Trading

# Getting Started — Your First 90 Days

*This is a general educational framework. Individual circumstances vary.*

## Week 1-2: Foundation

**Don't open a brokerage account yet.**

1. Pick ONE market to learn (stocks recommended for beginners — most resources available)
2. Learn basic terminology: bid/ask, spread, volume, candlestick charts
3. Understand different order types: market, limit, stop, stop-limit
4. Watch market open/close for a few days without trading

## Week 3-4: Demo Trading

1. Open a demo/paper trading account (most brokers offer these free)
2. Start with $10,000-$50,000 fake money
3. Trade small position sizes as if the money were real
4. Record every trade in a journal: why you entered, where your stop was, outcome

## Month 2: Pattern Recognition

1. Focus on 2-3 chart patterns maximum
2. Practice identifying patterns in real-time (not just hindsight)
3. Track win rate and average win vs average loss
4. If win rate × average win < loss rate × average loss, you're not ready

## Month 3: Small Live Account (Optional)

Only if demo results are consistently profitable:

1. Open account with money you can afford to lose 100%
2. Start with smaller position sizes than demo
3. Expect emotions to interfere — this is normal
4. If you blow the account, return to demo

## How Much Money Do You Need?

| Market | Practical minimum | Notes |
|--------|------------------|-------|
| US Stocks (no day trading) | $500-1,000 | Commission-free brokers help |
| US Stocks (day trading) | $25,000+ | PDT rule requires this for 4+ day trades/week |
| Forex | $500-2,000 | High leverage available but dangerous |
| Crypto | $100+ | 24/7 markets, high volatility |

**Warning:** Starting with more money doesn't improve your odds. Master the skill first with small amounts.

## Red Flags You're Not Ready

- Checking positions constantly
- Unable to accept a losing trade
- Moving stop losses further away hoping for recovery
- Increasing position size after losses
- Trading out of boredom

## Resources

- **Books:** Start with market basics before strategy books
- **Practice platforms:** Most brokers offer paper trading
- **Communities:** Careful of "gurus" selling courses; most profitable traders don't sell education

# Legal Disclaimer & Terms of Use

**Effective Date:** February 2026

---

## IMPORTANT: PLEASE READ BEFORE USING

By using this trading skill ("Skill"), you acknowledge that you have read, understood, and agree to these terms. If you do not agree, do not use this Skill.

---

## 1. NOT FINANCIAL ADVICE

**THIS SKILL DOES NOT PROVIDE INVESTMENT ADVICE, FINANCIAL ADVICE, TRADING ADVICE, OR ANY OTHER FORM OF ADVICE.**

All information, analysis, and outputs are for **general informational and educational purposes only**. Nothing constitutes:

- A recommendation to buy, sell, or hold any security, cryptocurrency, or financial instrument
- A solicitation to engage in any transaction
- Personalized investment advice
- Tax, legal, or accounting advice

The creator is **not** a registered investment advisor, broker-dealer, or financial planner. Not registered with the SEC, FINRA, NFA, CFTC, or any state regulatory authority.

---

## 2. NO FIDUCIARY RELATIONSHIP

Use of this Skill does not create any fiduciary, advisory, or professional relationship. You are solely responsible for evaluating the merits and risks of any trading decision.

---

## 3. RISK DISCLOSURE

**Trading involves substantial risk of loss and is not suitable for all investors.**

- **You could lose some or all of your capital.** Never trade with money you cannot afford to lose.
- **Past performance does not indicate future results.**
- **Markets are volatile and unpredictable.**
- **Leverage amplifies both gains and losses.**
- **No strategy is guaranteed to work.**
- **Technical analysis has limitations.**

---

## 4. USER RESPONSIBILITY

**You are solely responsible for:**

- All trading and investment decisions
- Conducting your own research and due diligence
- Evaluating your financial situation and risk tolerance
- Understanding the products and markets you trade
- Complying with all applicable laws and regulations
- Any tax obligations from your trading activities
- Verifying accuracy of any information before acting

The Skill is a **tool** that provides analysis and information. You make all decisions and bear all consequences.

---

## 5. NO WARRANTIES OR GUARANTEES

The Skill is provided **"AS IS"** without warranty of any kind.

The creator disclaims:
- Any warranty of accuracy, completeness, or reliability
- Any warranty that the Skill will meet your requirements
- Any warranty of fitness for a particular purpose

**No guarantee of profit is made or implied.**

---

## 6. LIMITATION OF LIABILITY

**TO THE MAXIMUM EXTENT PERMITTED BY LAW:**

The creator shall not be liable for any direct, indirect, incidental, special, consequential, or punitive damages, including:

- Loss of profits, income, or capital
- Loss of business opportunities
- Trading losses
- Any other pecuniary loss

**Your total remedy is limited to discontinuing use of the Skill.**

---

## 7. INDEMNIFICATION

You agree to indemnify and hold harmless the creator from any claims, liabilities, damages, losses, and expenses arising from:

- Your use of the Skill
- Your trading or investment decisions
- Your violation of these terms
- Your violation of any applicable law

---

## 8. REGULATORY NOTICES

### United States
Not registered with SEC, FINRA, NFA, or CFTC. Information does not constitute a recommendation under the Investment Advisers Act of 1940.

### European Union
Does not provide "investment advice" as defined under MiFID II. Information is general and does not account for individual circumstances.

### General
Users must comply with all applicable laws in their jurisdiction.

---

## ACKNOWLEDGMENT

**BY USING THIS SKILL, YOU ACKNOWLEDGE THAT:**

1. You have read and understood this disclaimer
2. Trading involves substantial risk of loss
3. You are solely responsible for your decisions
4. This Skill provides analysis only, not personalized advice
5. No guarantee of accuracy or profit is made
6. You will not hold the creator liable for any losses
7. You are of legal age to trade in your jurisdiction

---

**If you do not agree, do not use this Skill.**

# Memory Template

Copy this structure to `~/trading/memory.md` on first use.

```markdown
# Trading Memory

## Profile

Primary market: 
Trading style interest: 
Current stage: demo | live-small | scaling
Risk comfort: conservative | moderate | aggressive

## Learning Progress

### Mastered
<!-- Concepts user demonstrates understanding of -->

### Currently Learning
<!-- Active focus areas -->

### To Explore
<!-- Topics mentioned but not yet covered -->

## Preferences

<!-- Specific preferences learned from conversations -->

## Journal Notes

<!-- Key lessons from trading journal discussions -->
```

## Trade Journal Template

For `~/trading/journal.md`:

```markdown
# Trade Journal

<!-- Format for practice/demo trades:
## YYYY-MM-DD

### Trade 1
- Instrument: 
- Direction: Long / Short
- Entry: [price] at [time]
- Stop: [price] (risk: $X or X%)
- Target: [price] (R:R = X:1)
- Exit: [price] at [time]
- Result: +$X / -$X (X%)
- Notes: Why entered, what went well/poorly
-->
```

## Progress Tracking

For `~/trading/progress.md`:

```markdown
# Learning Progress

## Concepts Covered

| Topic | Date | Confidence |
|-------|------|------------|
| Position sizing | | 1-5 |
| Stop losses | | 1-5 |
| Risk/reward | | 1-5 |
| Chart patterns | | 1-5 |
| Indicators | | 1-5 |

## Milestones

- [ ] Completed demo trading period
- [ ] Consistent demo results (30+ trades)
- [ ] Transitioned to live trading
- [ ] First profitable month
```

## Initial Directory Structure

Create on first activation:

```bash
mkdir -p ~/trading
touch ~/trading/{memory.md,journal.md,progress.md}
```

# Platforms & Regulations

*Broker selection matters. Wrong choice = lost funds, poor execution, or legal issues.*

## Choosing a Broker

**Non-negotiables:**
- Regulated by reputable authority (SEC/FINRA, FCA, ASIC, etc.)
- Segregated client funds
- Transparent fee structure
- Reliable execution (check reviews for outages)

**Important factors:**
- Commission/spread costs
- Available markets
- Platform quality
- Customer support responsiveness
- Withdrawal ease

## Regulatory Bodies

| Region | Authority | Checks |
|--------|-----------|--------|
| US | SEC, FINRA, NFA | brokercheck.finra.org |
| UK | FCA | register.fca.org.uk |
| EU | Varies (CySEC, BaFin, etc.) | National registers |
| Australia | ASIC | asic.gov.au |

**Warning:** Offshore/unregulated brokers may offer better terms but have no investor protection. Many are scams.

## US-Specific Rules

**Pattern Day Trader (PDT):**
- 4+ day trades in 5 business days = PDT classification
- Requires $25,000 minimum equity
- Applies to margin accounts only
- Workarounds: cash account (no margin), offshore broker (risky), multiple accounts

**Wash Sale Rule:**
- Cannot claim tax loss if you buy same/similar security within 30 days
- Affects active traders significantly

## Market-Specific Considerations

**Stocks:**
- Most regulated, most resources available
- Market hours: US 9:30-16:00 ET (pre/post-market available)
- T+2 settlement (cash takes 2 days to clear)

**Forex:**
- 24/5 markets (Sunday evening - Friday evening)
- Less regulated in many jurisdictions
- High leverage commonly offered (dangerous)
- Spreads widen during low liquidity (Asian session for EUR/USD)

**Crypto:**
- 24/7 markets, no breaks
- Regulation varies wildly by country
- Exchange risk: platforms can freeze funds, get hacked, go bankrupt (FTX)
- Consider self-custody for holdings

**Futures/Options:**
- Complex products, require additional approvals
- Can lose more than deposit
- Expiration dates, exercise rules, Greeks (options)

## Fee Types

| Fee | What it is | Watch for |
|-----|------------|-----------|
| Commission | Per-trade charge | $0 common but hidden in spread |
| Spread | Difference bid/ask | Main cost in forex |
| Overnight/swap | Holding cost overnight | Kills swing trades in forex |
| Inactivity fee | Charged if not trading | Read fine print |
| Withdrawal fee | To get your money out | Some brokers punish withdrawals |

## Red Flags

- Promises of guaranteed returns
- Unregulated jurisdiction (St. Vincent, Marshall Islands)
- Bonus structures that lock funds
- Difficulty withdrawing
- Pressure to deposit more
- "Account managers" making trades for you

## Tax Considerations

**General principle:** Trading profits are taxable. Frequent trading often taxed at higher short-term rates.

- Keep records of all trades
- Consider tax software or accountant
- Some jurisdictions allow trader tax status (US Section 475)
- Crypto tax reporting is complex and actively enforced

*Always consult a tax professional for your specific situation.*

# Risk Management

*Risk management determines survival. Good entries with bad risk management = eventual ruin.*

## Position Sizing

**The 1-2% rule:** Never risk more than 1-2% of account on a single trade.

**Calculation:**
```
Risk amount = Account × 1%
Position size = Risk amount ÷ (Entry - Stop loss)
```

**Example:** $10,000 account, 1% risk = $100 max loss per trade.
If entry is $50 and stop is $48 (risk $2/share):
Position = $100 ÷ $2 = 50 shares maximum.

## Stop Loss Placement

**Rules:**
- Set stop BEFORE entering trade
- Place based on technical levels, not arbitrary percentages
- Never move stop further from entry (only closer to lock profits)
- Accept that stops will sometimes trigger before reversals

**Stop types:**
- **Hard stop:** Order placed with broker, executes automatically
- **Mental stop:** You commit to exit at price (unreliable — use hard stops)
- **Trailing stop:** Moves with price to lock in gains

## Risk/Reward Ratio

Minimum 1:2 means potential profit is 2× potential loss.

| Win Rate | Required R:R to Break Even |
|----------|---------------------------|
| 50% | 1:1 |
| 40% | 1:1.5 |
| 33% | 1:2 |
| 25% | 1:3 |

**Reality:** Most traders have 40-50% win rates. You NEED favorable R:R to be profitable.

## Drawdown Management

**Drawdown:** Peak-to-trough decline in account value.

| Drawdown | Required Gain to Recover |
|----------|-------------------------|
| 10% | 11% |
| 20% | 25% |
| 30% | 43% |
| 50% | 100% |

**Rules:**
- If down 10% in a day/week, stop trading and review
- Consider reducing position size during drawdowns
- Have a "circuit breaker" — maximum daily/weekly loss before stopping

## Correlation Risk

Five "different" trades in correlated assets = one large bet.

**Examples of hidden correlation:**
- Tech stocks move together
- AUD/USD, NZD/USD, and copper often correlate
- Crypto markets are highly correlated

**Solution:** Limit exposure to correlated positions.

## Leverage

**What leverage does:**
- 10:1 leverage = $1,000 controls $10,000 position
- Gains amplified 10×
- Losses amplified 10× (can exceed deposit)

**Margin call:** Broker forces position closed if losses approach deposit.

| Leverage | Move against you | Your loss |
|----------|-----------------|-----------|
| No leverage | -10% | -10% |
| 5:1 | -10% | -50% |
| 10:1 | -10% | -100% (wiped) |

**Rule:** New traders should use minimal or no leverage until consistently profitable.

## Psychology Integration

- **Pre-trade:** Know exact entry, stop, target before clicking
- **During trade:** Do not stare at screen — you'll intervene badly
- **After loss:** Log it, analyze it, move on. No revenge trades.
- **After win:** Don't increase size immediately. Wins breed overconfidence.

# Setup — Trading

## First-Time Setup

### 1. Acknowledge Disclaimers

Before proceeding, read `legal.md` and acknowledge that:
- This is educational content only
- Nothing constitutes financial advice
- User is responsible for their own decisions
- Consulting licensed professionals is recommended

### 2. Create Memory Structure (Optional)

If user wants to track learning progress:

```bash
mkdir -p ~/trading
```

### 3. Initialize Memory (Optional)

Create `~/trading/memory.md` using the template in `memory-template.md`.

## Configuration

No mandatory configuration required. The skill works from minute zero.

Optional preferences to capture over time:
- Primary market focus (stocks, forex, crypto)
- Current learning stage (demo, small live, scaling)
- Trading style interest (day trading, swing, position)
- Risk tolerance preferences

## Without Setup

Skill works immediately with defaults:
- Assumes beginner level
- Covers all markets equally
- Uses conservative risk examples (1% per trade)
- No progress tracking

## Workspace Integration

If user has a main `AGENTS.md` or `USER.md`, consider adding:

```markdown
## Trading Education

Currently learning: [market] trading
Stage: Demo / Live (small) / Scaling
Focus: [style]
```

This helps the agent tailor content across sessions.

---
name: Trading
slug: trading
version: 1.0.1
homepage: https://clawic.com/skills/trading
changelog: Added setup.md, memory-template.md, enhanced guardrails, and legal disclaimers following SEC/NFA patterns.
description: Trading analysis and education. Technical analysis, chart patterns, risk management, and position sizing for stocks, forex, and crypto.
metadata: {"clawdbot":{"emoji":"📈","requires":{"bins":[]},"os":["linux","darwin","win32"],"configPaths":["~/trading/"]}}
---

## Guardrails

**On first use:** Show user `legal.md` disclaimers and ask them to acknowledge before continuing.

### Language Rules

**NEVER use:**
- "Buy X" / "Sell X" / "You should..." (direct imperatives)
- "I recommend..." / "My advice is..."
- "This will go up/down" (predictions as fact)
- "Guaranteed" / "Risk-free" / "Sure thing"
- "Based on your portfolio..." (personalized advice)

**ALWAYS use:**
- "Technical analysis shows..." / "The chart indicates..."
- "Traders often consider..." / "One approach is..."
- "Historical patterns suggest..." / "Backtests show..."
- "If a trader wanted to [goal], they might..."

### What This Skill CAN Do

✅ Technical analysis and chart pattern identification
✅ Explain indicators (RSI, MACD, moving averages, Bollinger)
✅ Analyze support/resistance levels and price action
✅ Calculate position sizes given user's risk parameters
✅ Backtest strategies on historical data
✅ Market summaries and sentiment analysis
✅ Explain trading strategies and their pros/cons
✅ Risk/reward calculations and trade planning
✅ Educational content about any trading concept

### What This Skill Must NOT Do

❌ Direct "buy/sell" recommendations as imperatives
❌ Personalized portfolio advice based on user's situation
❌ Guarantees of profit or accuracy
❌ Tax or legal advice
❌ Execute trades on user's behalf

### Response Pattern

When user asks "Should I buy X?":
> "I can't tell you what to buy—that's your decision. But I can analyze X's technical setup. Looking at the chart: [analysis]. Key levels traders watch: [levels]. The decision is yours based on your research and risk tolerance."

**Escalate to professional:** User mentions life savings, retirement funds, borrowed money, or gambling behavior.

## Setup

On first use, read `setup.md` for integration guidelines.

## When to Use

User wants trading analysis or education. Technical analysis, chart patterns, indicator readings, risk management calculations, position sizing, strategy explanations, market analysis, forex/crypto/stock concepts, or trade planning assistance.

## Architecture

Memory lives in `~/trading/` with learning progress tracking.

```
~/trading/
├── memory.md        # Preferences, trading style, focus areas
├── journal.md       # Trade journal for review
└── progress.md      # Concepts mastered vs learning
```

## Quick Reference

| Topic | File |
|-------|------|
| Setup | `setup.md` |
| Memory template | `memory-template.md` |
| Getting started | `getting-started.md` |
| Risk management | `risk.md` |
| Technical analysis | `technical.md` |
| Platform evaluation | `platforms.md` |
| Legal disclaimers | `legal.md` |

## Core Rules

### 1. Analysis Over Advice
Provide deep analysis, let user decide. "The chart shows X" not "You should do X". Same depth, different framing.

### 2. Risk First
Discuss risk management before any strategy. Position sizing and stop losses come before entries and targets.

### 3. Conditional Language
Frame outputs as what "traders consider" or "historical patterns suggest", never as predictions or guarantees.

### 4. No Suitability Claims
Never imply something is right for the user specifically. All analysis is general, not personalized to their portfolio.

### 5. Brief Disclaimers
Include natural reminders in substantive analysis: "Remember, this is analysis, not a recommendation" or "Past patterns don't guarantee future results."

## Trading Styles

| Style | Timeframe | Characteristics |
|-------|-----------|-----------------|
| Scalping | Seconds-minutes | Full attention required |
| Day trading | Intraday | Close positions by EOD |
| Swing trading | Days-weeks | Overnight exposure |
| Position trading | Weeks-months | Fundamental + technical |

## Technical Analysis Basics

Studies price/volume patterns. Probabilistic, not predictive.
- Chart patterns (head & shoulders, flags, triangles, wedges)
- Indicators (RSI, MACD, moving averages, Bollinger Bands)
- Support/resistance levels and breakouts
- Multi-timeframe analysis
- Candlestick patterns

For patterns and indicators, see `technical.md`.

## Risk Concepts

- **Position sizing** — Calculate based on account risk % and stop distance
- **Stop losses** — Predetermined exit points, never move further away
- **Risk/reward** — Minimum 1:2 for most strategies
- **Drawdown management** — Circuit breakers after losing streaks
- **Correlation risk** — Multiple correlated positions = one large bet

For calculations and details, see `risk.md`.

## Common Traps

| Trap | Consequence |
|------|-------------|
| No predetermined exit | Single trades can wipe gains |
| Excessive leverage | Amplifies losses beyond deposits |
| Overtrading | Costs and emotions compound |
| No written plan | Random entries, poor results |
| Revenge trading | Compounds drawdowns |
| Moving stops further | Turns small losses into large ones |
| Ignoring position size | Risk per trade too high |

## Scope

This skill ONLY:
- Provides trading analysis and education
- Stores preferences in `~/trading/`
- References its auxiliary files

This skill NEVER:
- Executes real trades
- Accesses brokerage accounts
- Provides personalized financial advice
- Makes guaranteed predictions

## Related Skills
Install with `clawhub install <slug>` if user confirms:
- `invest` — long-term investing fundamentals
- `money` — personal finance basics
- `crypto-tools` — cryptocurrency utilities
- `business` — business strategy and planning

## Feedback

- If useful: `clawhub star trading`
- Stay updated: `clawhub sync`

# Technical Analysis Basics

*Technical analysis studies price/volume to forecast moves. It's not predictive — it's probabilistic.*

## Chart Types

| Type | Shows | Best for |
|------|-------|----------|
| Candlestick | Open, high, low, close | Most trading styles |
| Line | Closing prices only | Long-term trends |
| Bar (OHLC) | Same as candle, different visual | Some prefer for clarity |

**Candlestick anatomy:** Body shows open→close, wicks show high/low. Green/white = closed higher, red/black = closed lower.

## Timeframes

| Timeframe | Used by | Context |
|-----------|---------|---------|
| 1-5 min | Scalpers | Noise-heavy, fast decisions |
| 15-60 min | Day traders | Intraday structure |
| 4H-Daily | Swing traders | Cleaner signals |
| Weekly-Monthly | Position traders | Big picture only |

**Multi-timeframe rule:** Analyze higher timeframe for direction, lower for entries.

## Key Patterns

**Continuation (trend likely continues):**
- Flags/pennants — Brief consolidation after strong move
- Triangles — Compression before breakout

**Reversal (trend may change):**
- Head & shoulders — Three peaks, middle highest
- Double top/bottom — Two tests of same level fail

**Caution:** Patterns fail often. Never trade pattern alone without stop loss.

## Common Indicators

| Indicator | What it shows | Trap |
|-----------|---------------|------|
| Moving averages (MA) | Smoothed price trend | Lags — late signals |
| RSI | Overbought/oversold | Can stay extreme during trends |
| MACD | Momentum + trend | Many false crosses |
| Volume | Trade activity | Interpretation varies |

**Indicator overload:** More indicators ≠ better decisions. Most traders use 2-3 maximum.

## Support & Resistance

- **Support:** Price level where buying has previously emerged
- **Resistance:** Price level where selling has previously emerged
- Levels are zones, not exact numbers
- Broken resistance often becomes support (and vice versa)

## What Technical Analysis Cannot Do

- Predict with certainty (nothing can)
- Account for news events or black swans
- Work in isolation — requires risk management
- Replace a trading plan

## Common Beginner Mistakes

1. Drawing too many lines — charts become unreadable
2. Fitting patterns after the fact (hindsight bias)
3. Ignoring timeframe context
4. Believing indicators are signals (they're inputs, not answers)

{
  "ownerId": "kn73vp5rarc3b14rc7wjcw8f8580t5d1",
  "slug": "trading",
  "version": "1.0.1",
  "publishedAt": 1772034919239
}