Get started

Risk Management

Direction Easy✔️ Timing Hard ❌Hi Traders, I think the analysis part of trading is the easy bit. By that I mean most traders usually have the correct direction in mind but timing is difficult. AUDJPY is a classic example. The analysis was simple. Price broke about daily resistance, retested it and I was looking for continuation. I entered the trade but price came back and took me out for a breakeven. Then, it continued it same direction I expected it to. Personally, I prefer to preserve my capital by going breakeven once in good profit and I do not even confident re-entering a trade if price retraces so sharp and took me out the trade. 1. How soon do you place your trade at breakeven once it is in profit? 2. Do you re-enter a trade is it took you out at breakeven and show signs of following your original trade idea? Comment below.
Education
by UnknownUnicorn8360477
2% Max LossMoney Man has not seen the need to adjust his levels as he still stands with his original idea that ETH needs to break a pattern, clear as day on the chart, to get buyers over the fatigue. The short term trendlines are telling us this and has proven themselves as guiding pattern formation. Logic thus would change the top of Decision 1 and bottom of Decision 2 to keep these lines inside it as we go. So, he is taking this time to expand more on his ideas around risk. We all have heard about the Kelly Criterion, but also about the 2% rule (cap your losses at 2% of total allocation – the total you have allocated to trade in a particular instrument like ETH). He would classify the Kelly Criterion as an advanced risk management tool, hard to pin down within so much variance that a market has. Advanced, you say? Then that must be what a new trader should use! Not so fast. New and even older hands typically calculate their acceptable risk before admitting defeat on a trade, via back testing. Here lies the rub as more important than; the “past results do not guarantee future results” understanding – there is the lack of experience in relation to their own emotional tolerance to red. You know: the old “close winners fast and let loser run” outcome. Money Man has written about the well-known break-even parabolic horizon a long time ago and link that below. He mused then that that parabola is what sinks even brick and mortar businesses. Now he wants to give his thoughts on the 2% (used in this explanation – but could be more or less) risk to total allocation. There is another parabola hidden here (in red) and finding your sweet spot is the goal. So, your sweet spot would depend on your tolerance to loss (percentage) and its relationship to the chart / price action (distance on chart in percentage). Many traders simply trade with their whole allocation and thus sit at the far left grey bar (100% of allocation in) and far left of the parabola, forced into a 2% below entry price stop loss placement. The other extreme is a trader who only uses 2% of their allocation on any trade to trade with and have no need for a stop loss if they believe in the 2% rule. There is the option to adhere to the 2% rule and adjust your position size according to where you would like to put your stop loss. The graph above tries to give a quick reference rule of thumb and illustrates how the distance of your stop loss parabolically grows the smaller your position size. Back of an envelope math but soothing to the adrenal glands if you can find your own sweet spot. Where does the whole 2% rule come from? Money Man does not know for sure but knows that it has been around for a long time and has thus been discussed and “peer reviewed” extensively. Also, and more importantly, it speaks to another reality in the antifragility of staking your options in your favour while keeping your risks in check – an advantage you can still reap even if the percentage is too low for your liking. The reason for including it is that it could be a bridge between “betting 100% on every trade” and having a very well-developed dynamic trade size to stop loss placement distance dependent on market conditions. Please double check the math that went into the above graph before use. Remember there are no guarantees, only probabilities. Very Important to me: Please like if you appreciate the effort, Please comment and develop this further and Please follow if you see this analysis thread going somewhere you would like to know about.
BITSTAMP:ETHUSDEducation
by Rule72
3
11 Rules for the Ordinary Trader Through your trading carrier, you will learn to develop your own paths and ways to become successful in your own way, but there are many things that will give you a boost of knowledge in your trading carrier. Down bellow lists 11 different rules I have gathered from many sources. Rule 1: Price has memory. What happened the last time a stock hit a certain level? Chances are it will happen again. Watch trades closely when price returns to a battleground. The prior action can predict the future. Rule 2: Profit and discomfort stand side by side. Find the setup that scares you the most. That’s the one you need to trade. Don’t expect it to feel good until you take your profit. If it did, everyone else would be trading it. Wisdom from the East: What at first brings pleasure in the end gives only pain, but what at first causes pain ends up in great pleasure. Rule 3: Stand apart from the crowd at all times. Trade ahead, behind or contrary to the crowd. Be the first in and out of the profit door. Your job is to take their money before they take yours. Be ready to pounce on ill-advised decisions, poor judgment and bad timing. Your success depends on the misfortune of others. Rule 4: Buy at support. Sell at resistance. Trend has only two choices upon reaching a barrier: Continue forward or reverse. Get it right and start counting your money. Rule 5: Manage time as efficiently as price. Time is money in the markets. Profit relates to the amount of time set aside for analysis. Know your holding period for every trade. And watch the clock to become a market survivor. Rule 6: Don’t confuse execution with opportunity. Save Donkey Kong for the weekend. Pretty colors and fast fingers don’t make successful careers. Understanding price behavior and market mechanics does. Learn what a good trade looks like before falling in love with the software. Rule 7: Control risk before seeking reward. Wear your market chastity belt at all times. Attention to profit is a sign of immaturity, while attention to loss is a sign of experience. The markets have no intention of offering money to those who do not earn it. Rule 8: Big losses rarely come without warning. You have no one to blame but yourself. The chart told you to leave, the news told you to leave and your mother told you to leave. Learn to visualize trouble and head for safety with only a few bars of information. Rule 9 : Enter in mild times, exit in wild times. The big move hides beyond the extremes of price congestion. Don’t count on the agitated crowd for your trading signals. It’s usually way too late by the time they act. Rule 10: Perfect patterns carry the greatest risk for failure. Demand bruises on your trade setups. Market mechanics work to defeat the majority when everyone sees the same thing at the same time. When perfection appears, look for the failure signal. Rule 11: See the exit door before the trade. Assume the market will reverse the minute you get filled. You’re in very big trouble when it’s a long way to the door. Never toss a coin in the fountain and hope your dreams will come true. Yours truly, Jacob Schildcrout **Note, I dont take credit for these rules, these have been gathered from sources for your convenience***
COINBASE:ETCUSDEducation
by JacobSchildcrout
3
How To Trail Stop Loss Effectively | Capture All day's ActionMaximise your Day Trading Profits 5X | Apply this trade management system to hold trades all day without much effort In this video I'm going to share with you a trade management idea which would allow you to trade and hold the trade from the start to the end of the day trading session. The Chart I'm using is US30 / DOW30. The Time frame for day trading would be the five minute chart. The idea is to make entries on the 5 minute chart and then use a few swings to add on. This can become part of your Trade Plan and you can apply to any time frame or symbol of your choice. It's a great way to maximise your profits using nothing but the data provided by the market itself. Price Action is surely The King!!! I bow....
OANDA:US30USDEducation
by iTradeAIMS
8
PATTERNS & PITFALLS #1 The market is designed to make you fall into traps, and make you doing things. By nature, we tend to overcomplicate things and trading is one of them. As in coding, the best way to code is to Keep It Simple Stupid (kiss). One of this thing is what i call “The Home Runs Chaser”. A large majority of retail traders, slowly tendto look everyday for a stock heading up to the moon. Why does this happen? How we slowly enter into that thinking process when we start trading? So you start trading for few days or few weeks, you see a stock on an uptrend and you go long, take money and then you see the stock going up fast after you exited, what do you tell yourself? “Damn it, i should have held it a little longer, if only...” And then it happens a few more times, and BINGO you’re in it, you’re in the trap designed by the stock market: - You start looking everyday for home runs. - Now you have the “win or loss” mentality So you allow yourself to lose it. You see gains but you’re focusing on the holy grail, the holy target! LOOKING FOR HOME RUNS WILL LEAD YOU TO NOT GETTING PAID !!! Plus it will frustrates you a lot because most of the time, you won’t have the home run. => We must enter the right way of course, as usual, BUT BUT BUT, we must take quick wins when it’s on our side. => Sometimes we have low wins when the stocks have low momentums and sometimes big wins if they are big. But at every trade: you should take partial profits along the way. Exemple: you enter long in stock XYZ at 20$ with 100 shares. Your target is 22$. Instead of waiting the price to reach 22$ to sell your 100 shares, what you should do is to take partial profits. So at $20.49 you sell 25 shares, then at $20.99 you sell again 25 shares. If it goes over 21$ then you wait for the price to reach 21.30 to sell again 25 shares BUT if the price goes back to 20.50, just sell 25 shares to secure a bigger win. The remaining of the 25 shares are sold at ~ $21.97 in the case it goes up, or sold at ~ $20.20 if the price drops. That’s how you secure a win and not let the trade goes against you..... And if you have to leave your computer, just use the trailing stop with an ok spread between the price and the stop just not to be stopped too quick if the price moves down a bit before going up.
NASDAQ:UPSTEducation
by youssHark
Ways to solve our overtrading issuesHello, I have an overtrading problem. There are solutions, they are just not on the internet on trading websites. They come up with the same useless nonsense you'd expect "take some time off the screen", "don't try to get rich quick", "defeat your overtrading", "get motivated get a plan and force yourself to stick to it", "be patient" 🤦‍♂️. What is next? "Brush your teeth be a good boy and do your homework"? Or even better "do not overtrade". My brain doesn't care that "less is more" my brain is thirsty. Really there is no such thing as "placing the threshold here". There is not such thing as "not (under/)overtrading". You always either overtrade or undertrade. If we want to compare this to drawing a line, or in other words placing a barrier, it would be like placing a barrier but not 2 or 3D, there would be 20 dimensions, and all opaque, and ever changing, and you do not know which one is more important which one is less. Good luck learning by heart how to do it in a book. Of the past 5 months 4 of those had nearly no good setups for me, it was very hard. I can't just do nothing. So I took really terrible setups. Way too many. Ok let's skip the excuses. Even if I am not trying to go only for the ideal stuff at all, I've been taking way too much, I went through my logbook and I would say I took 2-3 times too many. We want to compete, we want to play the game. Most people, and most people this idea is targeted to, are at an intermediate level to advanced. Beginners that do not even have an edge well overtrading is not really hurting them is it. They do not give back profits, there are no actual profits to give back! A word for beginners. Since we're going to end up investing anyway aren't we? Well perhaps they might as well start with managing a simple low risk portfolio. Build a solid base. Might as well start with the easiest part. Least difficult. And might help avoid overtrading from the start. If I could start over I would not hesitate. Once an intermediate has his niche, a few currencies, his favorite websites & tools, and an edge, well that just won't do will it. There is no resting on laurels until we really have plenty of knowledge, strategies, instruments we can handle. Constantly look for more edges. And progressively widen the business with more currencies. Can also add commodities. With time the base grows, like a strategy game. Might want to test the new strats on a separate low stakes accounts while running the core one on the real account. A player with several edges, and a wide array of instruments, as well as a couple years experience, is what I'd call advanced. At some point if we try adding even more instruments or strategies we'll just mess it up, it takes enough time to manage our vast business already. And after several years the strategies sort of come without looking for them anyway. Plus the markets do not have infinity opportunities to offer. Just keep doing research, improve your understanding of the market, keeping updated on everything... A serious advanced trader will be busy, no worries here. The issue is there are not enough opportunities. We want to compete, we are eager to fight. If nothing happens in the market, price is just random as far as we know (only retail day gamblers will say it's not and we know how well they perform), what to do? Well there are some tricks: - First use and abuse adding to winners. If you're going to overtrade anyway, might as well do it with a winner than some choppy garbage. Not ideal, use this in last resort. Adding to winners should probably have some rules to it. Better to have bigger winners than more losers. - Go manage a portfolio on the side, invest a little / position trade. And when the urge to take a trade comes, find a good winning investment and add to it. I would not start dreaming of adding and adding and adding to Forex, but with stocks, sure. Buying an additional S&P call is like taking a new trade. Better this than gambling on 2019 EURUSD. - If you have a severe addiction and just can't help it, well... I guess in last resort there is still the option of going day gamble on the side, but this should not take your attention from your main business. This can easily eat up time & focus, and mess up results without adding anything positive.
Education
by MrRenev
1
5 Strategy - To help you towards your long term Financial Goals!Hello Traders, Newbies & Fellow Friends! Today I decided to post this Educational & Motivational Post for Everyone to Read! I hope your Enjoy this Journey with me! Before we start! Id like to mention a few Things: Financial Freedom is Not an amount of money , Its a state of mind! Trust Your Brain, Not Your Gut - "When things are going well, people think it’s going to be springtime forever,” & “When things are dark and stormy, they think it’s going to be wintertime forever. But I’m a student of history, and it’s always cyclical." Cultivate Patience - Mastering your finances is just like mastering your mindset—it doesn’t happen overnight. It takes years, if not decades, to see a true transformation. “I think the secret to patience is knowing what your outcome is and focusing on still making progress, It’s about momentum and being a student of what works.” These five strategies can help you stay on track toward your long-term financial goals: 1. HOME in on what matters! Be strategic about the financial news that you consume. If you are trading on the Forex Market, there’s no need to check your chart every 10min. You will only drive yourself crazy. Instead, spend those 30 minutes doing something valuable like reading a book or watching a YouTube channel (Global Fx Education) about a financial strategy. “We’re drowning in information but starving for wisdom,” “The only way to stay strong and centered is to be clear on what you want to serve, stand guard at the door of your mind, and make sure you’re feeding your mind something besides Nonsense. - invest in yourself!! 2. LEARN to be comfortable with risk! Even the safest trading conditions have a level of risk—tolerating it is simply part of the game. “Risk is the secret to success,” “If you want to succeed at any level— in Forex Market, in your contribution to the world—you have to learn how to deal with this four-letter word.” Trading should be based on goals and what we’re trying to accomplish,” 3. FOCUS on what you already have! High achievers always tend to focus on self-improvement! But if you’re always focused on what’s missing, you’ll never be able to attain true happiness. 𝗖𝗵𝗮𝗻𝗴𝗲 𝘆𝗼𝘂𝗿 𝗺𝗶𝗻𝗱𝘀𝗲𝘁 to focus on what you do have: Perhaps you don’t possess enough money to travel and donate as much as you would like to charity, but you do possess enough to pay for a sizable share of your child’s college For Example. That’s big! 4. DON’T MAKE impulsive decisions. If you find yourself tempted to make rash decisions with your money, you’re not alone. “Humans aren’t really wired to be great investors; it’s just not the way we are built,” we often make decisions based on emotions or intuition rather than facts.” 5.KNOW your limits! The world’s most skilled investors didn’t make it big due to one or two lucky investments—they’ve spent their lives learning how to be the best at what they do.! Like an wise man always Told me - Rome wasn't Built in a Day, Take careful consideration in everything you do. Notes - Adjust Your Worldview With the volatility of the Stock market & Forex Market, political division across countries and unpredictability of the pandemic, it can often feel like we’re living during a terrible time in history. But a little dose of perspective can remind us that’s not necessarily the case. It’s human nature to see things with a negativity bias, But it’s important for Investors / Traders to have an optimistic outlook on the world. “If you accept that it’s a great time to be alive—life expectancy is going up, the population is growing, we’re innovating and we’re getting better every year—then that’s the kind of place where companies / Assets / Markets can thrive,” “And if they thrive, you’re going to do well as an investor / Trader.” Those who choose to view the world through an optimistic lens will prosper, Remember this - “Some people freeze to death in the winter,” while “Others learn how to snowboard and spend time with their family by a warm fire because they know winter is not forever.” Thank You All For Reading This Motivational / Educational Post! I hope it Has changed Your View / Trading Psychology For the future! I have Left my Previous Educational Posts Below! Something Great to do today - Like, Share this Post, Leave me a comment Below! Global Fx Education Stay Safe!
SAXO:XAUUSDEducation
by Global_Fx
3
Think like a Hedge-FundImagine that you are a Hedge-Fund manager, you have a lot of money to invest. You are looking to invest in AAPL for example. Let's assume for the debate, that you as a fund manager can buy any amount of stock that is traded that day. This assumption is made because we want the Anchored VWAP to represent our position line. Anchored VWAP = is a tool that you can use that calculates the average price of volume that was traded from a certain point. In practice, since you don't have a lot of money, if you could buy 1/100M stocks each day (100M is avg volume, which means you will buy /100M), your position line will be very similar, but proportional to a private account. You decide to grow your position line when the price is after a big correction and it moved above the EMA. You go only LONG, you buy every stock that is traded (you are a Huge hedge fund manager, remember?) Path 1: You start to accumulate a position. Your position line is growing in size, but it also rises in price since you are buying stocks at a higher price. In green, you can see your position line which is also your break-even line. As you can see, the price is always above the green line, which means that you are in GREEN all the time while you are in this buying campaign. Path 2: The light blue line is where your position line will get "stuck" and will not rise if you decide to stop and not add more to your position from that point in time. Path 3: Path 3 is your position line given that you keep adding to your position even in the sideways action. You just keep buying and buying. Red line: The red line is the Anchored VWAP that will be if you want to start selling all your position. You sell every day and keep selling. This is your average selling line. Conclusion: You can see that either if you choose path 2 or 3, you will all the time be in GREEN position. If you choose to stop buying and start selling (Path 2), your average return on the position will be 32%. You entered little by little, minimum risk in the position. You have a lot of "AIR" from path 2 to where the price is currently in. This post is a continuation of the post about average-up strategy. The same line of thinking. If you like, follow and like this idea so it will be saved in your saved ideas for future reference.
NASDAQ:AAPLEducation
by ZoharCho
1
Mitigating High Risk Long Positions with CoveringStop losses are an, often unwelcome, but ultimately necessary and life saving tactic to day trading. When going long, setting a high stop loss can be beneficial for getting out of bad trades quickly with small losses, and opening yourself up up more opportunities for good trades. Setting a low stop loss on the other hand, can be beneficial by greatly increasing your profit. Many trades that seem bad initially end up rallying and turning profitable. Generally speaking, the lower your stop loss, the higher your percentage of good trades. The downside to a low stop loss of course is that trades take longer, locking your funds up, and what if price actually hits your super low stop loss? You've lost a super amount of money. In my trading career so far, I've preferred a low stop loss. Losing out on a good trade due to a conservative stop loss is more painful to me than the risk presented by a liberal one. But this is a high risk to accept. Losing, say, 20% of my trading capital is definitely something I want to avoid, but not at the cost of a high stop loss. So, I can hedge my position, mitigate my risk, in one of a few ways. I can open a short position when I see my long position go south. Or I can engage in Dollar Cost Averaging: I buy more as the price falls to lower my average position size and ultimately my target profit. These are good options, but come with their own side effects. Opening a short position opens you up to risks associated with a short position, i.e. price suddenly shoots up. And Dollar Cost Averaging requires additional funds to keep buying. What else can I do? Enter "Covering". From Investopedia: "To cover is to take a defensive action to lower the risk exposure of a position" The graph attached here is a demonstration of Covering (the exact spots for buying/selling were picked hastily; this example is purely conceptual and an ideal situation). The basic idea is: when price begins to fall, sell it, just like a stop loss. However, unlike a stop loss, the intention is to buy back in at a lower price when price begins to rise again. This is like dollar cost averaging, because you're, in a sense, lowering your average position size. The difference is you don't need additional funds. This is also like short selling, because you rely on the price continuing to fall, but you haven't borrowed anything in order to benefit from this fall. As you can see in the diagram, as you sell and buy back, the amount of shares/coins/whatever you can afford off your initial capital increases, thus either increasing your profit if the trade hits the profit target, or decreasing your losses if the trade hits your actual stop loss. Here's how Ive been setting up my covers: When price begins to fall, I set a conditional market sell somewhere below the nearest support. If price falls to this level, I immediately sell everything Once I've sold all my shares, I set a trailing stop loss for the cover; I generally do ~1.2%. If, after I sell, price rises 1.2%, I buy back as many shares as I can with the money I got from selling earlier. Ideally, this trailing stop falls well below where I sold. Rinse and repeat until price either hits your original take profit or your original stop loss. Some things to note. Do not buy below your original stop loss! The purpose of this strategy is to respect your original decision, not make new ones . This is meant to mitigate a high risk situation, don't expose yourself to more risk in doing so. Also, you theoretically want to buy back above your original stop loss, even if it looks like it's going to fall through. Make your own call here, but by not buying back, you've essentially just changed where your original stop loss is, and thus changed your original trade decision. Of course, nothing is without its own risks. It's quite possible that you get stopped out for a loss every time you sell, i.e. you sold, price went up, so you buy back at a higher price to stay in the trade. This will eat into your profit if the profit target is eventually hit, or simply add to your losses if the stop loss is hit. From my point of view, that risk is less painful than the risk of hitting a low stop loss without covering. You theoretically give yourself more chances of being right with these micro trades inside of your larger trade, and if you get lucky, as is the case in my diagram, you might actually profit even if your original stop loss is hit. This strategy requires attention, for sure, but if you're both strategic and lucky, you can really save yourself from the downsides of a high risk trade without adding money to the pool, or exposing yourself to short selling risk.
COINBASE:COMPUSDEducation
by tapRoot_coding
1
Risk Management (Lessons & Tips)Understanding Forex Risk Management Speculating as a trader is not gambling. The difference between gambling and speculating is risk management. In other words, with speculating, you have some kind of control over your risk, whereas with gambling you don't. Even a card game such as Poker can be played with either the mindset of a gambler or with the mindset of a speculator, usually with totally different outcomes. However, no trade should be taken without first stacking the odds in your favor, and if this is not clearly possible then no trade should be taken at all. First rule in risk management is to calculate the odds of your trade being successful. To do that, you need to grasp both fundamental and technical analysis. You will need to understand the dynamics of the market in which you are trading, and also know where the likely psychological price trigger points are, which a price chart can help you decide.Once a decision is made to take the trade then the next most important factor is in how you control or manage the risk. Remember, if you can measure the risk, you can, for the most part, manage it. Trade only during times of day of high liquidity and volume in Forex market, which is from end of Tokyo session to end of London sessions each day (around 12 hours). Risk per Trade Another aspect of risk is determined by how much trading capital you have available. Risk per trade should always be a small percentage of your total capital. A good starting percentage could be 2% of your available trading capital. So, for example, if you have $5000 in your account, the maximum loss allowable should be no more than 2%. With these parameters your maximum loss would be $100 per trade. A 2% loss per trade would mean you can be wrong 50 times in a row before you wipe out your account. This is an unlikely scenario if you have a proper system for stacking the odds in your favor. The solution to trader risk is to work on your own habits and to be honest enough to acknowledge the times when your ego gets in the way of making the right decisions or when you simply can't manage the instinctive pull of a bad habit. The best way to objectify your trading is by keeping a journal of each trade, noting the reasons for entry and exit and keeping score of how effective your system is. In other words how confident are you that your system provides a reliable method in stacking the odds in your favor and thus provide you with more profitable trade opportunities than potential losses. Conclusion Risk is inherent in every trade you take, but as long as you can measure risk you can manage it. Just don't overlook the fact that risk can be magnified by using too much leverage in respect to your trading capital as well as being magnified by a lack of liquidity in the market. With a disciplined approach and good trading habits, taking on some risk is the only way to generate good rewards.
Education
by Anbat
How To Get Out of a Good Trade? - Setting Your TPHi Traders, today's topic regarding 'How To Get Out of a Good Trade? - Setting Your TP' . Are you still struggling to set a proper profit target? Or are you still watching some of the best trades reverse against you? It can be frustrating sometimes watching some of the best runners turn into a breakeven OR losing trade. These are some of the methods I personally use to get out of a great position ( Trade Management ) 1. Technical levels (S&R zones) - This is mostly related to 'set and forget' type setup, you identify everything before hand, set your TP at key levels (broader thesis), leave it to run. But one thing when you're setting your target at key levels, you have to first understand the market condition then compare it to the current volatility. Eg. if the market is in a choppy range and you're setting your target at the all-time-high, it makes no sense (unrealistic) . - Also know that S&R are zones, so if you're setting your target at the absolute tip of the resistance, there'd be times where market just reverse against you, because mostly likely you've neglected the " zone " factor 2. Trailing Stops (Moving averages OR Prior high/ low) • Moving Averages This is great when you're looking for an extension sort of market movement, such as trading a flag/ exhaustion pattern. You're betting that the market will keep banging into your intended direction. How to trail it? You must first Identify the strength of the trend - Medium OR Weak trend (deep pullback) = 50ema to trail it - Strong trend (shallow pullback) = 18ema to trail it • Prior high/ low This is great when the market is in a strong trend, and your thesis is telling you that it MUST respect the higher highs & higher lows/ lower highs & lower lows sequence - Go down to lower timeframe such as 15m, everytime when price forms a minor level, trail your stops to that structural area - This method also helps you to keep track with the fresh momentum If you're constantly watching the market reverse against you, there few main issues are - You're having your target way too far (unrealistic TP), identify the daily ATR, then understand the probable and possible. - You're looking for an extension move in a ranging condition (market isn't going to keep ripping into one direction, there will be times where it ranges, this is when you MUST have a realistic target such as setting them at previous swing high/ low) 3. Fixed RR This is great if you're looking for a more systematic method to handle your TP & emotion at the same time - Eg 1:3RR - But by using this method, you'd somehow decrease your long-term expectancy as you're getting out of position way too soon sometimes - Yes you do eliminate some effort to figure out your TP in every setup, but you'd tend to have many ' re-entries ' too, as the frustration of getting out of a good position too early is overwhelming too. Feel free to comment below what's your worst nightmare in trading! "I know where I'm getting out before I get in." - Bruce Kovner Trade safe as usual. Do follow my profile for daily fx forecast & educational content.
KRAKEN:BTCUSDEducation
by TraderNeoh
33
Be Realistic ! there are always alternative scenariosit is vital for all traders to control their emotions. getting excited is natural for everyone but if you want to be a successful trader you have to learn how to control your feeling. we trade based on the facts not feelings!. there are always alternative scenarios and a wise trader should be prepared in advance. being aware of alternatives can help you to control your feelings and manage your trade well. one tool to manage the trade is using Multi Unit Trade Strategy which will be discussed in another separate post. Here I want to introduce some alternatives for market path when a trader enters to a trade after an ABC correction . First I should emphasize that I used BIDU chart just as an example and I do not claim that BIDU will follow what has been shown on the chart. Alternatives after a possible ABC corrections are: 1- starting a new impulse wave and making a new major high : traders hope for this scenario and enter into the trade for making noticeable profit but does it always happen? 2- what we consider a wave C is not actually what we considered and it was in fact wave 3 of a descending impulse wave. experienced traders have faced this scenario many times. I showed this possible scenario on the BIDU Chart. 3- Stock may make a flat correction. this alternative has been drawn on the chart and you can see it's internal structure. flat corrections can be very misleading. be cautious !. 4- Dobule or triple Three correction. this scenario may pose huge loses to unexperienced traders when they feel correction is over and they see market is going up but suddenly every thing will change. Also recognizing a new entry point is not so easy in this type of correction. an example of a Double Three Correction has been shown on the chart. Good Luck Friends
NASDAQ:BIDUEducation
by SaeedSajedi
4
5 Tips for Newbie Trader💯1. Two dangerous extremes On the way to making a stable income in the financial markets, newbie traders face two extremes: a) First - you can learn a lot and for a long time, but you still can't go to real trading. b) The second is to start without knowledge. Both paths lead to failure. By the way, it is the traders who have lost funds from ignorance of the principles of trading, and mainly create a negative image of the financial markets. You can't make money without knowledge! And to separate the process of gaining knowledge from practice too. Therefore, a beginner in the financial markets must both learn and practice. 2. Best instruments to trade for a newbie trader Now forex brokers provide a wide range of financial instruments within one trading platform: currency pairs, CFD contracts on stocks, futures , cryptocurrencies, commodities ( oil , gold , silver , etc.). It's easy for a beginner to get lost in this variety. In order to facilitate the choice, study separately the features of the different types of markets. 3. Trading psychology: the third pillar of successful trading An important factor to pay attention to when reading books for beginner traders is the ability to manage your own emotions. Trading is an amazing area. All your habits, behavior patterns, strengths and weaknesses of character are immediately reflected in the trading account and bring results in monetary terms. So you either earn or lose. Newbie trader, faced with a storm of emotions in the process of trading, should know: he is not alone. Most traders experience the same feelings, and those who have been making money in this area for a long time have learned to turn them to their advantage. And we are ready to share tips. 4.What a beginner trader needs to know about money management You already know that trading in financial markets is a high risk area. However, this risk is completely manageable, and if you know how to do it, you will be able to earn consistently. In addition to a profitable trading strategy, a trader needs an understandable money management system and competent risk management. The safety of your account depends on them. Here are the ingredients for a good money management system: a) Stop loss. It must be set correctly, according to the requirements of the market and your trading strategy. It will allow you to reduce your risk if your prediction turns out to be wrong or out of date. b) The ratio of risk and reward in each trading position. Usually trading strategies provide for it at a level of 1: 3 and higher. The minimum allowed ratio is 1: 2, only then the deal makes sense. c)The volume of the trade entry. Along with a stop loss, it determines how much or a percentage of your trading account you risk on each trade. d) Risk per position. Based on the mathematical expectation of a trading strategy, it is necessary to decide what percentage will be the maximum risk in each transaction. The smaller it is, the safer your trade. 5. Trading and life: how to organize your work So, you have decided to start making money through trading. Motivating pictures with a trader who sits under a palm tree with a cocktail in his hands and spends an hour a day to check how profit is dripping into his account - this is clearly not about the start of a career. At the very beginning (and eventually too) you need to have an organized working day for trading. 1) Set aside time on weekdays that you will devote to trading. 2) Do not combine it with other activities: dinner, watching TV series, spending an evening with your family, etc. Trading requires extreme concentration. 3) If you are a beginner, take the study plan presented in this article, allocate the stages in time and systematically, without scattering, move along it to your first profit. 4) Before you start trading, do a market analysis every day. ___________________________________________________ P.S. Can you add more, wolves?🔥
HITBTC:CRDTUSDEducation
by Berzerk_invest
9
The Importance of a Trading Plan - How To Create One?Hi Traders. Today's topic is regarding 'How To Create a Trading Plan?'. Throughout my personal trading career, trading plan is often neglected by majority of novice Traders. A trading plan shouldn't be something complicated and heavy, simplicity is the key. Set realistic objectives and checklists that you are able to stick to it strictly on a daily basis. These are some of the important elements should be included 1. Instruments Know which instruments you are trying to focus on. In your earlier phase, focus on one instrument, really dig into it, put in the work to master the craft. 'Diversification may preserves wealth, but concentration builds wealth.' - Warren Buffett 2. Timeframe Multiple timeframe / Top-Down analysis is vital, it allows you to identify the long-term trend & short-term sentiment. But avoid distracting yourself with too many timeframes OR irrelevant timeframes. I'd always suggest to not look at more than 3 timeframes. A. Entry timeframe: Identify a timeframe that you'd find your entry triggers and place your trade, such as 5-30m charts (Lower timeframe) B. Analyzing timeframe: Identify two higher timeframes that'd allow you to view the bigger picture better, such as 1h - 4h charts (Higher timeframe) Eg. If you are a scalper, it is pointless for you to analyze the weekly chart. Eg. If you are a swing trader, looking at the 5m chart could be too intensive for your brain. 3. Risk Management This is the most important aspect that'd determine your long-term profitability. A. Risk per trade: Percentage-based risk is the most common method to manage your risk, such as 1-2% risk per trade. B. Maximum daily & weekly drawdown: Identify what's the worst scenario you'd allow yourself to sink into. There will be times where you are trading on tilt, things just get worse. This is when your maximum drawdown comes into play, pulling yourself out of the emotional vortex , prevent yourself from those irrational behaviour. 4. Personal Strengths & Weaknesses Explore your personality. Trading is about knowing your strengths & weaknesses, then leverage them into your advantage. There's no way you can completely eliminate emotion in trading, we're all human. But what's more important is to organize your mind to control its performance. A. Aggressive: If you're an aggressive trader, focus more on a trending condition, you should probably avoid the sideway condition (over-trade/ revenge trade tendency) B. Conservative: If you're an overly conservative trader (fear & hesitation elements), you should probably reduce down your checklist and simplify your trading system. 5. Strategies/ System This relates to your personal strengths & weaknesses too. Develop strategies/ system that suit your personality the most, then keep improving it. Identify which market condition you're the best at (Trend/ Range/ Channel), then develop successful strategies to capitalize on these market states. 6. Routine/ Action Plan Successful Traders tend to find trading to be a 'boring' process, they simply scan through charts, identify setups that fits into their criteria. Have a set of routine, simplify them and stick to them everyday even if you feel lazy. Eg. Spend 1h per day to analyze the market before you jump onto any trades Eg. Journal your trades every night Eg. Spend 1h per day to review & reflect your progress If you still don't have a Trading Plan, take action and create one now! 'Success comes from consistency, not what you do occasionally.' - Neoh Trade safe as usual, keep your risk managed. Do follow my profile for daily fx forecast & educational content.
KRAKEN:BTCUSDEducation
by TraderNeoh
6
How to identify a correction for the next impulse move ? How to identify if a correction is finished/completed and ready for the next impulse move ? Hello everyone: In this educational video I will go over how to properly identify a correction in price action analysis. I recently made a price action workshop live stream video that went over everything on impulse - correction, structures/patterns, continuation and reversal corrections, but I still get a lot of questions on identifying corrections itself. How to draw, use the trendlines to identify a correction, and how to understand they are going to complete/finish. In my opinion this is the most important part in technical analysis. We need to understand that the market moves in phrases, it can only be in the impulsive phrase or corrective phrase. The key to trading is to understand when a correction finishes, we are going to get the impulsive phrase which will give us traders a better edge in the market to enter, where the momentum is strong. I have made many educational posts on price action analysis, specifically on continuation or reversal correction, which I will put the links below. Any questions, comments, or feedback welcome to let me know. Thank you Jojo Price Action Workshop www.tradingview.com Impulse VS Correction Continuation and Reversal Correction Multi-time frame analysis Continuation Bull/Bear Flag Reversal Ascending/Descending Channel Reversal Double Top/Bottom Reversal Head & Shoulder Pattern Reversal “M” and “W” style pattern Reversal Impulse Price Action Expanding Structure/Pattern
BINANCE:BNBUSDEducation
by jojofang0901
62
Daily Strategy (50 pips risk/100 pips reward) As in all strategies, please back test for yourself. This strategy will give you around one setup on daily charts per week around. You should look at several pairs for ones which daily candles are showing a two or three day Harami, Engulfing or Pin bar set up (which are high reversal patterns). Noted on this daily chart of GbpUsd chart are four trades, which three are sells and one is a buy trade. These trades would be entered on close of session (after the 1st hour of new session: why? because 1st hour of new session has very high spreads- so wait for this one hour candle to close to enter your daily bias). Risk Reward on daily would always be 50 pips stop and 100 pip target or 1:2 RR 1) These trades might last for one to three days around- so extra charges could incurred. 2) Wait for either a two or three day harami, engulfing or pin bar candlestick pattern( yes harami and engulfing candle can be more then two with blended candlesticks< please you tube if needed) to happen, then enter after 1st hour of new session with a 50 pip stop and 100 target. Trade your plan and use right risk management,especially related to using a 50 pip stop loss. Maybe, use lower lot sizes then normal standard lot size unless that is part of your plan. Purple vertical lines are alert candles, before entry candle happens Red arrow means sell trade and Green arrow means buy trade These trades can last from one to three days, so mostly not for scalping or day trading- but swing trading. Good Luck and Good Trading.
Education
by Anbat
How to stick to your trading plan / not close early trades.Once you have your strategy on how to grow your account, risk managment and your watchlist. The only problem is a traders psychology. You could have problems with closing early trades in loss/profit becase you are scared it might go south. To answer this, you have to change your mindset. Once you have done the analysis on the chart and you make that trade with the take profit and stop loss, just dont look at how much you are earning/losing. Focus on the chart and what is happeing. You didn't make the trade on numbers from your account but on candles on the chart. Make yourself think that you cant close the trade until it hits that stop loss or take profit. You WILL take loses, most day traders don't make it profitable. If you had the confidence to make that trade KEEP the confidence during your trade. If you don't belive in your own trades and that you can make it as a trader, why would anyone else? Profesional traders take loses too. No strategy works 100% of the time.
FOREXCOM:XAUUSDEducation
by fxAljtaric
Drawing Support and Resistance Using Multiple Time FramesHi all, Here is a quick tutorial on how I draw support and resistance lines. A few things to keep in mind are use multiple time frames to get a more comprehensive understanding of trend and to determine which lines are more significant than others. Also, by using these lines you can set more accurate limit orders and save money by not having to pay extra fees for market orders. It is important to NOT enter long positions as we near areas of strong resistance. We should be taking profits at those levels and entering longs when approaching lines of support. Additionally, this allows you to set a tighter stop loss because if the line of support is rejected then it invalidates the idea that the asset is increasing in value. Of course, you need to use indicators and do a more comprehensive analysis but this should be a helpful tool to help you manage risk. I plan to make more of these videos laying out trend lines, dynamic lines of support and resistance, fibonacci retracements and spiderlines etc. If there is anything you want me to provide a tutorial on please leave a comment and I will get around to it as time permits. Best, Brad
BINANCE:LINKUSDEducation
by Brad_Perkins
2
10 ways to speed up the process & improve our bottom line1- Get good: make sure you spot patterns and avoid mistakes by practicing First of all obviously, and I did not find this in the "how to improve performance lists" I looked at on the internet, obviously you want to avoid mistakes as much as possible and also we want to make sure we never miss out. So every single day checking the news and/or charts and any other source we may find helpful. And then also regularly going through past trades, taken or backtested, going through the whole process, and even using tradingview replay button on past price action to train our recognition skills, learn to not fomo in, and more. The first 5 years are the hardest they say, and then the price action pops out more easily.  2- Get good: keep reading and learning I'm sure many if not most ideas & strategies see their first spark when we just spend time reading about markets and looking at charts without specifically looking for a strategy, it just comes naturally we spot patterns with time. So keep spending time taking an interest in everything, when you get a little light appear over your head go check if it has any value if a strat can be derived out of it, and this all should just happen by itself over time.  3- Trade lower timeframes, higher timeframes You could get into statistical arbitrage, crypto arbitrage and market making, or any other short term activity. The barrier to entry is here, the skill floor is not down to zero, so there is a large investment to make just to get started. If you are currently hardstuck, it might be interesting, probably not very, from what I have seen most of the money is made using expensive technology and day trader data to take money from the usual retail victims (100% of day traders are "retail" traders). But if there is a bone with a bit of meat left and it's not too much effort for the reward, even getting an extra 2-3% a year might be worth it. Another solution, more intelligent but less attractive to the average "retail" beginner is to look at higher timeframes. One could have no short term activity on a currency that is very choppy and very slow but take a long term position and get a little bit of extra profit. Also with aiming for long term when possible we can get more out of the market, bigger winners (more "pips") = more profit, and spreads become insignificant.  4- Build another business It can take the focus away, the smart entrepreneur will avoid getting too ambitious and beign a jack of all trades master of none, if one is hopelessly stuck at a ceiling they can't breakout of it could be a good idea to stop forcing and look somewhere else, the ceiling might be easier to break later on. A business can add more stable cash inflow, reduce risk and net worth or income volatility, and keep us from tearing our hair out when we aren't getting the amount of setups we want in the markets.  5- Increase position size Go big like Bill Hwang, then blow up like Bill Hwang. This guy over the years (15 years I think) made more than 60% a year return without much people knowing about it as he was running a family office, he grew in 8 years if my source is correct 200 million into 10 billions. At first he tried to speed up the process by cheating, he got caught up in several insider trading scandals so then he tried something else which was leverage. And blew up. His positions being so big makes it even worse, and being concentrated, such a whale exiting crashes these stocks completely. Even the big company Baidu lost 50% of its market cap. Us plebes don't even come close. Even a "large" 1 million dollar account is 1/10,000 th of his 10 billion. I am not encouraging anyone to be a degen gambler I'm saying someone that lives in the west and has been profitable might think "I am willing to risk these 5000 euros", such an account can be built back even by simply working at mcdonalds for a while. The gambling type that risks everything is not the type that ever manages to be profitable. Still, while small we might want to take on a bit more risk, a reasonable amount, to hopefully speed up the process a bit. But this is not the only tool and used after all the other stuff improving etc. So here's perhaps an idea to be looked at. Several companies share prices dropped massively, that's not some legit regular price discovery, the price was destroyed because of a whale causing a fire sale. The term "oversold" could maybe be applied here. Where are all the retail gamblers? Aren't they buying this time? They always chase crashes. Scared? Or maybe too small, or maybe they sold already when the price slightly bounced and they were up 1% LOL!  6- Improve a strategy RR & WR OR allow for a lower PF but get more signals Once you have a working strategy you still improve as an investor but the strategy itself should not be getting optimised all the time or something is wrong. Until we get it right we keep backtesting and working out the contours and details of our strategy, we insist on it to trade it correctly like improving a skill, then once this is done we look for something else and just run it making sure to still give it some time.  7- Add another strategy An obvious way to get more setups hence more profits is to get a new strategy, but this is done only when the previous one(s) is mastered. You can expect this to take 3 months to a couple of years. And it can interfere with your focus of the other one, it can also be somewhat correlated so have to watch out for that. It is a big project. Does not mean we can't always be on the lookout for new strategies and new knowledge, just don't always try trading new strategies, just put the "potential" ones in a corner of your head (and excel DB) and progressively come back to it until at some point after months or years you gathered enough info and really get into it all in. There are several strategies, for stocks in particular I have been looking at, for example I have been posting here and there on this site about the "dead stock bounce" thing but I never traded it, maybe one day I'll start doing so. For now I still have a whole lot to learn about Forex plus a couple of commodities. The easier way to avoid correlations and other troubles is to have a strong trend following strategy, and then another one for other scenarios. And of course when you end up taking a trend following buy on a currency make sure your other strategy buy is not on a correlated one...  8- Trade more assets More uncorrelated assets, if they do not hurt performance = more cashing 🤑🤑🤑! Especially when not much is moving with Forex, just going back and forth, and here you have the S&P 5000 that broke 4000 without hesitation after whales got liquidated and banks had to take the hit, it even gapped up, a bit early to cry victory and stonks time horizons are not the same as Forex ones, but for now it is STRONG and it sure got my attention. Been buying since September/October but been more eager recently. Not a simple snap of fingers and here we go, adding instruments to our activity is a big project, just like a business that sells printers to China starting to produce protection for cellphones for Taïwan or whatever. People think abstract = easy. I'm laughing since it is the opposite. The more intellectual something is, the more difficulty gets ignored, "let's just use a magic wand to make covid disappear" ye good luck with that, what a mentality. Next let's ask devs to code 10 thousand lines a day like it's physical labor and let's ask a scientist picked at random to find the cure for cancer it's easy very little manual labor. There is such a lack of respect for mental activities, it's beyond.  9- Push these winners to the limit S&P again. I've said a while ago I wanted to get really aggressive with the S&P 500 and Bitcoin, I just contained myself 1-2 hours ago to not buy more S&P because I am already ***** deep at that point. This is not the same as being the typical dumb money and greedy pigs that gamble and get wiped out and never are heard form again. If you have this urge to go on the offensive real hard, but within reason as a skilled trader, you can improve your performance. Just don't go all Bill Hwang. Ah if he went aggressive but was 40/40/20 in stocks/forex & cme futures/safe holdings and a bit less concentrated (or in larger cap stuff) he'd be alive now. Humans evolved to "survive against all odds", agility intelligence and social structures helped. "Never give up and survive against all odds" this is not what the markets reward. Markets rewards ambush predators. Get your example from the cheetah, these superfast cats are like bullets. They patiently watch their preys, as we should. Then they run. And 90% or more of the time the prey gets away. The cheetah could easily catch it but is it worth it? NO. A cheetah will not take a diminished risk reward, it will "give up" all the time, "oh noes" says the slow human meatbag, "never give up". Well the cats that survive, that's who. Capitalism 101. The longer they chase, the more calories they spend. Costs go up. Risk also goes up, as they get tired they become more vulnerable AND these seconds they spend chasing they are not paying attention to anything else. So they become less likely to escape or fight off danger, while being much less alert of danger for a long while. The risks are not worth it, and the costs either. Even while being patient and carefully choosing their prey and the moment they go in, 9 out of 10 get away. So they might lose let's say 200 kcalories each time. But now is the good part, once they get one secured, they don't just take a quick bite and run away like all these bagholding profit snatching retail traders. They are destroying that prey. 30,000 calories at once. One big meal. They eat everything. Winrate 5-10% reward/risk 150. Now that's a good trader that extracts all he can from his winners. 10- You can't so learn to be patient RIP. We can always keep improving and doing more and the sky is the limit, but no matter what we do we have to accept that we are going to have to be patient and no one just goes from poor to super rich overnight. It's so hard, but there is no choice. Got to be patient. We are not the FED or the ECB we do not own a money printer.
CME_MINI:ES1!Education
by MrRenev
2
Jalapablo's 10 Golden GuidelinesThese are some of the golden guidelines I live by when I swing trade. They've done me well over the years, they've kept me safe, and they've made me a ton of money. I wanted to share them, especially with new crypto traders just getting started. I had to figure all this stuff out on my own (and it cost me a lot of money). I believe every trader should come up with a set of his/her own personal rules like this and keep it in their trading journal. Wishing safe trading and prosperity to all! NOTE: I am not a financial advisor. Join me and trade my charts at your own risk. *If you have strong hands, patience, and like big wins and big money, follow me. I track all the USD & USDT-paired cryptocurrencies on Coinbase Pro, Kraken, Gemini, Binance, Kucoin, along with many other coins & tokens on various exchanges, and regularly seek out the most profitable swing trades available. All my charts are clean, straightforward, and easy to follow. My TA is based on Wyckoff phase analysis, Elliott wave count & Fibonacci extensions. If some of my sell zones seem conservative, it's only because I believe in exiting while still holding the fat money bags! The more intrepid traders can let the winners run a bit longer. Good luck and safe trading to all! **Unfortunately, I can not give custom entry and exit prices, stop-loss percentages, or offer advice on when and how to take profit other than my own entries and targets which are already on the charts. Thank you for understanding. Trade wins for March 2021 (Total Gains: 527.58%) 1. Filecoin: 31.92% in 14 days 2. Kyber Network: 12.09% in 7 days 3. Loom Network: 66% in 10 days 4. Ravencoin: 78.55% in 11 days 5. NMR: 19% in 2 days 6. Elastos: 178% in 15 days 7. Qtum: 66.84% in 24 days 8. Filecoin: 24% in 5 days 9. AION: 22.83% in 2 days 10. Flamingo: 28.35% in 1 Day Trade wins for April 2021 1. Kyber Network: 35.91% in 10 Days
COINBASE:BTCUSDEducation
by jalapablo
9
Risk Management: Entry in the impulsive phrase of price action Hello everyone: Welcome back to another video on risk management. Today I want to discuss a few possible entries that we can do in the market when we spot the next impulsive phrase of the market condition. I will break down the 3 types of entries that I always look for when I am about to execute a trade. Sometimes we will see all 3 entries present themselves, and sometimes we might only see 1 or 2. So let's dig into these entries. All entries are based on the continuation or reversal structure on the LTF mostly. So I need to see a LTF correction forming and potentially completing before setting any of these entries. In addition, they have to be aligned with the HTF overall direction and bias. Multi-time frame analysis is key. All my entries are stop entry order, meaning the market needs to hit a certain price before getting triggered. Buy Stop or Sell Stop order. You may see variations of these entries in different strategies or styles, but here are my take on them and my way of using them in my trading. Let me give a few examples of each on different markets and pairs to show the potential move and possible entry criteria. Below are same other Risk Management you should know in trading. Risk Management 101 Risk Management: How to set a Take Profit (TP) for your trades Risk Management: How to Enter and set SL and TP for an impulse move in the market Risk Management: How to scale in the impulsive phrase of the market condition? Risk Management: Combine everything you learn to prevent blowing a trading account Impulse VS Correction Continuation and Reversal Correction Multi-time frame analysis
OANDA:XAGUSDEducation
by jojofang0901
24
Forex Trading Secret's - may be 5 min reading Change your life If You Really Want To Know The Secret Of Trading Forex Successfully Then Here It Is : There Are No Secrets There Are Skills Which You Have To Master Jut Like In Any Other Profession . If You Ask Any Professional Trader. He Or She Will Tell You That Forex Trading s A business . To Make a Business Profitable You Need Good Business Plan And a Range Of Skills To Execute The Business Plan HOW TO BECOME A SUCCESSFUL FOREX TRADER ------------ To Become a Successful forex trader is very simple but it is far from easy . first you must choose a trading strategy that works well for you and suits your personality . you must develop a formal trading plan which should include position size , entry , exit , stop loss and profit taking rules , before trading n a live account , practice your strategy according to your plan on a demo account for few weeks once you are comfortable with the strategy , trade according and repeat it over and over again , the key word here is discipline, you have to become a disciplined forex trader to trade and profit from the market consistently THINGS TO DO ------------- Always trade with the trend always calculate your risk reward ratio before entering a trade and try to maximize reward trade only when the markets are highly liquid , which is most of the time in the fx market always use a stop loss let your profit run set and keep to a maximum daily loss amount , after which you must stop trading for the day Never Quit , and learn from your mistakes to continually improve THING'S NOT TO DO -------------- Don't trade beyond your risk profile and comfort zone Don't Hesitate yo initiate and exit your positions Don't Over trade ( too many or too large of trade's ) Don't Move your stop loss Don't let your emotions cause you to deviate from your trading plan Don't try to get revenge from the market when in a losing position Don't trade when you are not feeling well or cannot concentrate THE 7 BIGGEST TRADING MISTAKES YOU CAN AVOID ------------------------ Not learning and educating oneself about the forex market ad trading Not Having adequate capital to begin trading Not treating forex trading as a business Not trading according to a trading plan or not having a trading plan at all Trying to teach the market a lesson when in a losing position Trying to become rich iin one day or a short period of time Starting to gamble when feeling low or bored
TVC:GOLDEducation
by GentleGoldenEngine
5
Trading Plan that will help you become consistently profitableIn my trading career beyond having a strategy (actually multiple depending on market state and asset class) to base my trades on nothing has ever been as important as having a Trading plan. In this post I want to share with you my personal trading plan to help you create a set of rules that will help you stick to your plan and keep your emotions in check so that you can actually follow your trading strategy and become a consistently profitable trader. Something that was and still is key for me is the following realization: Never get attached to your opinion or view of why something should happen. The market is in fact always right and based on nothing but irrationality since its made by humans so the movements of the market do not have to make sense and at more times then not will not make sense. Trading is simply a mind game. Markets are a result of mass psychology which leads to exploitable edges. Mastering your own psychology is key to keep following the strategy that defines your edge. So now without further ado my trading plan template that has helped me so much over the years and I hope will help you as well: **General Rules** 1. Never enter a trade without a plan (TP,SL) 2. Once you are in a trade stick to the plan 3. Its ok to be wrong its not about being right its about making money 4. Be patient do not act on FOMO 5. Do not chase the market 6. Let your winners run and cut your losses short **The 5 fundamental truths** 1. Anything can happen. 2. You don't need to know what is going to happen next in order to make money. 3. There is a random distribution between wins and losses for any given set of variables that define an edge. 4. An edge is nothing more than an indication of a higher probability of one thing happening over another. 5. Every moment in the market is unique. **Rules of consistency**I AM A CONSISTENT WINNER BECAUSE: 1. I objectively identify my edges. 2. I have predefined risk of every trade. 3. I completely accept risk or I am willing to let go of the trade. 4. I act on my edges without reservation or hesitation. 5. I pay myself as the market makes money available to me. 6. I continually monitor my susceptibility for making errors. 7. I understand the absolute necessity of these principles of consistent success and, therefore, I never violate them. **Risk and Money Management** Do not increase the standard trade size before you doubled the account. 1. The maximum amount you are allowed to lose in a day is $XXX.  2. The maximum amount you are allowed to lose on any single trade is $XXX.  3. The maximum number of losing trades in a row you are allowed to have in a day before you stop trading is three.  4. The maximum number of losing trades you are allowed to have in a day before you stop trading is five. (You may have had a win or two between losses, but there is a time to stop trading.) The maximum number of losing trades in the same direction you are allowed to take in a day before you stop trading is three.  1. If you are up $XXX on a single trade, you will put a profit floor of $XXX underneath the current price to protect a portion of those profits.  2. If you are up $XXX on a single trade, you will take the money and close out the trade.  3. If you are up $XXX for the day, you will take the rest of the day off, stay away from the trading screens, and do something you enjoy doing—other than trading !4. If you are up $XXX for the month, you will put a profit floor of $XXX underneath the month's profits to protect a portion of those profits. If you are up $XXX for the month, you will take the rest of the month off, stay away from the trading screens, and do something you enjoy doing—other than trading! Take a vacation, sleep late and read books, or do something else fun.
Education
by TradingPit
3