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A Trader’s Journey

  
Education, Video
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Dave shows how many successful traders take the same exact journey. They start with a simple method but slowly make it more complex. They search for the perfect indicators, thinking that if they work hard enough, they’ll find them. Unfortunately, it becomes so complex that they lose sight of basics. The true enlightenment comes when they return back where they started. They come to the realization that what they were looking for was right in front of them all along. They realize that although not perfect, simple methods can work quite well.

 

MARKET WISDOM

  
  Education
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A list of golden sayings and rules I have gleaned from many sources:
wisdom-thought

  • Plan your trades, trade your plan.
  • Trade Quality, Not Quantity.
  • Keep it simple.
  • Don’t look for a reason to enter the market, look for a reason NOT to enter.
  • Don’t act due to “Newbie Nerves”
  • Don’t make up a trade. If you have to look, it isn’t there.
  • Never play with scared money.
  • You are not the market.
  • Buy dips in an uptrend, sell rallies in a downtrend.
  • Do not try to pick tops and bottoms.
  • It is only divergence if it came off a retracement – not a sideways market.
  • Indicators warn, price action confirms.
  • Divergence is early, cross-overs are late.
  • You cannot expect your positions to go immediately into the money.
  • Divergence means a detour, but not necessarily a new trend.
  • No-one knows what will happen in the markets.
  • Standing aside is a position.
  • Subordinate your will to the will of the market.
  • Large ranges beget small ranges, small ranges beget large ranges.
  • Once a thing is set in motion, it tends to stay in motion.
  • Sniper-rifle, not a shotgun.
  • Cut your losses short, let your profits run.
  • Only move stops in the direction of your position.
  • Do not let a winner turn into a loser.
  • Never add to a losing position.
  • Forget losses quickly. Forget profits even quicker.
  • Consistent behavior equals consistent results.

There are probably more, send ’em in…

20 Habits of Wealthy Traders

  
  Education
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1)      Patient with winners and impatient with losers
2)      Making money is more important than being right
3)      View Tech Analysis as a picture of where traders are lining up to buy and sell
4)      Before they enter every trade they will know profit target or stop exit
5)      Approach trade no.5 with the same conviction as the previous 4 losing trades
6)      Use naked charts
a)      As we mature we begin peeling off indicators
b)      Prices action is key
7)      Comfortable making decisions with incomplete information
8)      Stopped trying to pick tops & bottoms long ago
a)      They make their money in the meat/middle of a trend (wait for confirmation)
b)      A trend is much more likely to continue than it is to reverse
9)      Do not think of the market as expensive or cheap
a)      Ignore whether you think something is overpriced or understand, think price action
10)  Aggressive with trade size when doing well or modest when not
a)      Do more of what is making, less of what is not
11)  Realised that the market will be open tomorrow (more…)

Trading Tactics

  
  Education
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Gerald Loeb

Gerald Loeb was a highly successful trader who wrote the classics “The Battle For Investment Survival” and “The Battle For Stock Market Profits.” Although they’ve been around for as long as I’ve been alive, you may find them helpful in today’s market.

Once in a while I take time to review old handwritten notes I’ve taken from the books I’ve read in the past including from Loeb. These notes often serve as inspiration to my own trading. Even though I’ve read them many times over the years, they always offer a good insight.

Loeb’s Trading Tactics:

  • The market is a battlefield. Make sure you are on the winning side
  • You must trade with the actions of the market and not simply by how you might think the market should trade
  • Knowledge through experience is one trait that separates successful stock market speculators from everyone else
  • To do well in short-term trading, it takes full-time attention and dedication
  • Exploit all new trends quickly and aggressively
  • The best traders are usually psychologists. The worst are usually accountants (more…)
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