Sledge

Ztrader- I love this- This could be wall plaqued and hung in my trading office for sure! Aaron

YOU ARE ALMOST THERE! I know it may sound like I'm out of my mind- but I'll say it again- YOU ARE ALMOST THERE! This is most likely the last test of your wills. The market is testing your sanity, it is testing your gumption, it is testing your perseverence. I have been in your shoes, I have lived it, I read this post and I feel for you because I know what it is like. You have dreams of what this can do for you and your life, your family. You KNOW their is a way to succeed, you just can't quite put your finger on it. It is like looking through a dirty window- you can see the outside world and its beauty- but if only the dirty haze was removed- you'd see the market full and whole, you would see the whole picture. Sound familiar? I had this happen in 2 stages my friend. I broke through the first one and thought "The Veil has been lifted" I think I've got it. Reality: I got a NICE chunk of clarity- but the window was still a bit dirty. So I entered Stage 2 of this- armed with my new found clarity and knowing that their is still something missing. I fought it, I tried to figure it out. I then had my ultimate "A-HA!!!!!!!!!!!!" Moment- everything I had learned, everything that was crap was filtered out- without me even thinking about it. All the pieces of the puzzle THAT MATTERED came together all at once. I know you don't believe me- but fight this. Fight it with every fiber of your being- you are very very close to breaking through! Aaron

You are 100% Correct. I explain to people that even if you are placing trades on a demo- it is the live market, it rips through your emotions of euphoria, fear, indecision, greed and countless others if you sit and watch it with a "live trade" in play. When they still scratch their head at me- not understanding- I say "Look this isn't like a video game- where their is some pre-defined outcome" "Their is no princess to save at the end of the castle- and if you hit the right buttons or jump to the right mushroom- that their is one and only one way to "win the game." The only difference between a $2 Grand Win on a Demo and a $2Grand win on a live account is the fact that you decided to test a theory without risking the money for real- BUT BUT BUT- ONLY if you approach a demo- as if it were real $, you think long and hard about your trades, you plan and execute- just as if their was real $ on the line- not wanting to lose the "fake $" and take it JUST as seriously as if it were real. You'll get pissed if you lose $100 on a Demo, just as if you lost $100 for real! My .02 on that! Aaron

This is one of the best pieces of advice that ANYONE can read. If you new and trying to learn via Demo Trading- Trade it like it is real! I have known people who launched Demo Accounts with far more capital than they could actually ever start their account with in real life- Why? Makes it a pointless excercise IMO. I even talked with one trader while doing Demo's (this was in prep for utilizing a real account- so no time to be fooling around) that decided to buy 100 lots on a currency pair, said "oh it was funny, I was up like a half million and then was down like $1.5 million by the end of the day- it was funny!" I just looked at them and said "Hmm" That was a wasted day to actually learn something if you ask me. Trade it like its real!

Do you know why their is a 95% fail rate in this business? I do. And the reasons are simple: 1. New traders are lured by this idea that "this is an easy way to riches." The Market Makers have brilliant Marketing departments and they do a stellar job- believe me I have a B.S. in Marketing and over a decade in the field- I know good marketing. They shoot fish in a barrel. They tout short term trades. They WANT you to scalp for two reasons. One is the more trades you take, the more commissions they make. Secondly, Marketers are trained with psychology- they know what makes you tick- they know people and how they work. They know that even if the long term trend is bull, human nature to a "get rich quick" minded person will take tiny profits out of fear. 2. After they have baited you into doing something as silly as opening an account with $250 being as green as an Irish countryside- letting you overleverage the crap out of yourself- they part you of your $250 and hundreds of others. Knowing psychology again, they know that most people with be revengelful- they will fund the account with another $250 and take another crack at it- this time, they have you even MORE by the short and twisty's because you are pissed and want to get your first $250 back. They take you to the cleaners again! The cycle repeats over and over with millions of "get rich quick" greenhorns. 3. If after you have blown two accounts, and still want some more- you then set out on your search for the "Holy Grail." You start picking from the list of the 1000 indicators that your broker who just cleaned your clock TWICE gives you. "Must be a gift from the trading gods" you say- "all the answers are right here" you think- so you apply them, try them and eventually get parted from even more money. 4. If you are now beaten down for the third time- you can either A. Keep fighting the good fight and demo trade until you finally get it right or B. Give up on the markets all together. 5. If you choose A, you will study and learn what the markets are really all about, you will search not for "The Grail" but for the reasons the markets do what they do. You will search to find out how to read a chart instead of trying to take trades when one line crosses another or some Indicator tells you it is time to pull the trigger. You will take the hard road and work long hours to get to an edge. You will make money with your edge, and sometimes you will want to tweak the edge or realize that you can have multiple "edges" to draw money from the market. You will look at the market from a completely different perspective than you did when you started. You know that the market is not "out to get you." The market is there to do what it does- and either you are in harmony with the movements- or you are a dead man walking. The lesson: This is a hard road, this takes time, this takes patience to learn, this takes dicipline, it takes blood, sweat and tears. During your learning phase you will either crumble and give up, or you will have the heart to plow on ahead. 95%of people fail in this business because they don't have the balls to do what it takes to succeed. They don't have the gumption to fight through the learning stage to make it. PERIOD! Aaron

IMO, the words "Only" and $100K" should never be placed together in a sentence. $100K a year will set you just fine if you are working some day job for $25K and a boss breathing down your neck every day. Here is my thought with that being said. Even if you only have a $10K account to start- you can still make 150% returns-- if you have an edge, if you are diciplined to stick to that edge. If you are looking for the percentage- that can be achieved, if you are worried that because 150% to you is starting with $10K and ending the year with an account balance of $25K vs. some mega trader whose 150% means he starts with $10 Mil and ends his year with $25 Mil- well he had to pay his dues to get there. He never walked into the market trading 1000 lots at a time making each tick or pip worth thousands of dollars. Never worry about $ left on the table. If you make $1000 in a day- is that a good day? If you make $50 in one day- is that a good day? Trying to squeeze every tick out of a market is impossible. Is it possible to make educated entries and educated exits to bank money- absolutely. Lofty goals are great, to desire to be a successful trader who is a high roller- well, that is up to each individual and their desires. Remember this: Before we ever took a step on this earth, we crawled first. Aaron

Excellent points all the way around. To have one without the other is like swinging at baseballs being pitched at you in a dark room.. sometimes you'll get lucky and hit a ball or two.. but a lot of times- you are going to be in pain when those balls hit you square in the face.. and you never saw them coming!

Joe- Thanks for the post- great for new folks and older souls who need to remind themselves of a few of these items from time to time. I have been to your site a number of times and find your "No B.S. approach" to the things you bestow your wisdom upon- very refreshing! Aaron

Another Good Slug of Information from Moneybags.com.au: http://www.moneybags.com.au/article.asp?id=344

Defining an edge is, IMO, not the easiest one. Sometimes you get a legitimate edge and then tinker with it to make it better- by the time you are done "tinkering" you are completely removed from the initial "edge" and then you actually lose the edge.. been there, done it!

Quick question: Fact: We know that the Forex Market is not centralized Fact: Even "Tick Volume" on a Forex platform is debated as being useful or not Question: Is it even reasonable to attempt to use a Tick Based Chart in Forex with the above facts? Sledge

Whoo!!! The Ice Cream is Melting FAST Today in the Currency Markets. Take any currency pair today that is "going against the larger trend" Think REALLY HARD about jumping in that direction. Don't be part of the Herd! With finally a positive Fundimental print today at 1.8% higher than expected US Consumer Confidence. The herd is snatching dollars like nobody's business. And the smart money is throwing the supply out of the truck as fast as the herd will take it- but the smart money's arms are getting tired and the herd is getting full. Today looks to be a perfect day to get bargains if you have the stones to ride overnight! Happy Trading! Aaron

Holy Crap, the icecream is melting today. After a + US Consumer Confidence #, the herd decided to get as much as they could. I mean hell after months and months of nothing but crap fundy USD prints- to get a 1.8% increase in Consumer Confidence over estimate- people were looking to snag dollars as if they were going out of style. Put on your rain slickers- the slaughter awaits! Aaron

Heh, I just got done responding to you in the "Capital Protection" thread, and then bam, here is more insight to my reply. I couldn't agree with you more on this. I think the "Trend Riders" have marketed the following steps: 1. Find Entry 2. Leave it Alone 3. Close out when trend is over 4. Make millions As an "easy" and "sexy" way to trade, but I'm not sure if it is "easy" or "lazy" and if you bank money, wait for the retreat, and buy again, you get the benefit of getting paid twice when you pass the same part of the road you once travelled. Aaron

Bf- Thank you for the reply. Ok may I ask you this then: Say you enter at 1.9900 and you set a target for 2.0400. Once it gets to 2.0100, you must move your S/L to some "point" to preserve what you have already worked for though yes? That is probably the best way to phrase it. I have been working very hard to hone my entry skills. By reading price action, I have been able to gauge a neighborhood that I want to shop in for the trade. If it gets there- I take the entry, if it decides not too- no trade and I assess what I read incorrectly (but no harm no foul- I just missed the boat) EUR/USD did this to me a day or so ago, I was looking for a retrace to draw out supply, that didn't pan out-no biggie, I just missed the boat on that pair. But once I establish the position, I am trying to hone the skill of "letting it breathe" and "letting it run" Seems their is not a whole lot of discussion out there on the web about nurturing a winning position. As the vast majority of information out there on the web is pointed at the scalper and day trader sect of traders. Once I establish a position, I am looking to ride the trend. My issue at this point is when I see the price action telling me that: A. It went into the correct direction Then B. It is stalling out and will retrace. Is staying in the trade through the retrace. I woke up yesterday AM too all 4 of my positions that went trend friendly overnight in London. All showed exhaustion, but I said "Hell I'm trying to ride the trend" so I let them "be" I went home at EOD- and the $ I was up, was reduced to a about 1/5th the amount. I was not pleased. Anyways, I'm getting my own thread OT. I was hoping you would chime in as I know you are a longer term trader. Also trying to see if I leave some milk and cookies if Db will be attracted over here to join in the conversation. Much Thanks! Aaron

As we know their tend to be a few camps of traders. Within them the two camps that tend to make up the vast majority lie in: 1. Scalpers (5 to 15 min charts) 2. Longer Term Trend Traders (Daily, Weekly Charts) I am interested in a discussion about protecting capital on a Longer Term Trade and what techniques some folks may utilize. Their are a few different methods out there. Some include: (Say this is a bull trend for example purposes) 1. Move your stop up to the low of the last day 2. Use some percentage of the Average True Range (ATR) 3. Last Swing Point This is an area that coming into my own as a longer term trader has not yet been honed. That fine line between setting the Stop too high and not letting the trade breathe, and too far away that you just lost all that you had in profit. Any experienced longer term traders-- I welcome your insight and possibly a nudge in a general direction for me to do the research and work- I have no problem with that at all. I may have to run through two or 3 different "techniques" until I find the one that works for me personally. Regards, Aaron

Stellar analogy bootstap.

I found this post on "Why Screen Time Is Important" interesting and have nominated it accordingly for "Topic Of The Month July, 2008"

This is really the only part of the discussion I'd disagree with. Anyone who thinks that you can be a master chart reader and master any of these markets with a month of screentime is crazy. Whether the statement comes from Steenbarger or not-- that is bunk! Also remember that there are different groupings of people as far as learning capacity. I'll give you an example: Student A: In my years of academia, I always had people in my classes who had a natural "gift" to pick up information and comprehend the most complex subjects. They were the people who came to class on the first day, made it to class for exams and, at times, never even bought books. And these individuals did very well. They aced the classes-- to them, the subject matter came easy. It was almost "too easy" and it bored them to sit in class 2 or 3 days a week- they had other things to do. Student B: Enter a different kind of student. One who did well in courses- but had to be in class every day, had to ask lots of questions of the professor. Days before exams- they were pouring over notes of lectures, they were studying, repeating, trying to make connections of the material with something they could grasp so they would remember how to answer the question on the exam. Which person was the better student? Both students aced exams- but one had to work very hard at it, the other- it was easy. I was and always have been a "Student B" many things never came "easy" for me, I ALWAYS had to work for them, I always had to take the hard times, the frustrating times and fight through them- because the end result was that I was to garnish my degree- just like the "Student A" did. Do I wish that I had it easy? Sure! Do I wish I could honestly look at a chart and after a month say "Ahh hell I got this all figured out" and begin to bankroll millions of dollars? Well yeah, that would be nice too. But I refused to give up- My gumption, my desire, my REFUSAL to be defeated made me who I am in every aspect of my life today. Many many times in my years have people told me that "Ahh, you can't do that" and I'm the bugger who does it to spite them. The natural desire to succeed is there-but the idea that someone actually believes that I cannot do said thing- makes me want it even more! So for the "Student B's" out there- remember this: If you want this bad enough- it can be yours. This will be no different than anything in your life you have lived thus far. Aaron

True, I did try the "orientation of humping birds theory of technical analysis," created by Doctor Robin Sparrow, but it netted me about 6 pips before I gave up on it and moved along. :o So very true, I remember watching and watching and thinking- damn, this is never going to make sense.. and then all of a sudden- BAM, there it was. I find myself now looking at the EOD going "Crap, well tonight should have a mark-up and then back downward we'll go to resume the trend.. should I bank the money and re-enter or just leave it alone?" I sort of enjoy watching the sneakiness too, I am seeing more and more bars that tend to be "freak out" bars (i.e. bars to throw traders off the scent of the real trail) and it makes you sort of chuckle to see it. If anyone wants a cut-and-dry, honest post to read about Screen time- I point you to bootstrap's thread he started here: http://www.traderslaboratory.com/forums/f34/why-screen-time-is-important-4226.html Aaron

The dollar is weak right now? Holy crap.. alert CNN

Bootstrap- What a post.... again! Every time I see that you have started a thread, I run to it and listen to what you have to say today. I'd like to thank you for your refreshing, open and honest insight on this vast arena that we all attempt to play in on a daily basis. Your posts are always succinct, well thought out, and beautifully presented. You are providing a wonderful outpouring of information for any trader smart enough to listen to it and take it to heart (and implement it into their edge.) I envision your posts will become the type that a newbie trader may read it here, write it off, and in 6 months will flock back to the web in a panic to find your words once again. The posts have a way of sticking, and hopefully they'll re-discover them again (or maybe they will bookmark them now in their gathering and find them again in their bookmark list) When I read a post like this, I smile, because I have been through this very part of the forest at one point in my trading career and it resonates with me. It is a very important step in "lifting the veil" for anyone who plans to do this long-term and it makes some stellar points! You do hear the battle cry of "Screen time, Screen time, Screen time!!" but bringing up a spark to folks to say "Hey yeah, that makes sense" Just looking at it and hoping it clicks isn't enough for most. I have read countless people who make the analogy that getting your trading education is no less as intense and as hard of work as becoming a doctor, lawyer or any other profession. The analogy is true-- but at least becoming a professional "whatever" you go to a structured school, their is a well defined path that you are made to take (certain classes, partake in certain "real world" exercises to assist you in your learning.) Where trading- their is no such "school” What is out there is an internet of, literally, hundreds of thousands of indicators, trading "guru's", shady brokers, black box systems, holy grail pushers. Everyone says that it is "Up to YOU" as a trader to make it. This is indeed the very definition of the "School of Hard Knocks!" Along the way- if you are lucky, you run across people who cut the B.S. and give it to you straight (if you are willing to listen.) You also may be so lucky as to have the initiative and perseverance to not only refuse to give up when this horse throws you- but also take the "bucking" as a learning experience. Your will to "tame this stallion" becomes a goal, a hard fought goal that reaps rewards beyond your dreams- if you can stick with it and not get taken to the cleaners while you are learning. Regards, Aaron

I'd say that if you: 1. Use S/R levels as your primary guide 2. Learn to read Price Action 3. Utilize a momentum indicator as a SECONDARY verification of your price action reading skills. I think you'll be a pretty happy camper. Aaron

RMT- Honestly, for all the forum to see- I'll admit it out in the open. I strive to do this moreso than I do. If I set a trade prior to the London Open and go to bed. I have about a 94% win rate for it to hit target. But.. If my infant daughter wakes me up to be fed, I get her taken care of.. put her back to bed and go downstairs to check my platform.. I get exactly what happened last night. GBP/USD Short set at 45 pip target. 3:00 AM, I watch it run into my direction "I think EXCELLENT" but then I see the stall.. I puss out, I close the position up 10 pips. An hour later- it DESTROYS my target and I just dicked myself out of an additional 35 pips! When I am in front of it.. I tinker, I putter with it, I get spooked. The VAST majority of my major homeruns have come from analyzing correctly, setting a reasonable target, going to bed and waking up with pips in the bank. Note to self: Put this in your trade journal -- RMT just gave you a self analyzing gift! Aaron

I'll second this exact sentiment from Tawe! Sounds simple, but it is indeed effective! Aaron