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Count down 3, 2, 1 to develop as a trader

  
  Education
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Count down 3, 2, 1 to be a trader!

3) Focus on the psychology and mental skills that are necessary to succeed in the market.  Learn to read the market charts in terms of the pscychology of the other traders.

2) Learn about risk control in depth.  What this really means, options available to you, how you can marry it up with your financial objectives in the market place etc.

1) Only when you have the above dialled in should you investigate ways of putting trades on in the most advantageous positions to generate the returns you are looking for.

I think if people were to count down 3, 2, 1 there would be many more successful traders. 

Is Venting Emotion Good for Trading?

  
  Education
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Does venting emotion help a trader regain focus or does it exacerbate emotional and physical arousal and interfere with concentration and decision making? Research actually suggests that venting emotion after a traumatic event can lead to worse psychological outcomes. The key seems to be whether the venting allows for a reprocessing of the stressful events. If the venting leads to new ways to interpret what has happened–new perspectives–it can be helpful. If there is no such transformation of the stressful event, venting can simply amplify stress responses and reinforce them. Venting in a social manner to gain control can constitute good coping. But losing emotional control simply reinforces a sense of lost control.

Traders -Remember These Two Words-Won't & Can't

  
  Education
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Won’t– Phrases include: “The market won’t…” or “I won’t make money”. Notice a theme here? You are part of the market, you are not the market. Not getting what you expect, even if it is positive, confuses the brain. If you expect to lose and don’t it is still a bad outcome. Your brain is going through enough as it is. The market is a one way walkie talkie, you listen, it talks.

Can’t– Phrases include: “The market can’t..” or “I can’t…” or “I can’t lose anymore”. Yes the market can, go look at a chart. Go look at a Fed day or about any chart from 2008. Not only can it happen, it does happen. There are no more once in a lifetime moves in the market. There are and always have been life changing moves. No one ever said trading was easy but at least in the case of futures someone is taking your money. If you think you can’t, you probably wont. The market will take every penny you have. If can take every penny you put at risk. Fix the problem, when you run out of money it is too late.

14 Questions for Traders

  
  Education
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1)       Do I treat my trading/investing like a business?  Have I prepared for it the way I would for any other business?

2)      Do I have a business plan – a working document to guide my trading business?

3)      Do I have a set of written rules to follow?

4)      Am I following a regular procedure to prevent mistakes?  A mistake means not following your rules that you have laid out for yourself.

5)      Do I have a tested trading methodology?

6)      Do I know how my methodology will perform in different kinds of markets?

7)      Do I know what kind of market we are currently in now and what to expect from my methods in such a market?  Should I be trading these markets?

8)      Do I trade with exact exit points that are preplanned for every trade (position) I take?

9)      Have I developed specific objectives for my trading/investing?

10)    Do I understand that I achieve my objectives through a POSITION SIZING METHOD?   Have I developed a specific position sizing method to meet my objectives?

11)   Do I truly understand the importance of all the questions mentioned above?

12)   Do I understand that I create my own trading/investment results through my thoughts and beliefs?

13)   Do I accept full responsibility for that creation?

14)   Do I regularly work on myself to make sure that I follow the very important points (questions) above? (more…)

Market Timing

  
  Education
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“Market timing is the art of making investment decisions using indicators and strategies to observe and determine the direction of prices. Many believe that market timing involves predicting the future, when in reality, the goal of market timing is to participate in periods of price strength and avoid periods of price weakness.?

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