Trading Forex
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Here's my take on trading with pressures and emotion.
You can paper trade all day every day and probably make some pretty good decisions and make money. Just like the article said, if you add pressures and emotions to it some people have trouble and make crappy decisions and end up losing money.
Here's where my experience comes in to make an analogy. I'm an Ironworker and Ironworkers build the structures of buildings, parking ramps, Stadiums etc. Here's the deal. Any one of us can walk across an I-beam when it's on the ground. Heck most of us can do cartwheels on it and be sure we will never fall off. If you put that beam 100' up in the air everything changes (trust me). What has really changed? Your perception has changed. All of the sudden your mind starts to play tricks on you and makes you believe that you are in real danger (and don't have the skill or balance) and most people can't walk across that beam anymore. The beam never changed but, your emotions did and that effects your reality.
I feel trading with real money on the line and outside pressures and baggage does this to people (it does to me) and they need to get past all that in order to be successful. I learned how to walk across beams in the air so I'm pretty sure I can handle smart trading. It just takes experience. The more trades you make the more natural it will feel. I'm no pro by any means but, I already feel more comfortable trading because I have taken a few beatings (losses) and even a couple of wins along the way. In my opinion, Nothing gives you more confidence than stringing together even just 2 small wins in a row. Confidence (not cockiness) is a good thing in any aspect of life.
the object is to make money not lose
No problem bud. It seemed like it fit in well here. I've read it a few times.
No problem bud. It was a good read.
Seven Habits of Ineffective Traders
I found this over on lowtrade's board. It's a good read and goes hand in hand with some of this board's philosophies, so I borrowed it.
(reposted acct it's a great read)
Friday November 5, 1:03 pm ET
By Ken Wolff, RealMoney.com Contributor
Recently, a couple of people I know packed up and quit trading after struggling for a long time to hold their heads above water. They didn't make it.
This isn't unusual, of course. This profession has a high failure rate. But it frustrated me.
It frustrated me because I could see potential in them. I don't believe you have to be particularly talented or intelligent to be a successful trader, but these people seemed to have a grasp on the market and the love of trading that's necessary.
They had the tools, the knowledge, the time and the funds. It also frustrated me because I could see the pressure they were under that contributed to their failures. Most of all, though, it frustrated me because I could clearly see what they were doing wrong, but they couldn't stop repeating the same mistakes.
This happens a lot. I see a lot of people making the same mistakes. So I thought I'd share my list of the seven most frustrating things that struggling traders do.
1. When people won't do their own homework. Too many people want to make money, but aren't willing to put the time in and do what it takes. I love answering questions, and I have a passion to help people learn, but when I notice someone asking the same questions over and over, and they are basic questions that anyone could Google, and gave it 30 seconds worth of effort, I know that person is lazy and probably won't make it.
You want to know what makes successful traders? People who glue their butts to their chairs. Look at their computer desks and you're likely to see lots of coffee rings and crumbs. You get out of something only what you put into it. If you aren't willing to take notes, take some initiative, keep a journal and spend a lot of time watching stocks, I don't see much hope for you as a trader.
2. When people can't explain their reasoning for a trade. If your reason for entering a trade is something vague like, "I thought I saw buyers, and last week it had news, and I dunno, it just looked good," then you don't belong in that trade! People like this usually have no clearly conceived, written, organized trading strategy because they are lazy. They are doomed to failure.
If you have no solid reason for a trade, you will have no confidence in it. You will wind up mistiming, misjudging, fumbling and losing. Here's a quote from my partner Phil Rosten, who is a brilliant technician:
I think the most important thing to do is to develop a system that you have confidence in. You will get nowhere if you are second-guessing what you are doing. When the market is open, you need to know what you are doing, and why you are doing it, without thinking too much about it. If you start thinking too much about what you are doing or second-guessing yourself, you will quickly get taken out of the game.
Believe it or not, it doesn't matter much what your reason is, as long as you are consistent with that reasoning. But you'd better have a reason.
3. When people make things more complicated than they need to be. Let me give you an example. One of the leaders in my chat room finally unveiled a new trading system he had developed after more than a year of extensive testing. The system works just as it is. It isn't perfect (no trading system will be 100%), but it is highly profitable.
People's initial reactions were interesting. Instead of saying, "Wow, great. Let me give it a try," a common first response was, "I wonder if it would work even better if we changed this and that, and instead of a 15-day moving average we used a 10-day moving average," and on and on. Before they even tried or understood the system, before ever becoming profitable and successful with it, they immediately set about trying to improve it.
Maybe it's human nature. We love trying to reinvent the wheel. Many of us see trading as a puzzle. If we could just find that solution or formula that no one else has thought of yet, we would be rich and happy. A lot of people think that the more indicators they pile on, the better their trading results will be. So they wind up with analysis paralysis, unprofitable and frustrated, convinced that trading is an unwinnable gamble.
I can't say this enough: What matters is not the system itself, but what you do with the system -- your discipline to use it and keep stops. You won't find a system that always works, so you'd better limit those losses. Two percent of your trades can easily wipe out 98% of your gains if you can't keep stops.
4. When people enter a trade for a good reason, then lose their nerve and exit too soon. This is a lot like walking across a log over a river. If you keep focused on your goal, you will get to the other side. You know how to walk a straight line, and you would have no problems if the log was on the ground. But once you are out there, if you start second-guessing yourself and looking down at the rocks below, you will fall. Too often emotions set in and sabotage good trades.
If you have a reason, stick with it. Stay in the trade until your target is reached, you have an exit signal, or the reason for your entry is no longer valid.
5. When people hesitate, or follow others, and enter a trade too late. I understand traders' lack of confidence and I can empathize because I've been there. If they don't get a grip on it, though, it will be their downfall. Calls are great and gurus are great, but if you follow, you will always be late. You need to learn to rely on your own reasoning. Otherwise you will be too slow and you'll become fish bait.
Inexperience is often the reason for this, and that will take care of itself with time. That's why I recommend starting with small shares until you gain confidence in your system and your ability to keep stops. But this problem frequently has to do with deeper emotions, pressures and self-esteem problems that may not go away as easily.
This is hard stuff because it's all about confidence. When you are under pressure from a spouse who disapproves of your trading, or under pressure to pay bills, etc., you are working under an enormous amount of fear and pressure. And that is automatically going to cause hesitation. I know that's a hard situation.
But I tell you, if you don't get that under control and learn to trade like you don't need the money -- with control and a system, leaving out emotion -- you are not going to make it. You must find a way to ease that pressure. Get a part-time job if things are that rough and you still believe trading is the job for you. If you cut back and trade a couple of days a week without the pressure, you'll probably trade better for it and wind up making more money than you did trading five days a week under pressure. I've seen it happen many times.
6. When people will not contemplate the real reasons for their failures. I don't know how many times I have heard this: "The market was tough today. I had one good early trade and then gave it all back in the afternoon in a few bad trades."
Let's be honest here. The market wasn't making you do those stupid later trades. It was you. Don't blame it on the market when in reality you were chasing longs all day when the market was tanking.
Then people will say something like "I need help with risk management," "I need help learning to find good entries," "I need help learning executions" or some other topic not really related to their true mistake. What they need instead is a dose of self-restraint and some personal accountability. They need to stop making trades out of boredom, frustration, regret or any other reason other than "it met my trading criteria." They also need to be honest about these criteria and not stretch things into "well, it kind of meets my criteria -- if I look at it cross-eyed."
I know this is hard. It's tough to sit there all day and stare at these numbers, especially when things are slow and there have been no good trading opportunities that day. It's like fishing. Fishing can be really boring. But if you aren't sitting there waiting with your hook in the water, you won't catch anything when the big fish come by. And it won't help if you jump in the water every time you see a ripple, trying to convince yourself you had a bite.
7. A defeatist attitude, especially in me. The potential in our lives far exceeds what we ordinarily imagine. Too often we put limitations on ourselves with Eeyore-like thinking. We say "I can't do this" or "I am just not smart enough" or "I'm just unlucky." In doing so, we fail to challenge ourselves and develop new potential because we've lost faith in ourselves.
We are like circus elephants tied with small weak chains to a stake, believing we could never get free, unaware of our own strength. We possess tremendous potential, but if we develop the bad habit of convincing ourselves that our potential is limited, we will not actively challenge ourselves and grow. Like the elephant, we will be held captive by our own beliefs.
If you have a defeatist attitude, you've already lost. So let's keep a positive mindset and try to see each mistake as a stepping stone to growth.
Kind of a bloodbath going on over here. A good 10% pop today but with absolutely no volume.
Thanks bud!
I found this over on lowtrade's board. It's a good read and goes hand in hand with some of this board's philosophies, so I borrowed it.
Seven Habits of Ineffective Traders
(reposted acct it's a great read)
Friday November 5, 1:03 pm ET
By Ken Wolff, RealMoney.com Contributor
Recently, a couple of people I know packed up and quit trading after struggling for a long time to hold their heads above water. They didn't make it.
This isn't unusual, of course. This profession has a high failure rate. But it frustrated me.
It frustrated me because I could see potential in them. I don't believe you have to be particularly talented or intelligent to be a successful trader, but these people seemed to have a grasp on the market and the love of trading that's necessary.
They had the tools, the knowledge, the time and the funds. It also frustrated me because I could see the pressure they were under that contributed to their failures. Most of all, though, it frustrated me because I could clearly see what they were doing wrong, but they couldn't stop repeating the same mistakes.
This happens a lot. I see a lot of people making the same mistakes. So I thought I'd share my list of the seven most frustrating things that struggling traders do.
1. When people won't do their own homework. Too many people want to make money, but aren't willing to put the time in and do what it takes. I love answering questions, and I have a passion to help people learn, but when I notice someone asking the same questions over and over, and they are basic questions that anyone could Google, and gave it 30 seconds worth of effort, I know that person is lazy and probably won't make it.
You want to know what makes successful traders? People who glue their butts to their chairs. Look at their computer desks and you're likely to see lots of coffee rings and crumbs. You get out of something only what you put into it. If you aren't willing to take notes, take some initiative, keep a journal and spend a lot of time watching stocks, I don't see much hope for you as a trader.
2. When people can't explain their reasoning for a trade. If your reason for entering a trade is something vague like, "I thought I saw buyers, and last week it had news, and I dunno, it just looked good," then you don't belong in that trade! People like this usually have no clearly conceived, written, organized trading strategy because they are lazy. They are doomed to failure.
If you have no solid reason for a trade, you will have no confidence in it. You will wind up mistiming, misjudging, fumbling and losing. Here's a quote from my partner Phil Rosten, who is a brilliant technician:
I think the most important thing to do is to develop a system that you have confidence in. You will get nowhere if you are second-guessing what you are doing. When the market is open, you need to know what you are doing, and why you are doing it, without thinking too much about it. If you start thinking too much about what you are doing or second-guessing yourself, you will quickly get taken out of the game.
Believe it or not, it doesn't matter much what your reason is, as long as you are consistent with that reasoning. But you'd better have a reason.
3. When people make things more complicated than they need to be. Let me give you an example. One of the leaders in my chat room finally unveiled a new trading system he had developed after more than a year of extensive testing. The system works just as it is. It isn't perfect (no trading system will be 100%), but it is highly profitable.
People's initial reactions were interesting. Instead of saying, "Wow, great. Let me give it a try," a common first response was, "I wonder if it would work even better if we changed this and that, and instead of a 15-day moving average we used a 10-day moving average," and on and on. Before they even tried or understood the system, before ever becoming profitable and successful with it, they immediately set about trying to improve it.
Maybe it's human nature. We love trying to reinvent the wheel. Many of us see trading as a puzzle. If we could just find that solution or formula that no one else has thought of yet, we would be rich and happy. A lot of people think that the more indicators they pile on, the better their trading results will be. So they wind up with analysis paralysis, unprofitable and frustrated, convinced that trading is an unwinnable gamble.
I can't say this enough: What matters is not the system itself, but what you do with the system -- your discipline to use it and keep stops. You won't find a system that always works, so you'd better limit those losses. Two percent of your trades can easily wipe out 98% of your gains if you can't keep stops.
4. When people enter a trade for a good reason, then lose their nerve and exit too soon. This is a lot like walking across a log over a river. If you keep focused on your goal, you will get to the other side. You know how to walk a straight line, and you would have no problems if the log was on the ground. But once you are out there, if you start second-guessing yourself and looking down at the rocks below, you will fall. Too often emotions set in and sabotage good trades.
If you have a reason, stick with it. Stay in the trade until your target is reached, you have an exit signal, or the reason for your entry is no longer valid.
5. When people hesitate, or follow others, and enter a trade too late. I understand traders' lack of confidence and I can empathize because I've been there. If they don't get a grip on it, though, it will be their downfall. Calls are great and gurus are great, but if you follow, you will always be late. You need to learn to rely on your own reasoning. Otherwise you will be too slow and you'll become fish bait.
Inexperience is often the reason for this, and that will take care of itself with time. That's why I recommend starting with small shares until you gain confidence in your system and your ability to keep stops. But this problem frequently has to do with deeper emotions, pressures and self-esteem problems that may not go away as easily.
This is hard stuff because it's all about confidence. When you are under pressure from a spouse who disapproves of your trading, or under pressure to pay bills, etc., you are working under an enormous amount of fear and pressure. And that is automatically going to cause hesitation. I know that's a hard situation.
But I tell you, if you don't get that under control and learn to trade like you don't need the money -- with control and a system, leaving out emotion -- you are not going to make it. You must find a way to ease that pressure. Get a part-time job if things are that rough and you still believe trading is the job for you. If you cut back and trade a couple of days a week without the pressure, you'll probably trade better for it and wind up making more money than you did trading five days a week under pressure. I've seen it happen many times.
6. When people will not contemplate the real reasons for their failures. I don't know how many times I have heard this: "The market was tough today. I had one good early trade and then gave it all back in the afternoon in a few bad trades."
Let's be honest here. The market wasn't making you do those stupid later trades. It was you. Don't blame it on the market when in reality you were chasing longs all day when the market was tanking.
Then people will say something like "I need help with risk management," "I need help learning to find good entries," "I need help learning executions" or some other topic not really related to their true mistake. What they need instead is a dose of self-restraint and some personal accountability. They need to stop making trades out of boredom, frustration, regret or any other reason other than "it met my trading criteria." They also need to be honest about these criteria and not stretch things into "well, it kind of meets my criteria -- if I look at it cross-eyed."
I know this is hard. It's tough to sit there all day and stare at these numbers, especially when things are slow and there have been no good trading opportunities that day. It's like fishing. Fishing can be really boring. But if you aren't sitting there waiting with your hook in the water, you won't catch anything when the big fish come by. And it won't help if you jump in the water every time you see a ripple, trying to convince yourself you had a bite.
7. A defeatist attitude, especially in me. The potential in our lives far exceeds what we ordinarily imagine. Too often we put limitations on ourselves with Eeyore-like thinking. We say "I can't do this" or "I am just not smart enough" or "I'm just unlucky." In doing so, we fail to challenge ourselves and develop new potential because we've lost faith in ourselves.
We are like circus elephants tied with small weak chains to a stake, believing we could never get free, unaware of our own strength. We possess tremendous potential, but if we develop the bad habit of convincing ourselves that our potential is limited, we will not actively challenge ourselves and grow. Like the elephant, we will be held captive by our own beliefs.
If you have a defeatist attitude, you've already lost. So let's keep a positive mindset and try to see each mistake as a stepping stone to growth.
Take a screen shot. Here's how.
http://m.wikihow.com/Take-a-Screenshot-in-Microsoft-Windows
I was mostly joking bud. Pump knows how to handle his money.
I hate to see it sliding downhill so much since it was my first stock I bought that wasnt an OTC or pink. I'm kind of emotionally attached to it lol. I feel like she cheated on me but I still love her lol.
Oh crap Pump. Don't ever listen to anything I say. I have no idea what i'm doing lol. I only got out to free up some cash for some of your pics lol.
Thanks break good post. I used to follow $heff's board but, none of it made much sense to me so I quit lol.
Nice paint
I've looked at it twice already today lol!!!!
You lost me at SPY and HFT's lol. I know a lot of farmers and some are into trading the Commodities they grow. I can only imagine that they know the market pretty well since it is their livelihood. Thanks AD, I never really looked at things like this before.
Yes perfect. I never looked at other investors as "competition" before, Interesting outlook. Thanks.
Quick question. Why are biomed stocks so different? I have heard others say the same. Some love em some hate em.
I hear ya bud. See ya later.
You sure must love your job bud. The way you trade you better be staring in a porno lol.
BFHJ lookin good here. .0026
Man you do cut losses quickly lol. I appreciate you calling out your buys and sells, I can learn from that. Thanks.
I was just about to ask what happened. Not playing just keeping a watch on.
Helmsman, I was this from Jan. to late last week. For me it was all the delays. I am not very patient and felt like I could do better with the cash in some other plays.
It felt like a pretty safe play compared to the pinks but, lack of patience got the best of me. This was just my take on it and I know at least one other guy is sitting on a pretty good chunk of shares and is waiting for it to take off.
For what it's worth, $.33 to $5 is just under 4x. Edit: I'm thinking in terms of baggers
I'll bet you know something about closing over the 200 right pump. How many mulit baggers you been in this month? 10? 15? Take care bud!
You can laugh all the way to the bank with the timing you had on this play lol.
I talked it over with my wife and if we have another kid we will be naming it....
"Pumpnass"
I know bud. I had to leave right as the run was starting. Watching from my phone though. Good call bud.
I hope so bud. I'd like to get back in that one sometime.
Next up after 17 is .50 lol go BFHJ !
I see people are getting sick of waiting for IGC. Kind of glad I got out last week with a small loss.
Hahaha! I'm in really good company in this one. Good luck bud! Go BFHJ!
Hell I've got 6 different aliases and have him person marked on all of them.
Just kidding ihub staff.
Looks like good volume coming in. Something is up.
Good play bud.
I've been following his board for a few weeks now. I'll dig deeper shortly. Thanks for the tip about the log scale haha.
Oh. Ok, nevermind then lol.
Will do bud but, stick around and we'll be whales soon enough lol. Welcome to the ATM bud!
Haha. Hey bud, I pulled this link from the ATM ibox. http://investorshub.advfn.com/boards/read_msg.aspx?message_id=61649333
I've watched this vid 3 times so far. You might have already seen it but, watch it again. It gives great insight on how to play the P&Ds. There must be a reason one of you mods put it in the ibox. Thanks to whoever did.
Haha yea I know what it's like. You made $$$ today forget it and play the next one bud. I'm personally learning a lot about these pump and dumps and will be ready to play them smarter each time. Pretty soon You'll be calling em and pumpnass will be asking questions lol.