Rules that I can live by: my rules have to be rules that I stand a good chance of keeping, not the kind that I will follow for one day and then give up the next. I’m not the kind of trader that can follow rules mechanically, like if x happens 3 times then do… Read More »
1). Preparation Once you get your trading system and position size in place you must use the amount you will risk on each trade to determine your risk of ruin. If your risk of ruin is not zero then you will eventually blow out your account. Risking 1% to 2% of your capital in any… Read More »
1. Do not be overly concerned about whipsaws a good trend pays for them all. A whipsaw is when you enter a position but get stopped out quickly when the market reverses opposite to your position. If you are a trend trader this may happen many times in a row in a range bound market. … Read More »
Complacency When I think of complacency two major things come to mind: Often a traders biggest loss comes after a string of winners. This is well documented and suggests to me that complacency is present. The ‘every swing I take is a home run feeling’ or the ‘I can do no wrong feeling’. Sure enough… Read More »
Rule 1 – If you cannot see trends and patterns almost instantly when you look at a chart then they are not there. The longer you stare, the more your brain will try to apply order where there is none. If you have to justify exceptions, stray data points and conflicting evidence then it is safe… Read More »
You don’t choose the stock market; it chooses you. A little bit of early trading success can have a profound effect on a person’s soul. If it does choose you, you’ll have to accept that your life and investing will become forever connected. Your methodology must provide an unshakeable foundation that you believe in totally, and you… Read More »
Do you see yourself in any of following mindsets? Have you ever done or thought anything like this? If you have not, then please stop reading since you have attained trading mastery and don’t need any words from me: No time to wait for setups. It looks like it might work, so I am going… Read More »
There are things that we do as traders that set us back in our journey to success and lose us money. There are other things that traders do that just destroy themselves. Many of the following things are done daily by the 90% of traders that lose money in the market consistently. If we want… Read More »
The vast majority of traders are gamblers, maybe the majority of market participants are in fact gamblers. The traders that are gamblers trade with no plan and without understanding the odds are stacked against them. Whether it is buying far out of the money options with no method for profitability or randomly chasing stocks on… Read More »
For years people have swarmed to the Futures markets, hoping to find the holy grail trading system and to get rich overnight. If you really believe there is such a thing as the holy grail trading system, then why don’t more people quit their day jobs in search of this elusive creature? Part of the… Read More »