Archives of “January 3, 2019” day

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DOs and DONTs of any sort of correction

  
  Education
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DOs and DONTS of a market crash

1. DO notice how cyclical markets are
2. DONT react emotionally
3. DO stick with your plan
4. DONT rely on gurus, shamans or talking heads (1000% Avoid Blue Channels )
5. DO note your own state of mind
6. DONT take actions while in a state of discomfort
7. DO notice the panic around you
8. DONT try to time the markets
9. DO look for signs of capitulation
10. DONT confuse the short term for the long term

Bonus: DO have a sense of humor

Amos Hostetter: One Great Trend Trader

  
  Education
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Amos Hostetter: Trading Dont’s

  • Don’t sacrifice your position for fluctuations.
  • Don’t expect the market to end in a blaze of glory. Look out for warnings.
  • Don’t expect the tape to be a lecturer. It’s enough to see that something is wrong.
  • Never try to sell at the top. It isn’t wise. Sell after a reaction if there is no rally.
  • Don’t imagine that a market that has once sold at 150 must be cheap at 130.
  • Don’t buck the market trend.
  • Don’t look for the breaks. Look out for warnings.
  • Don’t try to make an average from a losing game.
  • Never keep goods that show a loss, and sell those that show a profit. Get out with the least loss, and sit tight for greater profits.

Amos Hostetter: Dangers in Trading caused by Human Nature

  • Fear: fearful of profit and one acts too soon.
  • Hope: hope for a change in the forces against one.
  • Lack of confidence in ones own judgment.
  • Never cease to do your own thinking.
  • A man must not swear eternal allegiance to either the bear or bull side.
  • The individual fails to stick to facts!
  • People believe what it pleases them to believe.

Think about how simple Hostetter’s wisdom appears on the surface. But how many adhere to such principles?

Jordan Belfort interview – The Wolf of Wall Street

  
Education, Video
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Must Watch ,Don’t miss it 

Yachts, planes, women, drugs – stockbroker Jordan Belfort had it all and lost it all. Tom Leonard meets the man who taught the Mafia how to cheat – then wrote a book about it

Could there be a more compelling poster child for the dark side of modern capitalism than Jordan Belfort?
As a 31-year-old multimillionaire stockbroker, Belfort once landed his helicopter on his back lawn, flying with just one eye open because he was so stoned he had double vision. He sank his 167ft motor yacht, complete with seaplane and helicopter, after overruling the captain and taking it into a Mediterranean storm.
He organised a midget-throwing contest to entertain brokers on his trading floor.
And when he wasn’t completely out of his head on drugs, or getting executive relief from prostitutes in the presidential suites of luxury hotels, the man nicknamed the Wolf of Wall Street was presiding over a firm that swindled investors out of $200 million in a shares fraud that landed him and his chief confederates in prison. (more…)

4 Steps to Changing Your Bad Trading Habits

  
  Education
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1. Understand the benefit of change. First, ask yourself if you need to change. Then, ask yourself what you need to change. Identify your current habits and ponder the benefits of changing them. Perhaps while trading you are feeling negative emotions such as stress, anxiety, temptation, or frustration. And ultimately, these emotions cause you to make poor, impulsive and self-destructive decisions. Write down what would happen if you were no longer feeling such negative emotions. That is, what would happen if you were able to remain calm and clear-headed while trading?

2. Dissect the proposed change and benefits. Find as many holes in the prospective change as you can. Don’t just convince yourself that things will become better if you change. Make sure the grass actually is greener on the other side of the fence. Be clear about what you want to change and how you will go about it. Write down the benefits that will take place if you do indeed change.

3. Recognize the situation that triggers your self-destructive action. Write down those all-too-familiar conditions, or circumstances, that lend themselves to activating negativity within you (e.g., all the things done, or said, that push your buttons). Also, write down how you are going to consciously recognize them during the day as they happen. Now, next to each item, write down what systems and processes you will implement to avoid letting that situation become emotional. (more…)

10 Trading Books -Every Trader Must Read

  
  Education
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“If there was easy money lying around, no one would be forcing it it into your pockets.” – Jesse Livermore

There is so much garbage out there concerning trading online and the temptation for easy money that many new traders are lured into childish beliefs about getting rich quick, following a guru that can predict the future, or confusing a salesman for a trader. Contrary to popular belief, trading is not about picks, predictions, or personal gurus. Trading is really about entry signals with an edge, following price action, and learning to trade a system that fits who you are as a trader. Real long term profitable trading is about, risk management, robust trading systems, and mental and emotional discipline. I would not trust anyone that did not have those three things at the core of their trading. Here is the right reading path for a new trader to follow to avoid all the hype, foolishness, con-artists, and childishness that arises from ignorance of a solid understanding of the subject of trading in the real world in real time.

Trade Like a Casino: Find Your Edge, Manage Risk, and Win Like the House (Wiley Trading)  “If we are properly managing the risk and adhering to a positive expectancy model, the act of trading a position should be boring.” – Richard Weissman

Trading Without Gambling: Develop a Game Plan for Ultimate Trading Success “If all your decisions were made during nonmarket hours with timing and execution being your main concern during market hours, you will dramatically increase your chances of success.” – Marcel Link

Trend Following (Updated Edition): Learn to Make Millions in Up or Down Markets “Trend followers are the group of technical traders who use reactive technical analysis. Instead of trying to predict a market direction, their strategy is to react to the market’s movements whenever they occur. This enables them to focus on the market’s actual moves and not get emotionally involved with trying to predict direction or duration.” – Michael Covel

Market Wizards, Updated: Interviews With Top Traders “The most important rule of trading is to play great defense, not great offense.” & “Don’t focus on making money; focus on protecting what you have.” – Market Wizards (more…)

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