stochastic Indicator your basic aim is to buy (go long) when the stochastic becomes oversold (goes below 20%) and then the %K line crosses above the %D line at a market low, and to sell (go short) when the stochastic becomes overbought (goes above 80%) and then the %K line crosses below the %D line at a market high. Other indicators or candlestick patters can also be used to further confirm the trade. Below is a chart of a trade I recently took on GUD.AX using the Slow Stochastic in combination with support and resistance levels as well as a candlestick pattern.  When I conducted my stock search on the evening of 28th July 2015, GUD was one of the results from the search that I particularly liked. The Slow Stochastic had just made a crossover in the oversold area just as the price was bouncing off its recent lows at the support line. But what I really like about this opportunity was that there was also a bullish reversal candle (a Hammer) at this short term market bottom. The high for the day was $8.34, so I placed a stop buy order to buy the stock tomorrow if the price opened or moved above this high of today. So I would only buy if the stock hit or moved above $8.35 during the next days trading. So if the stock opened and stayed below the previous day's high I would not buy the stock and my order would be canceled at the end of the day. This is very important because it stops you from getting into trades that don't go in the direction you want. If this happens then you could check the chart again after market close to see if it is still worthwhile to place a new order for the next day. On the 29th July 2015 the stock did open higher at $8.42 (which is where my order got executed) and closed at $8.46. So I ended up buying slightly above my target price but it did move higher on the day, so a successful entry overall. I had placed my initial stop loss at $8.09 (just below the low of the previous day of $8.10). If the trade had gone against me in the following days the most I would have lost was 1% of my total account capital. My target for this trade was $9.86 (just below the resistance line near $10), which would represent a 5% gain against my total account capital (or approx. 16.7% gain on the trade). So my win to loss ratio was 5:1. As you can see from the chart, the next day gapped up at the open and prices continued moving up strongly during the day. The next day was a slightly negative day, and then a few days later, on the 5th August 2015 my target price of $9.86 was reached (with a high of $9.88 for that day), so my order was closed for a total profit of 16.7% on the face value of the trade. However, as I bought on margin (using CFDs) my actual profit on the initial margin I had invested was 167%. My total time in the trade was 7 days, and I spent about an hour in the evening doing my searches and placing my orders, then less than 10 minutes managing the trade each evening after market close. The stock did go up a bit further after my profit target was reached, but the day after that the price started to fall as the price hit the resistance line and the Slow Stochastic did a crossover in the overbought area. Overall, this was a very ideal trade and I was very happy with it. Not all my trades reach my profit targets and I may get stopped out at a smaller profit or I might make a small loss (as I move my stops up as the price moves up). The key to successful trading over the long term is to keep you losses small and let your profits run (with my longer term trend trading I don't have profit targets and let my profits run until I get stopped out, but with my shorter term trading I do use a profit target usually 5 or 6 times the size of my initial stop). If you have an average win to average loss ratio of 3:1 or higher and have a success rate of 50% winners you will make money over the long term. The problem is cutting Social Security is a great way to not get reelected.  So congress will resist doing this no matter what.  I fear they might rather push the country to the verge of bankruptcy rather than cut Social Security. I think most financial planners or advisors would allocate zero to a gold-only fund. That's probably the mainstream view. Metals investments have a lot of issues, more elaboration here: What would be the signs of a bubble in silver? Also consider that metals (and commodities, despite a recent drop) are on a big run-up and lots of random people are saying they're the thing to get in on. Usually this is a sign that you might want to wait a bit or at least buy gradually.  The more mainstream way to go might be a commodities fund or all-asset fund. Some funds you could look at (just examples, not recommendations) might include several PIMCO funds including their commodity real return and all-asset; Hussman Strategic Total Return; diversified commodities index ETFs; stuff like that has a lot of the theoretical benefits of gold but isn't as dependent on gold specifically. Another idea for you might be international bonds (or stocks), if you feel US currency in particular is at risk. Oh, and REITs often come up as an inflation-resistant asset class. I personally use diversified funds rather than gold specifically, fwiw, mostly for the same reason I'd buy a fund instead of individual stocks. 10%-ish is probably about right to put into this kind of stuff, depending on your overall portfolio and goals. Pure commodities should probably be less than funds with some bonds, stocks, or REITs, because in principle commodities only track inflation over time, they don't make money. The only way you make money on them is rebalancing out of them some when there's a run up and back in when they're down. So a portfolio with mostly commodities would suck long term. Some people feel gold's virtue is tangibility rather than being a piece of paper, in an apocalypse-ish scenario, but if making that argument I think you need physical gold in your basement, not an ETF.  Plus I'd argue for guns, ammo, and food over gold in that scenario. :-) "The question mentions a trailing stop. A trailing stop is a type of stop loss order. It allows you to protect your profit on the stock, while ""keeping you in the stock"". A trailing stop is specified as a percentage of market price e.g. you might want to set a trailing stop at 5%, or 10% below the market price. A trailing stop goes up along with the market price, but if the market price drops it doesn't move down too. The idea is that it is there to ""catch"" your profit, if the market suddenly moves quickly against you. There is a nice explanation of how that works in the section titled Trailing Stops here. (The URL for the page, ""Tailing Stops"" is misleading, and a typo, I suspect.)" Nifty Tips 23 dec,stock tips 23 dec, NIFTY VIEW WITH SUPPORT AND RESISTANCE LEVEL FOR TOMORROW 23 Dec(NIFTY TREND):-Weak note opening took a u turn and closed at day high at 4734, up 41 points.Nifty has resistance level at 4801 and last resistance level at 5000.47 and support at 4602.07 and last support at 4402.87 for tomorrow Nifty. Dummy example to explain this. Suppose your portfolio contained just two securities; a thirty year US government bond and a Tesla stock. Both of those position are currently valued at $1mm. The Tesla position however is very volatile with its daily volatility being about 5% (based on the standard deviation of its daily return) whole there bond's daily volatility is 1%. Then the Tesla position is 5/6 of your risk while being only 1/2 of the portfolio.   Now if in month the Tesla stock tanks to half is values then. Then it's risk is half as much as before and so it's total contribution to risk has gone down. I don't know too much about the kelly criterion, but going by the other answers it sounds like it could be quite risky depending how you use it. I have been taught the first thing you do in trading is protect your existing capital and any profits you have made, and for this reason I prefer and use Position Sizing (PS). The concept with PS is that you only risk a small % of your capital on every trade, usually not more than 1%, however if you want to be very aggressive then not more than 2%. I use 1% of my capital for every trade. So if you are trading with an account of $40,000 and your risk R on every trade is 1%, then R = $400. As an example, say you decide to buy a stock at $10 and you work out your initial stop to be at $9.50, then our maximum risk R of $400 is divided by the stop distance of $0.50 to get your PS = $400/$0.50 = 800 shares. If the price then drops after your purchase, your maximum loss (subject to no slippage) would be $400.  If the price moves up you would raise your stop until your potential loss becomes smaller and smaller and then becomes a gain once your stop moves above your initial purchase price. The aim is to make your gains be larger than your losses. So if your average loss is kept to 1R or less then you should aim to get your average gains to 2R, 3R or more. This would be considered a good trading system where you will make regular profits even with a win ratio of 50%.