Wednesday, September 15, 2010

Wealth & Trading

Wealth & Trading

Been involved with this and it has been a pretty amazing experience.

Been in the free trial week and it has been moving experience. Don’t worry if you missed these, this was not sort of one time experience that’s not replicatable and I’m not talking about the winning trades. Jason has been doing some thinking about trading, wealth, etc. There’s probably a lot of people that won’t get it, this is not some new kabuke indicator. He has fused stuff from Tony Robbins with the world of trading so, for me, it’s all doubly powerful.

The question is: what kind of thinking is involved if you are really going to dare be a professional trader? Nobody has really addressed this .. until now.

Tuesday, September 14, 2010

Taking a Bit of a Breather

Well not really.  Spending two weeks with Jason Stapleton at in his free two week class.  I've resolved to really professionalize my trading I'm going to hammer out my system and test it before taking any more live trades.

Also, I'm in the midst of switching brokers so more on that later.

Thursday, September 9, 2010

Wednesday, September 8, 2010

Should I use a Trading Goal

From The Trading Zone

The question of whether or not to set a daily financial goal in your trading has come up more times than I can count.

Whether it be in the chat room or member training, it is a trading topic that comes up all the time.

Simply put, trading without a goal is akin to competing in a sporting event without keeping score. At the close of the market the bell is rung, the competition ends and everyone tallies their points or counts their profits (or loss).

While traders are often told and taught to trade without emotion, it is specifically the emotion of fear of loss that can keep a trader out of trouble.

In my opinion and in my experience every trader should set a reasonable and achievable daily goal and stop (or adjust) trading once their goal is achieved.

Newer traders should set a goal low enough so that it can easily be achieved 4 of 5 trading days. That goal can be as low as 1 or 2 points.

While stopping to trade once a goal is reached may not be the way to maximize profits in the short term, it will serve to dramatically increase profitability in the long run.

Too often I have seen a trader earn substantial profits from the morning trade, profits great enough that when annualized would place the trader securely in the 15 % of consistently profitable traders, only to see them return those profits to the market in the afternoon session.

So where is the downside of setting a goal and moving to a sim account.

Ego and poor guidance in my opinion are the culprits. A trader who says ‘I am playing with the houses money’ as a justification to risking an entire day of profits in my opinion has adopted a gamblers mentality that will destroy a trading career.

A trader who asserts that the market has not yet reached it’s low or high for the day and must therefore keep trading, has put his ego before his profits.

What matters at the end of the day, is that you have more money in your trading account than you started with.

What matters is what You are doing and not what the market is doing.

If the market rallies 50 points but you are not in the trade, then the move is irrelevant to your p/l.

If the market moves just 3 points and you grab those and make a 3 point profit, that is relevant.

If the daily goal you have set is 3 points and the market moves another 50 after you exit the trade, well guess what .. Exactly irrelevant.

When the market decides to deliver your setup that locks in your daily goal can happen at any time, ideally one would think this would be best at the open. However an undisciplined trader who is trading without a set goal, may continue to take unnecessary risks and end up in a loss position.

So why work twice as hard to earn half as much?

Set your daily goal and earn twice as much for half the effort.

Stop trading when you reach your daily goal is most important for newer traders as they build their confidence and build their trading accounts.
From Forex Crunch

I feel that something equally important as the strategy that one uses to trade with is the psychology. Trading (especially forex) is not an easy thing to do and it can be disheartening when losses occur. I wanted to give you something to look forward to so you know what’s required to become successful.

The following video is inspired by an anonymous statement from a trader who outlined the 5 stages traders go through before becoming successful. I’ve made several mistakes during each stage, which you may be able to relate to, before making it through and my hope is that you honestly assess which stage you’re in and decide what you need to do to get to the next one. I hope that this provides you some certainty and a pathway to make it as a successful, profitable, forex trader. With that, keep at it and remember to keep focusing on your goal and make the right decisions- then you’ll hit your target.

Monday, September 6, 2010

Happy Labor Day

The world fx markets are humming right along without the USA as we take a little rest.  I am up early and trying my new broker and testing a 5 minute trading strategy on a demo account.  I'll blog more on that later.

Saturday, September 4, 2010

Learn Forex – RSI as a Forex Trend Indicator

courtesy of
James Chen is a "stay with the trend guy." He has a great site with tons of free stuff all about trading forex.

Here's a neat little post about RSI. I have to admit I've spent tons of time staring at indicators about which I have no education. Here's a little education.

Used in context, watch the videos I post from the guy at Perfect Stock Alert. He uses RSI, the slow Stochastics and a little MACD to figure everything (and with great precision.)

Also, here a little video link on the subject from Deutsche Bank.

Free Email Trading Course from MarketclubLesson Two : Trading the Trend

Lesson 2 - "Finding A Friend In The Trend" The trend is where the big money is made in trading. This lesson also covers false breakouts and how you can avoid them.
Understanding trend is the single biggest element to successful trading. I've done quite well in years where I have kept on track of the major trend. In other years, where I was not so attuned to the market .. it was a disaster.

One thing that has shocked me in the world of forex trading is the obsession with counter-trend trading, playing reversals, tring to pick tops and bottoms, ostensibly acting as if you are smarter than the market.  In some of the analysis webpages, we're talking major players, brokers, people with thousand of clients, this seems to be all that they do.  It's become one filter I use to judge whether I want to allow people into my Twitter on onto my reading list.

Oh they'll do great during the period when the trend is changing or indeterminate.  And you'll feel like crap when the whole market changes on you (Like I did in that last Euro trade.)  But the rest of the time, they're fighting against the tide, always seeking a trade.  Whereas, the trend trader will take a lump and then lie in wait for the next big thing.

Wednesday, September 1, 2010

Free Email Trading Course from Marketclub - Lesson 1 Psychology

Taking a free course is a good way to learn about trading.  I took this some time ago but finding myself in a position to retrain myself on the fundamentals.  Here's a preview of Lesson 1 from Market Club founder Adam Hewison

Most traders don't realize just how important the role of psychology plays in trading. Successful traders know thattrading is more than just buying and selling a market. It requires a complete understanding of what is going on in the market and in other traders' minds.
Trading is full of guys.  And I think the retail side is full of guys, sitting along staring at their screens.  It is tempting to get sucked into this private little world, away from job, away from the wife, away from the kids.  A solitary little oasis.  The problem is that this sets up a flawed view of trading. 

When trading you are in a vast crowd.  See it all as personal just don't take it as personal.  I've spent some time listening to a professional psychologist with a speciality in coaching traders.  She has urged us in the seminars to see the price action in a personal light.  Get a feel for what the crowd is thinking.  Think about the person(s) on the opposite side of your trade.

In particular, this first lesson is a real area of weakness for me.  Telling that a floor tarder with deacdes of experience places this first in his free course.  You see, I just did it.  I didn't just blindly accept the first emailed lesson as is.  I saw it in personal light (what does Adam this is of primary importance) , but I didn't take it personally (Adam is insinuating I suck at trading).

Exuberance Returns to Equities and EURUSD but this Run is Likely to Collapse - DailyFX September 1, 2010 -

Exuberance Returns to Equities and EURUSD but this Run is Likely to Collapse - DailyFX September 1, 2010 -
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