Reblog: Trading As A Business – My Step By Step Guide


You have all probably heard that you need to treat trading as a business if you want to be successful. But what does this actually mean? Instead of letting it be just another meaningless phrase, let’s take a deeper look to fully understand it.

The ideas behind “treating trading like a business” are very important to get you on the right track and after we have taken a look at the different aspects, I am sure you will get some ideas on how to take your trading to the next level and treat it more like a business.

Your setups are your products and services

Every business has either physical/virtual products or services to sell in order to generate profits. The business, hopefully, knows everything there is to know about their products, where it is from, how it is built, what the benefits are, what the potential struggles are, how to keep improving their product, what their customers want, and how to use it in the best possible way. The business must be the #1 expert in what they are offering. Obviously.

As a trader, your setups and your strategies are your products. Your setups are a set of rules and triggers to help you find potentially profitable trades. Whether your setups consist of classic patterns, indicators, pure price action or a combination doesn’t matter here.

What is important is that YOU must be the expert in your setups and patterns. You must know every little detail, when the setup works best, during which market conditions it doesn’t work, in which markets and timeframes to use it, how to improve the odds, how to set stops and pick targets, when to move stops and how to manage trades, when to add to a position or take some off the table, when to stay out, etc.

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Reblog: 15 Quotes From Legends In Sports That Will Help Boost Your Trader’s Mindset


That Will Help Boost Your Trader’s Mindset

Being a top athlete takes a lot of grit and perseverance. Because whenever one feels complacent is exactly when one might fall flat on one’s face. So, professional sports are constant acts of pushing past limits. And not every person can manage such levels of physical and mental efforts.

That is why top athletes often have these extraordinary nuggets of wisdom they occasionally share with the world. And what’s fascinating is how these pearls of wisdom are relevant in trading. But not only — they’re also relevant in business, relationships; in fact, they’re relevant in life in general.

Here are some of the best motivational statements by legends in sports:

1. Success is where preparation and opportunity meet. – Bobby Unser, automobile racer

In trading: Rash decisions that will leave you in a weak position. Always come prepared.

Trader's mindset Michael jordan

2. Obstacles don’t have to stop you. If you run into a wall, don’t turn around and give up. Figure out how to climb it, go through it, or work around it.  – Michael Jordan, basketball icon

In trading: When failure smiles at you, the best thing you can do is smile back, while acknowledging that the lessons that stick are those that hurt. Your failures are stepping stones on your way to success.

3. I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. 26 times, I’ve been trusted to take the game winning shot and missed. I’ve failed over and over and over again in my life. And that is why I succeed. – Michael Jordan

In trading: Again, be patient with yourself. At first, you will make mistakes; you will fail. But you want to fail. You need to fail. Failure is good for you. It builds resilience of mind; develops wisdom; it is the foundation upon which mastery, success, and happiness rest upon.

4. In baseball and in business, there are three types of people. Those who make it happen, those who watch it happen, and those who wonder what happened. – Tommy Lasorda, Hall of Fame baseball player and manager

In trading: You miss 100% of the trades you don’t take. Stay active, trade small. Engagement leads to success. There is no overtrading if you’re trading a proven system.

5. There may be people that have more talent than you, but there’s no excuse for anyone to work harder than you do. – Derek Jeter, longtime Yankees shortstop

In trading: You have to depend on your own work ethics to get ahead in this field. Don’t wait for trade ideas from others. Work on being completely self-reliant.

6. Everybody’s got plans… until they get hit. – Mike Tyson, boxing icon

In trading: The satisfaction of instincts cannot be the main way by which you place and manage your trades. You need a plan, and you need to follow it with consistent and conscientious regularity.

Trader's mindset Arnold Schwarzenegger

7. Strength does not come from winning. Your struggles develop your strengths. When you go through hardships and decide not to surrender, that is strength. – Arnold Schwarzenegger, professional bodybuilder, actor, businessman, politician

In trading: Muscles need a certain amount of stress in order to grow. It is with muscles as it is with life –meaningful growth requires challenge and stress. So, don’t think of losses, mistakes, and failures as the end of the world. They’re just opportunities for growth.

8. Bodybuilding is much like any other sport. To be successful, you must dedicate yourself 100% to your training, diet and mental approach. – Arnold Schwarzenegger

In trading: Whoever focuses solely on his/her market edge while neglecting his/her trading psychology will soon discover trading to be an unwinnable battle.

9. Champions keep playing until they get it right. – Billie Jean King, International Hall of Fame tennis star

In trading: Whatever you do, trade small. If you can’t stay in the game, you can’t learn. It’s simple as that. Failures and mistakes have to be small —so small that they can teach you instead of ruining you. If they’re too big, you’ll eventually get booted out of the game.

10. A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be. – Wayne Gretzky, hockey icon

In trading: It doesn’t take a lot to predict price action (human behavior) and capitalize on it. You only have to assume that people will always try to escape a disagreeable situation with the smallest possible expenditure of intelligence. With that in mind, you need a plan to guide your own behavior, and you need to trade that plan with discipline and vision.

11. Always make a total effort, even when the odds are against you. – Arnold Palmer, golf legend

In trading: Part of being a good trader is knowing how to go through drawdowns with grace, courage, patience, and vision.

12. The more difficult the victory, the greater the happiness in winning. – Pele, Brazilian, soccer legend

In trading: You fall, you fail, but after some time, you learn. And eventually, you master! Then get-rich-quick prospectors watch you from the outside, jaw hanging. They see how trading is simple and they think it’s a straight line. It never is.

Trader's mindset Muhammad Ali

13. He who is not courageous enough to take risks will accomplish nothing in life. – Muhammad Ali, Boxing icon

In trading: Here’s something that’ll raise a lot of eyebrows: Even if you’re a consistently profitable trader, you will never become incredibly wealthy by being too conservative. For that to happen, you gotta be wild sometimes, take some daring bets, with size, and be truly ok with failure.

14. It isn’t the mountains ahead to climb that wear you out; it’s the pebble in your shoe. – Muhammad Ali

In trading: When you approach the markets with equanimity, all mental stories are thrown away, and what remains is just the market as it is.

15. Persistence can change failure into extraordinary achievement. – Matt Biondi

In trading: Patience/ resilience/ non-delusion will be rewarded by the markets.

Bonus. If you aren’t going all the way, why go at all? – Joe Namath, Hall of Fame football quarterback

In trading: Resilience is key! Do what you have to do to stay in the game long-term. In due time, you’ll be able to:

  • Trade and understand the market like no one
  • Trade with size
  • Turn small accounts into big accounts

And best of all: Nobody will be able to take that away from you.

The original compilation is by Yvan, appears on tradingcomposure.com and is available here.


Reblog: Some Things I’ve Learned Over The Last 30 Years


Today marks 30 years since a confident young man walked into the back office of Schroder Investment Management in London, to start his first day on the job, the first in his career. Ask me a question back then and I would have answered assuredly and quickly. Today I’d be more likely to say ‘I don’t know’ with just as much confidence.

Now older, wiser, but with just as much hair, I have over the years seen many people come and go. Clients, colleagues, bosses, company mergers, bankruptcies (thankfully not my own), through bull and bear markets, booms, crashes, and have seen my own fortunes fluctuate too before setting out on my own a few years ago.

Thirty years is a long time. The good news is it was all worth it.

The first thing to point out is I don’t have all the answers. That’s not what this post is about. I’m always learning. But I have benefited enormously from people sharing their time and expertise, so if I can help others in the same way, I’m happy to share what I’ve learnt also.

These are 30 observations, guiding principles, or simply things that work for me. Some of you who have followed me for a while will recognise many of them. These aren’t universal truths, they’re my truths, my beliefs, shaped by my experience.

And that’s probably a good place to start.

“The more you believe something to be true, the more you will have accumulated evidence to support it.”

That’s a quote from trading coach Van Tharp, and I’ve applied it to so many areas as a simple way of explaining people’s expression of their beliefs, my own, and the realisation of how powerful confirmation bias is. Van believes we don’t trade the markets, we trade our beliefs in the market. A trading system therefore is simply a set of beliefs, and I think he’s right.

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Reblog: Trading Tips by Ed Seykota


If you are a trend follower then  you must have heard of Ed Seykota. Ed Seykota was first featured in the book “Market Wizards” and has one of the best track record of all time. In one of the accounts he managed, he had a return of 250,000% over a 16 year period. Comparable to the likes of Warren Buffet, George Soros and William J. O’Neil.

Ed Seykota has an Electrical Engineering degree from MIT and is a systematic trader. His trading is largely confined to the few minutes it takes to run his computer program which generates signals for the next day. I’m sure most traders would like a system that does that.

With such an amazing trader around, it makes sense to pay attention whenever he talks. So here are the 39 best things said from the man him self, Ed Seykota.

Quotes by Ed Seykota

Technical analysis

1. In order of importance to me are: (1) the long-term trend, (2) the current chart pattern, and (3) picking a good spot to buy or sell. Those are the three primary components of my trading. Way down in very distant fourth place are my fundamental ideas and, quite likely, on balance, they have cost me money.

2. If I were buying, my point would be above the market. I try to identify a point at which I expect the market momentum to be strong in the direction of the trade, so as to reduce my probable risk.

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Reblog: The 7 Brutal Truths: Why You Should Not Be a Trader


Let me ask you…

Why do you want to be a trader?

You want financial freedom.

You don’t want to answer to anybody.

You want to be your own boss.

You want to make money.

You want a passive source of income.

Now you’re probably wondering:

“Is it possible to achieve all these from trading?”

Good question.

Then you’ll want to read every single word in this post because you’ll discover the myths, the possibilities, and most importantly… the truth about trading.

You may be surprised at what I’m about to share with you.

So if you’re ready… then let’s begin.

#1 You’re trading for passive income

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Reblog: Do You Have What It Takes To Successfully Trade Financial Markets?


Over the course of 15 years working as a performance coach with traders and investors, from day trading shops to hedge funds and investment banks, I’ve enjoyed an unusual front row on the factors that contribute to success and failure in financial markets. During that time, I’ve conducted numerous interviews, directly observed hundreds of traders and administered countless personality tests. That experience has convinced me that much of what we think we know about trading success is just plain wrong. In this article, I tackle three myths of trading success and offer alternate perspectives.

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Reblog: Ascending Triangle Chart Pattern (Trading Strategy)


Here’s the deal:

I’m not a chart pattern trader.

However…

The Ascending Triangle chart pattern is one of the few patterns I trade.

Why?

Because when other traders get stopped out, they help “push” the market further in your favor.

In short, you EXPLOIT the stop-loss orders of losing traders — and that’s why it works.

And because this is so powerful, I’ve created a new trading video on Ascending Triangle chart pattern.

You’ll learn:

  • What is an Ascending Triangle chart pattern and why does it work
  • You should always go short when the price is at Resistance, right? Wrong! I’ll explain why…
  • How to better time your entries & exits when trading the Ascending Triangle
  • When is the best time to trade Ascending Triangle (and why)
  • How to find high probability breakout trades with the Ascending Triangle chart pattern

You ready to learn this powerful chart pattern?

Then go watch this video below now…

Now, here’s a question for you…

How do you trade the Ascending Triangle chart pattern?

The original post by Rayner Teo appears on tradingwithrayner.com and is available here.


Reblog: 10 Price Action Trading Tips That Will Help You Become Better Traders


What is price action trading and why it does make you a better trader

Price action trading is a type of trading that allows traders to observe and study the current market. This, in turn, allows you to anticipate the market trend and make certain assumptions/decisions based on the current (and actual) price movements.

Price action trading is the purest type of trading that eliminates all noise.

It does not anticipate, it reads the market.

Price action is great!

Is price action trading better than other types of trading?

Hard to say.

It is really difficult to say if one type of trading is better than another. What matters is which type of trading fits your personality.

Another important element of trading is money management. What matters is even not that much the trading system, but the way you use it.

Profitable traders will agree with me.

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Reblog: The 6 Stages Of A Trader’s Development Part 2


This is the second part of the article. The first part can be accessed here.

Stage Four: The Determined Trader

  1. This is the stage in which you learn to specialize in certain markets and trading methods.
  2. Without realizing it, you have finally found your style of trading after hours of hard work and research. You stick to your method and you improve it
  3. You realize that you need an edge whether its tape reading or being a Fibonacci expert. The important thing is you are slowly transforming yourself into a specialized trader
  4. You test your methods and they seem to work. You gain tremendous market knowledge.
  5. You reflect back on yourself and you can’t help but laugh at your foolishness.
  6. Although you have not made enough money to call yourself successful you are proud of your journey and accomplishments
  7. You realize that the Holy Grail is not about technical indicators or price patterns
  8. You calculate risk before profits and place strict money management on all your trades.
  9. You cut losses short and learn to scale out on your winners.
  10. You start accept losing as a natural part of the game
  11. You take high probability trades that you have tested and feel confident about your setups because you understand that trading is a game of probabilities
  12. Your psychological makeup has changed from an amateur mindset to a professional one.

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Reblog: The 6 Stages Of A Trader’s Development Part 1


Stage One: The Clueless Trader

Image result for clueless trader

  1. Heard of a day trader making millions, or buying options is safe and can make you rich quickly
  2. Beginner Luck in first few trades.
  3. You will buy just to see the market reverse and you will short just as the market starts to rally. Someone is tracking my trades and making me lose money.
  4. Most of your trades are done emotionally. You buy just because the markets feel strong without any logical reason
  5. You have no clue how the mechanics and psychology of trading works. What’s worse? You are not aware that you don’t know.
  6. Most traders will blow their entire account multiple at this stage.
  7. Mostly you start your trading in fag end of bull market
  8. You will spend more time finding a broker charging least brokerage.Tracking World Markets, Bitcoins instead of making a trading plan for next day.
  9. A big majority of people will leave trading and blame the randomness of markets, or say markets are always manipulated
  10. You don’t know what is short selling or have never tried it, no idea of stop loss as well
  11. You are in the unconscious incompetence stage, at this stage, your capital is at maximum risk

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