There is very little that is new in the world of trading psychology but mastering the basics and mastering our mind is essential if we are to develop as highly efficient traders. The following are common discipline issues and suggestions to counteract them. Discipline is needed if you are to succeed as a Forex trader
1. Boredom and a need to trade for the “buzz”
Try to use dead time between trades for things like self improvement training i.e. read a book by your favorite personal development guru or learn to meditate/practice Yoga! Anything that keeps you in the right frame of mind for the job of trading. A positive mindset will have a positive impact on your bottom line over time.
2. Trading when tired.
One of the great things about trading is that we can close for business whenever we want. If you are not in the correct mindset for trading then shut the shop! There will be no customers banging on the door shouting for you to open up.
3. Not taking a loss well and revenge trading (more…)
Archives of “January 29, 2019” day
rssTrading is a business
Trading can be mastered if you concentrate your efforts on how you will react to price rather than desiring to predict it. Reacting is a business decision, predicting is an ego play.
Traders want to make money. Losses in the long run don’t matter. Forecasters (prophets) want to be right (ego). And that’s all that they are concerned about.
Don’t decide anything (ego), let the market do that job for you (business).
Like any other business you have a business plan and the financial portion of that plan is the most important.
In this business your inventory is stocks, bonds, futures or options. Like any other business you define what an acceptable loss is on an item and what is an acceptable profit for the risk undertaken. Like any other business if the item of inventory doesn’t do what you expected it to do, you put it on sale and liquidate it to raise capital to purchase inventory that will do what you want it to do. Your acceptable loss is your stop. Your money management system tells you how much that is. Your mark up is dependent upon your trading system and trading style. It doesn’t make any difference if you are a day trader or an investor. Like any business, some turn their inventory 10 times a day, some 20 times a year and some only twice a year. Your trading style and inventory volatility will tell you what your turnover rate will be.
Trading is a business and if you treat it as anything else you will be a loser.
Trading Lessons
The market is a tough battle. Each day there are chances and opportunities to make money though, it is the greatest form of free market capitalism known to man. It’s a vast ocean with treasures; we just have to be able to unearth them at the right moment. We have the ability to navigate carefully through markets, put our bets out there and see where the chips fall.
But if we are too loose with our capital then we are headed for a bad ending. Discipline is one of the keys to success: learn your craft and practice. Each day that passes is one more great learning experience – capture it, analyze it and grow from it. Use a trading system, pay attention to the timeless patterns of price/volume and believe in what you see and not what you hear. (more…)
THE MOST COMMON ERROR IN STOCK MARKET RESEARCH
Jeff Miller of Dash of Insight wrote a brilliant post on common research mistakes. It can be found here.
He breaks it down into two things: Selecting the Right Data and Comparison.
Selecting the Right Data. As the saying goes, if you torture the data for long enough it will tell you anything. There is so much data out there that you can make it say whatever you want. The most important thing about finding the right data is accepting the limitations of it and understanding it. Look at this way, I like a fast car but insurance and gas will cost more. Does that justify the tradeoffs for me? Yes. You? Maybe. All data is local.
Comparison. Mr. Miller calls is comparison but I prefer the word context. Most anyone can look at a data or chart and come to a reasonable outcome. Data records it does not tell the story. It can can tell a story but for the most part they are without context. Yes you can throw a couple more pieces of data in and get closer but who knows. Think about how ridiculous it would sound if I showed you a picture from 1950′s Chicago and asked you what it was like.
What Mr. Miller didn’t mention, probably because of time or my inabilities, is that data is secondary to what we do with it. For the most part we are untrained at using it. We are 14 year olds at the Playboy mansions. We get data F@#%&ed, data blocked, data complacent or whatever you want to call it.
A Cognitive Self-Appraisal for Traders
PATIENT . . . . . . . . . . IMPATIENT
FOCUSED . . . . . . . . . . DISTRACTED
OPEN-MINDED . . . . . . . . . . CLOSED-MINDED
PREPARED . . . . . . . . . . UNDER PREPARED
CLEAR HEADED . . . . . . . . . . CONFUSED
ALERT . . . . . . . . . . FATIGUED
FOCUSED . . . . . . . . . . DISTRACTED
OPEN-MINDED . . . . . . . . . . CLOSED-MINDED
PREPARED . . . . . . . . . . UNDER PREPARED
CLEAR HEADED . . . . . . . . . . CONFUSED
ALERT . . . . . . . . . . FATIGUED
Your mind, not your hardware or software, is your ultimate trading tool. The quality of your thought and perception will be reflected in the quality of the actions you take.
And those are likely to affect the trades you take, how you take them, and whether you take them.
2 Different Types of Entry Signals
Momentum Signals:
- This is buying into price strength.
- You buy high trying to sell higher or sell short low trying to cover even lower.
- You are buying a breakout of a range with the possibility that the break out level you bought becomes the new support.
- You are trading a trend of higher highs or lower lows.
- You are trading an asset under accumulation and the price is rising higher and higher as a trend continues.
Buying Support:
- You are buying weakness on the possibility that the low is in.
- You are buying oversold levels and believe that a snap back is imminent.
- You are buying pullbacks to key support levels in an uptrend.
- You are buying fear looking to sell it higher when an asset reverts to the mean.
- You are buying at technical levels that history shows presents a great risk/reward ratio and limited downside.
Money can be made buying dips and buying break outs. The keys to profitability lie in the winning percentage and the risk/reward ratio.
Yes ,Same with Chart & Fundamentals
All Fundamentals /Results………………………..are Cooked (Across Globe )
Data’s are Manipulated ,But Only Chart……….Gives u True Picture
20 Signs That The Global Economic Crisis Is Starting To Catch Fire
If you have been waiting for the “global economic crisis” to begin, just open up your eyes and look around. I know that most Americans tend to ignore what happens in the rest of the world because they consider it to be “irrelevant” to their daily lives, but the truth is that the massive economic problems that are currently sweeping across Europe, Asia and South America are going to be affecting all of us here in the U.S. very soon. Sadly, most of the big news organizations in this country seem to be more concerned about the fate of Justin Bieber’s wax statue in Times Square than about the horrible financial nightmare that is gripping emerging markets all over the planet. After a brief period of relative calm, we are beginning to see signs of global financial instability that are unlike anything that we have witnessed since the financial crisis of 2008. As you will see below, the problems are not just isolated to a few countries. This is truly a global phenomenon.
Over the past few years, the Federal Reserve and other global central banks have inflated an unprecedented financial bubble with their reckless money printing. Much of this “hot money” poured into emerging markets all over the world. But now that the Federal Reserve has begun “tapering” quantitative easing, investors are taking this as a sign that the party is ending. Money is being pulled out of emerging markets all over the globe at a staggering pace and this is creating a tremendous amount of financial instability. In addition, the economic problems that have been steadily growing over the past few years in established economies throughout Europe and Asia just continue to escalate. The following are 20 signs that the global economic crisis is starting to catch fire…
#1 The unemployment rate in Greece has hit a brand new record high of 28 percent. (more…)
Perfection in Trading :Anirudh Sethi
Being perfect is certainly not easy. Perfection is debatable, and needless to say, as challenging as can be. Matters become increasingly difficult when this is attributed to a trading environment or situation. Many traders end up setting their trades by focusing on what they want the results to be. They focus on the outcome of the trade, and do not give a lot of attention to the actual execution of that trade. This is in fact one of the main reasons why trading is so difficult. A trader can never hope to be perfect in his or her decisions. And, one can never hope for a perfect scenario, where any decision that is made results in a favorable result. Therefore the general rule of thumb that traders need to appreciate and get used to is that they need to perfect the decision making process and the execution of the trade, rather than hoping to make the results perfect. The choices, research, knowledge and information discerned are the steps that need to be perfected in the hope of perfecting the results of the trade in question.
Perfection also revolves around another issue in trading. The vast majority of traders worry a great deal about the outcome of their trading decisions. They experience a fear of losing out, and they do not want to risk a lot of their money either. They realize that in trading it is practically impossible to be perfect, and no matter how many years pass, and how many trades they do, they are still going to end up being imperfect.
Moreover, especially in the case of novice traders, it is normal to think that being a trader is a somewhat simple way to make money. They see the future as being rewarding and profitable – typically, a perfect way to become rich. Yet, they tend to underestimate the risks involved in trading and the various issues that revolve around making sound trading decisions and choices. (more…)
Apple cash is greater than the market cap of these companies
