6 Top Trading Time WastersYou need to stop wasting precious time.
I have had members who’ve been with me for 15 years and haven’t even taken a trade.
I have written this article in a way that you can relate to the problems with traders wasting time.
Ready?
#1. Wait for Inspiration
Trader A: “I just can’t trade today. I’m waiting for that magical moment when inspiration strikes!”
SOLUTION:
Waiting for inspiration in trading is like waiting for money to rock up at your doorstop.
It doesn’t happen!
Successful traders create their own inspiration, discipline and integration by TAKING ACTION.
You want a sign.
Here’s a sign.
Start today, do not delay and don’t wait for another sign.
#2. Complaining
Trader A: “The market is so unpredictable and complicated! I can’t catch a break.”
SOLUTION: Stop complaining and start acting, adapting, growing and evolving.
Markets change, that’s the only constant about it.
And they move up, down and sideways.
So, instead of moaning about it, embrace the volatility.
Complaining won’t make you a better trader, but adapting to change will.
#3. Doubting
Trader A: “I’m not sure if I can make this trade. It’s going to be a loser.”
SOLUTION: Doubt is the enemy of success.
Trust your analysis, track record and your stats.
Stick to your strategy just keep at it.
This is a long term game to success.
When you doubt yourself, you manifest a deeper element of self-failure.
You need to stop wasting precious time and opportunities.
Confidence, certainty and trust is key!
#4. Comparing
Trader A: “Look at their profits! I wish I could trade like them.”
SOLUTION: Comparison is the thief of joy and the delayer of self success.
You should only focus on your own journey.
You are running your own marathon.
It doesn’t matter how much money you have.
It doesn’t matter how long you’ve been trading.,
It doesn’t matter if others are doing better.
You need to focus on your trading time line.
#5. Excuse Giving
Trader A: “I didn’t trade well because the market was too volatile.”
SOLUTION: Excuses won’t make you a better trader.
I don’t have enough time.
I don’t have enough money.
I don’t have enough experience
I don’t have enough patience.
I don’t have enough anything.
I repeat – Excuses won’t make you a better trader.
Take responsibility and take accountability for your decisions, good or bad.
Learn from your mistakes and use them to refine your trading strategy, stats and track record.
Excuses only waste time; accountability fuels improvement.
#6. Fear of Failure
Trader A: “What if I lose all my money? I can’t handle the risk.”
SOLUTION: As I always like to say.
You ONLY fail when you quit.
Fear is natural, but letting it control your actions is a mistake.
You need to manage your trading and risks better.
You need stay laser focused with tunnel vision.
With trading you should not AVOID losses – as they are inevitable.
You should embrace both winners and losses to come with the trading venture.
You can’t win them all. But you also can’t lose them all.
Keep that in mind when you trade.
FINAL WORDS
So, by now you should have one thing in your mind.
Stop wasting time with your trading.
Every day you delay is another profit opportunity you’re letting go of.
Let’s sum up the 6 Time Wasters with trading.
#1. Wait for Inspiration
#2. Complaining
#3. Doubting
#4. Comparing
#5. Excuse Giving
#6. Fear of Failure
Tradingstrategy
Leveraging Pivot Points for Intraday Trading StrategiesIntroduction to Pivot Points:
A pivot point serves as a pivotal indicator in technical analysis, aiding in discerning market trends across various time frames. Essentially, it's an average of the intraday high, low, and closing prices from the previous trading day.
Traders interpret trading above the pivot point as indicative of bullish sentiment and below as bearish.
Key Features:
Pivot points form the foundation of this indicator, from which support and resistance levels
are projected. These levels offer insights into potential price reversals or continuations. It's widely utilized in equities, commodities, and forex markets to identify trend shifts and
reversals.
Traders leverage pivot points to determine entry and exit levels, aiding in strategic decision-
making for intraday trades.
Formulas for Calculation:
The formulas for pivot points involve simple calculations based on the previous day's high, low, and close prices. These calculations yield pivotal support and resistance levels crucial for trade planning.
The Formulas for Pivot Points:
P= High+Low+Close / 3
R1=(P×2)−Low
R2=P+(High−Low)
S1=(P×2)−High
S2=P−(High−Low)
where:
P=Pivot point
R1=Resistance 1
R2=Resistance 2
S1=Support 1
S2=Support 2
Calculation Method:
Pivot points can be manually calculated using the prior day's data, which includes the high, low, and close prices. These levels are essential for traders, especially for intraday strategies.
High indicates the highest price from the prior trading day,
Low indicates the lowest price from the prior trading day, and
Close indicates the closing price from the prior trading day.
Interpreting Pivot Points:
Pivot points provide traders with static support and resistance levels throughout the trading
day. This enables traders to pre-plan their trades based on potential price movements.
Traders utilize pivot points in conjunction with other indicators to enhance their trading
strategies, aiming for more accurate predictions and better risk management.
Comparison with Fibonacci Retracements:
Pivot points and Fibonacci retracements share the common goal of identifying support and
resistance levels. However, pivot points rely on fixed numbers derived from the previous
day's prices, while Fibonacci retracements are based on percentage levels drawn between
significant price points.
Limitations and Considerations:
While pivot points offer valuable insights, they are not foolproof indicators and may not work
for all traders. It's crucial to integrate them within a comprehensive trading plan and
acknowledge their limitations.
Price movements may not always adhere strictly to pivot point levels, requiring traders to
exercise caution and employ additional analysis techniques.
Conclusion:
Pivot points remain a fundamental tool in the arsenal of intraday traders, aiding in trend identification and trade planning. By understanding their calculations, interpreting their implications, and integrating them with other indicators, traders can harness the power of pivot points to make informed trading decisions.
Disclaimer: This trading idea is for educational purposes only and should not be considered as financial advice. Traders are encouraged to conduct thorough research and exercise caution when implementing any trading strategies.
I'm done with this!We’ve all had this moment.
Where we stare at our screens, scratching our heads, wondering a bunch of stuff.
Why is this so slow?
Why can’t I press the button
Where am I going wrong?
We’ve chased trends, hesitated when we should have acted, and let our emotions play puppeteer with our portfolios.
Today is the turning point.
For you!
It’s time to say…
“I’m done!”
This read could be what you need to win this year.
#1: I’M DONE: Making Excuses
Enough is enough!
No excuses this time.
Open your trading account
Deposit more money
Adopt strong trading strategies
Have the right calculators and journals to follow
Keep at it.
No more blaming external factors; it’s time to own your trading career and learn from them.
#2: I’M DONE: Feeling Emotional
Trading with emotions is like juggling dynamite.
Sooner or later, something’s going to explode.
Whether you have been on this rollercoaster of euphoria and despair for far too long.
If you celebrate winners or get angry over losers – The emotions will only enhance and will develop into emotional turmoil.
It’s time you take a more rational approach.
Risk less – If the amount is too emotional to handle.
No more “I know better trades” than my trading strategy.
No more fear, greed and definitely NO MORE EGO!
It’s time to trade with a clear head and a steady hand.
#3: I’M DONE: Rushing the Process
Patience is not just a virtue; it’s a survival skill.
Have you been guilty rushing into trades without proper research, hoping for quick wins.
Have you been irritated how slow the progress is to build an account.
Have you felt the need to quit during drawdowns.
Guess what?
No body fails with trading.
They quit.
The market doesn’t care about your impatience.
From now on, adopt the mantra:
“Slow and steady wins the trading race.”
#4: I’M DONE: Doubting Myself
Self-doubt is the silent assassin of trading success.
It creeps into your mind, sows seeds of uncertainty.
Before you know it, you’re second-guessing every move.
Stop!
Remember, you are the BOSS of your trading account, strategy and results.
So act like a boss.
Get rid of self-doubt and embrace more confidence.
You have got the skills, the knowledge, and the experience.
It’s time to trust yourself and let your trades reflect that trust.
#5: I’M DONE: Missing Great Opportunities
Regret is a bitter pill to swallow.
Especially when it comes to missed trading opportunities.
I’m sure you’ve kicked yourself one too many times for hesitating when you should have pounced.
I still kick myself when I miss trades!
We are human. We can’t see everything all the time.
But remember this.
The next trade is always on its way.
You don’t need to feel FOMO (Fear of Missing Out).
Always try improve on spotting and taking advantage of better trading opportunities.
And know that taking trades (no matter how good they look) are always difficult.
But they need to be taken.
They need to be followed.
From now on, be bold, seize the moment, and make the most of every chance the market throws your way.
FINAL WORDS:
It’s all on you!
Every financial decision you make, is your responsibility.
So remember to say out loud what we are DONE THIS YEAR.
#1: I’M DONE: Making Excuses
#2: I’M DONE: Feeling Emotional
#3: I’M DONE: Rushing the Process
#4: I’M DONE: Doubting Myself
#5: I’M DONE: Missing Great Opportunities
What Makes a Trade – Unveil the pillars of profitable tradingTo trade well is nothing more than a calculated dance on the trading floor.
You need to navigate the volatile seas of markets and understand the essential elements of a trade.
And whether you’re a newbie or the MOST experienced trader out there, you need to adopt the same quintessential factors with your trading.
And that is, the elements that make a trade.
Let’s get into them…
Position Size
Imagine building a mansion without a blueprint.
That’s what trading without considering position size feels like—chaotic and prone to collapse.
The cornerstone of any robust trading strategy is for you to figure out the right amount of exposure to each position.
It’s not just about the quantity of trades but the quality of each.
You need to be precise in the position sizing with each trade.
That is to maintain your risk and money management.
That is to make sure you will only deposit a certain amount into your trade.
And it is to ensure you have enough money to take on new and even higher probabilities of trades.
Precision in position sizing is the silent architect behind the towering fortresses of successful traders.
Entry: The art of timing of execution
Whenever you enter into a market, 98% of the work is done.
You have everything lined up according to the criteria, strategy and plan.
You already have your idea on whether a market is likely to rally on up or fall off its horse.
It’s not just about being in the market; it’s about being in the market at the right moment.
Risk Level: Taming the market beast
In the wilderness of financial markets, risk is the untamed beast that can either devour or be tamed.
You need to be able to recognize the risk levels you’ll set to contain the beast.
Where to place your stop loss
The calculations of where you are NOT most likely to be hit
Your risk per level and what you can stand to lose.
Your risk level is your shield to protect from unexpected peril.
You have to have all your calculations to lose a battle but NOT the war.
Reward Level: Harvest your fruits
Yes a MAJOR element to trading is RISK.
But it’s also about reward, or else why would we be doing it?
You need to meticulously set realistic reward levels that mirror the potential gains of a successful trade.
Your reward must ALWAYS be more than your risk.
You need to see the potential and likely future for the price to hit the take profit.
Profit and Time Protection Levels: Safe-guard your winners and cut your losses
Trading unfortunately is NOT always 100% mechanical.
You need to safeguard your positions at times.
What if the position becomes a non performing investment?’
And you’re losing daily interest?
Well you need some type of time stop loss.
This will get you out of your trade at a certain period so you can look for better positions.
Worst case scenario you lose less than expected. Or you even bank a bit of profits as the trade remains in the money.
FINAL WORDS:
Trading is a game of calculated strategy and skill.
But there are pillars of trading, you can’t avoid including:
Position size, entry
Risk level
Reward level and
Profit and time protection levels.
These will help you form the bedrock upon which the palaces of prosperous trading are built.
As you embark on your own trading odyssey, remember: mastery of these elements is not just a choice; it’s the key that unlocks the doors to financial triumph.
So make sure you have these elements ready to execute to make a trade happen.
How to trade the Fibonacci indicator in 2024Today, we’ll start with what Fibonacci is and how to use it to spot significant market turning points.
Let’s start with...
A short story about Fibonacci
In 13th century Italy, lived a man named Leonardo Pisano – one of the greatest mathematicians of all time.
Leonardo (also known as Fibonacci), learnt all about Arabic and Indian mathematics during his travels in North Africa and around the Mediterranean regions.
Each time he travelled to a new place, he kept noticing a consistent pattern that repeated itself throughout nature.
The sequence he defined was as follows.
0, 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144…
Basically, all you do is take the last two numbers and add them up to get the next number.
0 + 1 = 1
1 + 1 = 2
1 + 2 = 3
2 + 3 = 5
3 + 5 = 8
8 + 5 = 13
And so on…
Fibonacci first contrived this pattern through a pair of breeding rabbits but he then saw this pattern throughout nature - in the breeding of honeybees , the shape of seashells as well as plants.
This sequence also applies to trading and investing charts and is called the Fibonacci Retracement indicator.
The Fibonacci Retracement indicator is used to help identify possible support and resistance levels for any market.
The idea is all high liquid markets tend to move, to and retrace back, to certain levels after a big price move.
The indicator is used to calculate the ratios and percentages using the Fibonacci sequence.
Let’s look at an example with the South African JSE ALSI 40.
Fibonacci on the JSE ALSI 40
Looking at the above daily chart of the JSE ALSI 40, you can see the index has fallen from a Swing High point of (100%) at 70,522 down to a Swing Low point (0%) to 65,386.
On your platform, when you add the Fibonacci Retracement tool onto your chart, you'll drag it from the swing high to the swing low price of the uptrend to see six main horizontal fib lines present themselves:
Fib line #1: 100% (Swing high)
Fib line #2: 61.8%
Fib line #3: 50%
Fib line #4: 38.2%
Fib line #5: 23.6%
Fib line #6: 0% (Swing low)
Traders use these lines to establish and identify supports (floor) and resistances (ceiling) levels.
And with these levels you’ll be able to spot good entry, stop loss and take profit price levels.
Once you draw the Swing High and Swing Low on the JSE ALSI 40, the Fibonacci lines will be plotted on the chart.
You would also have seen the market then went to one of the high points at 61.80% at 68,560.
The price then retraced back to the 23.6% level at 66,598.
So you can see where we are going with this.
As a reversal trader, you could have sold (gone short) the index around 68,560 and held it until it hit the 66,598 line at 23/6%.
That’s where you would have banked a gain just by waiting for the market to bounce off a fib line.
That’s a good introduction and a different way for you to trade and use the Fibonacci Retracement tool with your trading in 2024.
Let me know if this was helpful!
7 Monopoly Lessons for TradersYou can learn a lot from the classic board game we all know and love: Monopoly.
And as a trader, if you decide to play it again with your spouse or children – you’ll find the game to be very different.
That’s because you have a better sense of risk, reward, probabilities and money management.
You have the patience to grow a sizeable portfolio and eventually WIN!
But before you do delve into your past, I want to share 7 important lessons I learned about trading from Monopoly.
Hold Cash: The higher earner has the upper hand
In Monopoly, the richer always has a stack of cash at the ready.
Just like the Casino (where the house holds most of the money).
And where the money is, is where the advantage lies.
Similarly, in the trading arena, the money you have on hand is your golden ticket to seize profit opportunities.
You know when they say, we are still counting our money?
It’s because you have cash in hand rather than tied up in different assets.
So with trading and with Monopoly, cash is king.
You always need money to:
Have funds to buy or sell more markets
Be able to control your risk and money management
Work on your Drawdown control methods
Peace of mind you’re in it for the long haul
No matter how many trades or positions I take, I always make sure to have at least 90% of cash in the portfolio at any one time.
Be Patient: Not every roll is a winner
Impatience is the enemy of traders.
In Monopoly, you don’t win by making reckless moves at every turn.
It’s about waiting for the right moment to strike.
It’s about being patient to wait for the right property to buy and take advantage of.
It’s about waiting for your opponent to land on your property for you to get paid.
All in good time my friend.,
Apply the same philosophy to trading.
The market will throw its share of doubles and snake eyes your way, but success lies in patience and strategic precision.
You need to be patient for:
The high probability trade to line up
The markets to play out
The drawdowns to end eventually
Your portfolio to grow at a slow but steady rate
Patience is EVERYTHING.
Monopoly teaches us the value of holding onto our hard-earned cash. Similarly, in trading, preserving your capital is the name of the game.
Avoid risky moves that could bankrupt your portfolio, and remember, sometimes the best move is not the flashiest one.
Don’t blow on the most expensive stuff
Just because Boardwalk has an expensive hotel doesn’t mean it’s the winning move.
Similarly, the most expensive stocks or markets like Brent Crude or Indices like JSE ALSI 40 aren’t always the path to success.
First, you might not have enough funds to accommodate the positions.
Second, the markets might not have aligned perfectly to your strategy.
Third, a high price market might be in a BUBBLE which is ready to pop.
Fourth, it might be stressful putting in a large margin of funds to hold a more expensive stock i.e. Facebook, Berkshire Hathaway, Apple etc…
Astute traders know that value can be found in unexpected places.
You might find even better profit opportunities in other Blue Chip stocks that don’t even cost 1/10th of the price.
Diversification and Opportunism: Building houses on every colour
Monopoly teaches us the power of diversification.
There are different properties with a variety of prices and conditions.
You need to learn how to spread your investments wisely, and be opportunistic.
Just as building houses on every color can secure your Monopoly victory, diversifying your portfolio across sectors, markets and positions can mitigate your risk and boost your chances of success.
Strategic planning trumps luck
I have to admit that, luck does play a role in both Monopoly and trading.
It is luck to not roll the dice and land on “Go to Jail”.
It is luck to not pick up a Chance card saying “You have to pay rates and taxes”.
Same with trading.
It is luck getting into a high probability trade and then the market actually playing out.
It is luck being in a strong and favourable market environment for your trading system.
It is luck having the market price shoot up past your take profit due to some external event.
But trading and Monopoly are both very much strategic planning processes.
You need to plan your moves carefully.
You need to act on your moves, based on probabilities.
You need to risk accordingly to not go bankrupt.
You need a strong and well-thought-out trading plans.
Conduct thorough analyses, and stick to disciplined strategies.
And this is how strategy and luck will help you increase the chance of success.
Negotiation mastery
Monopoly is not just about rolling the dice; it’s about negotiation.
You are playing against opponents of different advantages and styles.
You need to learn how to negotiate, aid and help each other – before you beat them!
I don’t know how else to explain this :D.
Trading also involves striking deals.
You’re hitting bids (when selling) and offers (when buying).
You’re betting against your counterparty (investor, trader or market maker).
You’re negotiating prices and moves.
The choices you make will give you the significant edge and help streamline your profitable journey.
Passive Income Key: Collect $200 as You Pass Go
The exciting and genius of Monopoly lies in the sweet reward of $200 every time you pass Go.
You know that feeling of waiting and playing your turns. Going through the good Chance cards and the Bad (going to jail).
But when you are out and you pass Go, you can to collect your wage of $200.
This is your special passive income secret weapon.
You don’t just stick to what you have, you build on it and use what you newly have to grow your portfolio.
The same works with trading.
Each month, you receive a salary. And you spend, save and invest.
So if you want to grow your trading portfolio using the compounding strategy, you might as well build on it.
You might as well accelerate your trading journey.
You might as well let your money work for you!
Embrace the power of compounding, re-investing and depositing, and you might find yourself collecting much more than $200 as you navigate the trading board.
Let’s sum up the Monopoly Lessons Traders Can learn:
Hold Cash: The higher earner has the upper hand
Be Patient: Not every roll is a winner
Don’t blow on the most expensive stuff
Diversification and Opportunism: Building houses on every colour
Strategic planning trumps luck
Negotiation mastery
Passive Income Key: Collect $200 as You Pass Go
FINAL WORDS:
The trading board is yours – now go bankrupt the market, one strategic move at a time!
KOG - Simple Trading Strategy Simple Trading Strategy - Generate your own take profit targets.
Today we're going to share with you a simple yet effective trading strategy that can be used on any instrument. Like any other trading strategy its not 100%, but, you can see from that illustration how effective it can be in keeping you in the right direction on a pair. You can add Moving averages to this as well as which ever indicators you prefer to use and fine tune the strategy to make it work for you. We must stress, with this strategy you have to have a confident ability in charting and have an understanding of support and resistance levels as well as key zones and regions of liquidity.
The bonus with the strategy is it can be applied to all time frames, it can be used to swing trade on longer time frames and to scalp on short time frames. So when we publish our daily morning reviews with our levels and say "LEVEL TO LEVEL" trading, this strategy gives you an idea of what we're suggesting. Also, when we share our 15M levels and zones you can apply this strategy to trade your way up or down to the target.
So lets begin:
1) Start with the 4H chart
2) Look for price action where the price was previously in the same range
3) Use the highs and the lows of swings to plot your support and resistance lines
4) Switch to the 1hr chart
5) You are looking for candle body closes above or below the support or resistance lines. The bigger the candle body close the more accurate the target above is.
We can use this strategy to take numerous trades in up and down until the target level is reached.
This strategy also helps you with your entries and exits. Once you plot the lines and see the price is in between two lines of support and resistance, you will know not to enter a trade. Wait for the pull back on the smaller timeframe or for your chosen indicator to give you the signal!!
NOTE:
• Lines can never be accurate but try to get them as precise as possible
• You must update your lines daily as support and resistance levels change
• You must have a risk strategy in place. On most occasions there will be a pullback or retracement on price which can put you in drawdown.
• Money and risk management are priority when using this strategy.
• Nothing is 100% but once you add the Excalibur target to the chart you have clearer idea of direction.
ALWAYS REMEMBER:
MAs and indicators are lagging, when using this strategy try to keep it simple and clean. Basic support and resistance levels along with a decent candle body close.
Try it, backtest it, apply it. Let us know your findings.
As always, trade safe.
KOG
5 Important Trading Protection LevelsREMEMBER
No matter what stock, index, Forex or other markets you’re trading, every trader needs 5 protection levels.
Stop loss to stop yourself from furthering losses
Time stop loss to get you out of non-performing trades
Adjusted stop loss to lock in profits when the market moves in your favour.
Risk % per trade to only lose a certain amount of your portfolio
% of Drawdown before you HALT trading – when the market is not in a favourable environment to your strategy.
Short and sweet but VERY powerful to apply to your trading.
Do you have any other protection levels?
Are we in LAZY FEBRUARY traders? Q. "I heard that there is a phenomena called “Lazy February”. Could you explain why it’s called that and what I should watch out for as a trader?”
A. I have not heard that term in eons! Here’s my 10 cents on how Lazy February got this name.
Short month effect
February is the shortest month of the year.
And because so much happens in February, many investors like to play it safe and observe.
Most investors tend to wait for March when the markets have chosen a direction, earnings are out, taxes are paid and they are ready to invest again.
Year-end position squaring
Traders often close out their positions at the end of the year right through to January.
And this is for accounting, performance evaluation and tax purposes.
This process is known as "position squaring”.
But the big influencer is tax.
Closing off the tax year
In many countries, February is a time when individuals and corporations start preparing for tax filings.
And this can influence investment decisions which can lead to either selling their positions or adjusting their portfolios for tax efficiency.
After February and going into March, we should see a higher volume of buying and investing in the markets.
Earnings season
February is also known for major earnings releases – Especially in the U.S.
Investors during this period prefer to watch and observe. This way they’ll be able to see the forecasts versus the actual results.
Once the numbers are released, that’s where they’ll have more of an idea of what they want to invest in and what to buy or sell in March and the coming year.
Q. WILL A 125BPS CUT IN INTEREST RATES DRIVE UP GOLD?
A. Remember when it comes to interest rate cuts it means the following:
Stimulates economic growth
This makes borrowing cheaper as interest rates are lower.
And it encourages more spending and investments by individuals and businesses.
Boosts buying from consumers
Also, with low interest rates it entices people to buy more.
And this is because the cost of loans drops.
This leads to them buying more homes, cars, and other goods.
There are other elements, but you get the idea.
Now, lets consider why lower interest rates could mean the gold price will rally
Reason #1: Lower interest rates and a weaker US dollar helps the gold price
When interest rates drop, the yield on bonds and savings accounts typically declines.
And a weaker dollar makes gold cheaper for people with other currencies.
It's like gold goes on a global sale, and everyone wants a piece!
So, this will drive up its demand and the price.
Reason #2: Investors get out of low yielding markets and into gold
Remember that when interest rates are high, investors move to high yielding markets.
They like to keep their money in the banks, bonds, money market or any other high interest savings accounts.
But when interest rates drop, investors don’t make much of their money from these assets.
And so, they will look to invest in markets like gold, which will drive the price up.
Reason #3: The golden safe-haven will prevail!
With interest rate cuts, it normally signals signs of economic uncertainty or weakness.
And during these times, investors will often seek out safe-haven assets.
Gold is a classic example of a safe haven that investors will look to buy.
And this golden attraction will help push the price up.
EXPLAINED: Odd Lot Offer EasilyWHAT IS AN ODD LOT OFFER?
An odd-lot offer is a financial transaction.
It is where a company offers to buy back small quantities of its shares from shareholders who hold fewer shares than the typical trading unit.
Usually it’s under 100 shares.
In the context of stock markets, an “odd lot” refers to a number of shares that is less than the standard trading lot.
Here are the key points about an odd-lot offer:
Target Audience:
Aimed at shareholders who own fewer shares than the standard trading unit (commonly 100 shares).
Purpose:
Typically initiated by a company to reduce the number of small shareholders and simplify its shareholder structure.
Offer Terms:
The company specifies an offer price at which it is willing to buy back the odd lots of shares. This price may be at a premium to the current market price.
Voluntary Participation:
Shareholders are not obligated to participate; it’s a voluntary decision on their part.
Cost Reduction:
Companies may implement odd-lot offers to reduce administrative costs associated with managing a large number of small shareholders.
Shareholder Choice:
Odd-lot shareholders can decide whether to sell their shares to the company at the offered price or to retain their shares.
Tax Implications:
Companies may structure odd-lot offers in a way that has specific tax implications for shareholders. It’s common for the offer to be treated as a return of capital rather than a dividend.
Approval Process:
In many cases, such offers require approval from the company’s shareholders, often obtained at a general meeting.
Let’s use an example with City Lodge in 2023.
1. What’s Going On:
As of October 16, 2023, there were a bunch of small-scale shareholders in City Lodge, each holding fewer than 100 shares.
These investrs are referred to as “Odd-lot Holders,” which make up 58.22% of all City Lodge shareholders.
However, when you look at the total shares they own, it’s just a tiny 0.06% of the market.
Now, managing these tiny portions costs a lot, creating a headache for everyone.
2. The solution
To solve this issue, at City Lodge’s board of directors are suggesting an Odd-lot Offer.
This means they want to buy back the small amounts of shares from these Odd-lot Holders, making life simpler for everyone involved.
3. So what do these Odd-lot holders get?
If you’re one of these Odd-lot Holders, you get a chance to cash at a price that’s 5% more than the average value of City Lodge shares over the past 30 days.
It’s like a special deal, and you won’t have to pay any fees to make the transaction.
4. How it works
To make this happen, City Lodge needs approval from its shareholders.
They discussed it at the Annual General Meeting on November 23, 2023.
If the plan gets a green light, Odd-lot Holders can decide to sell their shares at the offered price or keep them.
5. The tax story
They considered the Odd-lot Offer isn’t a dividend but more like a return of capital.
This decision has some tax implications, so they suggest you chat with your tax expert for the details.
City Lodge wants to simplify its shareholder list, and if you’re an Odd-lot Holder, you have a choice to make – take the deal or keep riding the City Lodge wave.
Does that help and did it help you?
Examples of how to draw and use trend linesHello traders!
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(1W chart)
Usually, the way to draw a trend line is to connect the high point and the high point where the trend changes, or to connect the low point and the low point to display the trend line.
Then, a channel is formed to express movement within that channel.
It is a relatively simple analysis tool that anyone with a good understanding of charts can draw trend lines.
However, I think whether you can use it in actual trading depends on how much you trust the trend line.
However, due to the nature of the trend line, it is expressed as a diagonal line, so it has a fundamental problem that it is not easy to respond even if it deviates from the trend line.
So, in order to trade with information obtained from chart analysis, you must draw support and resistance points close to the horizontal line.
Therefore, in chart analysis, you must have a basic understanding of the candle arrangement.
In my chart, the StochRSI indicator is
1. Use the waves of the StochRSI indicator to check support and resistance at support and resistance points.
2. Used to draw trend lines.
When drawing a trend line with the StochRSI indicator, the oversold section is below 20, the overbought section is above 80, and the trend line is drawn by connecting the points where the vertices are created.
However, the trend line drawn between high points is drawn based on the opening price of the falling candle.
Therefore, draw a trend line by selecting the peak of the StochRSI indicator or the opening price of the nearest bearish candle.
You can draw a trend line by connecting the low points of candles corresponding to the vertices of the trend line, which is drawn by connecting the low points.
For detailed instructions, please refer to the trend line displayed on the chart.
Among the trend lines drawn on the chart, I think that the trend line drawn almost horizontally is actually important.
Otherwise, I think it is a trend line drawn for chart analysis because it is difficult to use diagonal trend lines for trading.
In order to utilize a trend line expressed as a diagonal line, support and resistance points must be displayed together to be considered a trend line that can be used for trading.
When using various chart tools that are used by specifying a selection point, how the selection point is specified is very important.
Therefore, if the criteria are not clear when specifying the selection point, what is drawn using various chart tools cannot be trusted.
To solve this problem to some extent, we used the StochRSI indicator to draw a trend line.
(1D chart)
If you look at the trend lines drawn on the 1D chart, you can see that the two trend lines at the current price position are drawn close to the horizon.
Therefore, the key is whether the price can be maintained by breaking above the trend line of 1.
If this is not the case and it falls below trend line 2, it can be seen that there is a high possibility that it will lead to a further decline.
In that sense, the key is whether it can rise above the HA-High indicator, that is, above 43K.
If it falls, it is likely to touch the HA-Low indicator, so it is important to check for support near the HA-Low indicator when it is generated.
When drawing a trend line using the StochRSI indicator, vertices formed outside of oversold or overbought areas are excluded.
The reason is that the upward or downward intensity is weak.
This is to prevent confusion because if the rising or falling strength is weak, it is likely to be a fake or whipsaw.
It is important to draw in a way that has a solid basis so that you can trust the tools you draw on the chart.
StochRSI settings : 14, 7, 3, 3 (RSI, Stoch, K, D)
Have a good time.
thank you
--------------------------------------------------
- The big picture
The full-fledged upward trend is expected to begin when the price rises above 29K.
This is the section expected to be touched in the next bull market, 81K-95K.
#BTCUSD 12M
1st: 44234.54
2nd: 61383.23
3rd: 89126.41
101875.70-106275.10 (when overshooting)
4th: 13401.28
151166.97-157451.83 (when overshooting)
5th: 178910.15
These are points that are likely to encounter resistance in the future.
We need to see if we can break through these points upward.
Since it is thought that a new trend can be created in the overshooting zone, you should check the movement when this zone is touched.
If the general upward trend continues until 2025, it is expected to rise to around 57014.33 and then create a pull back pattern.
1st: 43833.05
2nd: 32992.55
-------------------------------------------------- -------------------------------------------
** All explanations are for reference only and do not guarantee profit or loss in investment.
** Trading volume is displayed as a candle body based on 10EMA.
How to display (in order from darkest to darkest)
More than 3 times the trading volume of 10EMA > 2.5 times > 2.0 times > 1.25 times > Trading volume below 10EMA
** Even if you know other people’s know-how, it takes a considerable amount of time to make it your own.
** This chart was created using my know-how.
---------------------------------
Traders Don’t Fail – They QuitIt’s been a very tough year for swing traders.
Go long the market drops. Go short the market rallies.
Don’t do anything and you save from the burn.
But in the bigger scheme of things, it looks like we are in an accumulation phase.
The accumulation phase is a period in which smart money (informed and experienced traders or institutional investors) is believed to be accumulating a particular asset while it is still relatively undervalued.
This phase occurs before a notable uptrend or bullish move in the market.
Key characteristics of the accumulation phase include:
Sideways Movement:
Prices move within a trading range, often forming a base or a consolidation pattern.
The range represents a period of equilibrium between buying and selling forces.
You can see the JSE ALSI has been in a tight range this entire year.
Decreasing Volume:
Volume tends to decline during the accumulation phase, indicating a decrease in overall market activity.
Lower volume signals that the asset is not attracting significant attention from the broader market.
There have not been huge orders on the JSE ALSI like other years. It could be because there are LESS investors buying shares and more going into derivatives and margin trading.
Or because they are worried about the state of the economy with load shedding, foreign direct investments pulling out, the country being rated down or people fleeing the country.
Smart Money Accumulation:
Informed traders or institutional investors quietly accumulate the asset during this phase.
Their accumulation is not typically evident in the overall market activity due to the relatively low volume.
Now with December, we could see investors piling into trades from their bonuses, offsetting taxes, preparing for the next year or with optimism with the festive season.
Transition to Markup Phase:
After a sufficient accumulation, there is an expectation that the asset’s price will break out of the trading range.
This breakout marks the end of the accumulation phase and the beginning of the markup phase, characterized by a sustained uptrend.
So, my hopes and bets are UP.
I think once we break out above the range, we could see the JSE ALSI rally a good 10 -20%.
But geez, we need strong catalysts to kick in.
Even if it’s international markets helping us run up with Dual LIsted companies or America’s leading influence.
What are your thoughts? You think we’ll get our long waited for rally?
Traders and investors who stay in the game will reap the rewards.
Patience is a trader's virtue.
Impatience is the reason why traders quit. They don’t FAIL – THEY QUIT.
Forex Fundamentals: Building Winning StrategiesForex trading success hinges on a well-defined strategy, as it sets a clear direction and methodology, whether it be scalping, day trading, or another approach. Key to this is understanding the market conditions under which your strategy thrives, as different strategies perform variably across market environments. Employing technical indicators is crucial in providing insights and aiding in decision-making, but they must align with your overall strategy for coherence and effectiveness.
The core of any trading strategy lies in its entry and exit criteria. These criteria ensure disciplined and non-impulsive trading decisions, allowing for entry and exit from the market at the most opportune times. Equally vital is stringent risk management, which protects your capital by defining the risk per trade and setting maximum drawdown limits. In tandem with this, appropriate position sizing mitigates the risk of substantial losses and maintains the health of your trading account.
Backtesting the strategy against historical data is indispensable for understanding its potential effectiveness and challenges. This, followed by forward testing in real-time conditions, often in a demo environment, allows for fine-tuning and adaptation to current market dynamics. Constant adjustments and optimization of your strategy are necessary as financial markets are ever-evolving, and a static strategy is often a recipe for failure.
However, the strategy itself is only part of the equation. The psychological aspect of trading – maintaining discipline and managing emotional responses – is equally critical. Regular performance evaluations and reviews provide insights into the strategy's effectiveness and areas that require improvement, fostering a cycle of continuous learning and adaptation.
In the realm of Forex trading, patience and consistency are not just virtues but necessities. The development, implementation, and refinement of a trading strategy is a meticulous and ongoing process. Success in trading emerges from a disciplined approach, a willingness to learn continuously, and an adaptability to evolving market conditions. It's a journey where each step, from understanding market conditions to psychological resilience, plays a pivotal role in shaping a trader's path to achievement.
Introduction to one of the basic trading methodsHello traders!
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Please also click “Boost”.
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-------------------------------------
Basic trading method
(How to purchase)
1. Aggressive buying when falling by more than -10%
2-1. Buy when there is an upward trend on the 1D chart (when the price is maintained above the MS-Signal indicator) and when the candle is a downward candle.
2-2. Buy when there is a downward trend on the 1D chart (when the price is maintained below the MS-Signal indicator) and when the candle breaks upward through important support and resistance points.
Therefore, buy when there is a rising candle.
(Selling method)
1. Split sale when it rises by more than +10%
2. Split selling when the high point cannot be renewed
-------------------------------------------------
The basic trading methods introduced above are methods that can be traded even if you are not familiar with chart analysis.
Among these, I will take the time to explain the trading method corresponding to 2-2 of the purchasing method.
You can know the trend based on the MS-Signal indicator on the 1D chart.
Currently, it has fallen below the MS-Signal indicator, and the MS-Signal indicator has been converted to a downward indication.
Therefore, it should be interpreted that there is a high possibility that the current downward trend will continue.
Therefore, in the basic trading method, you should buy when the candle is below the MS-Signal indicator on the 1D chart, that is, when it is in a downtrend.
Therefore, you should buy after confirming that the price breaks above the support and resistance points.
Basically, you can trade using HA-High, HA-Low indicators and box sections.
If you purchased when it fell more than -10% on January 12, you can proceed with a second purchase if it rises above the HA-High indicator.
You can proceed with aggressive buying when the HA-High indicator breaks above the 43450.03 point.
In that case, you will have to sell it in installments when it appears to be rising and then falling.
If you don't like it, you should check for support at 43450.03.
In order to confirm support, it is necessary to check for at least 1-3 days after rising above 43450.03.
Have a good time.
thank you
--------------------------------------------------
- The big picture
The full-fledged upward trend is expected to begin when the price rises above 29K.
This is the section expected to be touched in the next bull market, 81K-95K.
#BTCUSD 12M
1st: 44234.54
2nd: 61383.23
3rd: 89126.41
101875.70-106275.10 (when overshooting)
4th: 13401.28
151166.97-157451.83 (when overshooting)
5th: 178910.15
These are points that are likely to encounter resistance in the future.
We need to see if we can break through these points upward.
Since it is thought that a new trend can be created in the overshooting zone, you should check the movement when this zone is touched.
If the general upward trend continues until 2025, it is expected to rise to around 57014.33 and then create a pull back pattern.
1st: 43833.05
2nd: 32992.55
-------------------------------------------------- -------------------------------------------
** All explanations are for reference only and do not guarantee profit or loss in investment.
** Trading volume is displayed as a candle body based on 10EMA.
How to display (in order from darkest to darkest)
More than 3 times the trading volume of 10EMA > 2.5 times > 2.0 times > 1.25 times > Trading volume below 10EMA
** Even if you know other people’s know-how, it takes a considerable amount of time to make it your own.
** This chart was created using my know-how.
---------------------------------
5 Non Trading Activities to Success…While charts, trends, risk and reward are our daily companions.
Let’s not forget that life’s full of exciting opportunities beyond the trading desk.
We are human at the end of the day.
And you also need to consider extra elements that will help you propel towards success.
Let’s get into the 5 Non trading activities you need to act on.
Healthy Lifestyle: Trading, Eat, Rest, Gym, Repeat!
Who said trading is all about staring at screens and analyzing numbers?
It’s time to inject some energy into your life!
A healthy lifestyle isn’t just about balance sheets; it’s about balance in everything.
You need to take your vitamins, eat healthy, feel great, hit the gym, go for a run, or channel your inner yogi.
The adrenaline rush from trading pairs perfectly with the endorphin high from a good workout.
The healthier you are, the more sharp your mind will be.
And this will get you to think straight and control your emotions better.
Besides, you are what you eat and what you do.
Mindful Meditation: Zen and the Art of Trading
Mindful meditation isn’t just sitting and going OOOHHM….
It’s for all successful entrepreneurs that deal with daily stresses and risks.
Sometimes you just need to take a breather, clear your mind, and get your mind and thoughts in order.
Whether you meditate, do self-hypnosis or just do deep breathing exercises – this will help you to be a more calmer and clearer thinker as a trader.
When you find your inner peace in your mind, it will reflect on your trading and results.
Continuous Learning
Trading is an ever-evolving game, and the most successful players never stop learning.
I’ve read maybe 200 books on trading in my life and I don’t even think that’s nearly enough to learn everything about the markets.
It’s always crucial for you to dive into new strategies, explore market trends, and devour financial news like it’s the hottest gossip in town.
You need to find yourself in the trading journey. This is a self introspection adventure that is forever going.
Stay curious, stay hungry for knowledge, and watch your trading game reach new heights.
Strong Networking: Bulls, Bears, and Bros
Trading might be a solitary endeavor,.
But success is a team sport.
It’s important to build a network that’s as strong as your risk management skills.
Sign up to trading events, courses, books and programmes.
Connect with fellow traders, and remember, it’s not just about what you know; it’s about who you know.
Your next big opportunity might come from a conversation over coffee rather than a chart analysis session.
Time Management: Trade Like a Pro, Live Like a Boss
In the world of trading, time is money.
But beyond the trading hours, master the art of time management in your personal life.
Schedule downtime, enjoy hobbies, and spend quality time with loved ones.
A well-balanced life isn’t just about maximizing profits; it’s about maximizing joy.
Efficient time management is the key to becoming a trading rockstar without burning out.
So, trade smart, live well, and let success be your favorite trend!
FINAL WORDS:
I trust this has given some food for thought.
That trading isn’t just about technical work. It’s also about inner work.
Work on yourself and become the true trader you aspire to.
Let’s sum up the 5 Non Trading Activities to achieve better success.
Healthy Lifestyle: Trading, Eat, Rest, Gym, Repeat!
Mindful Meditation: Zen and the Art of Trading
Continuous Learning
Strong Networking: Bulls, Bears, and Bros
Time Management: Trade Like a Pro, Live Like a Boss
Why Markets Will Always Change – 9 ReasonsThe only thing constant about financial markets is that they change.
And since 2007 or so, with the higher availability of trading different instruments and markets world-wide.
And not to mention, the ability to go long (buy) and go short (sell).
Yes, these everyday possibilities were difficult to find and trade back then.
Now I’m speaking my age in the markets. But it’s important to know, the algorithms are changing the game every single year.
As long as you’re a trader you need to be able to learn, grow, adapt and evolve with every changing markets.
Let’s go into details about WHY the markets are changing…
New and Old Traders (Volume and liquidity)
Traders are the lifeblood of financial markets.
They come in all shades of experience, net worth, strategies and diversity.
Each new trader and investor, brings fresh perspectives, risk appetites, and systems.
And when they execute, it causes a ripple into the market ecosystem.
Similar to the ‘Butter-fly effect’ where one tiny flutter of the wing can cause weather disturbances which could result in a hurricane.
This blend of old and new creates a constant state of flux, volume, liquidity and adds their unique touch to the market canvas.
New Market Information (Local or international)
Information is the bedrock of trading decisions.
In today’s hyperconnected world, news, data releases, and geopolitical events can instantaneously ripple through markets.
Whether it’s an unexpected earnings report, a geopolitical crisis, FOMC or Central Banks decisions, or a technological breakthrough (like AI).
This new information triggers a financial market reaction.
New Micro, Macro, and Fundamentals (Unrelated to charts and price)
Microeconomic factors include things like: individual company performance.
Also think of corporate actions such as mergers and acquisitions. These will also reshape industry landscapes and impact stock prices.
Fundamentals include any internal news related or announcement event that is NOT related to price and volume action on a chart.
While macroeconomic indicators include: GDP growth with money tightening and injection controls.
While Central banks’ decisions on interest rates, inflation rates and monetary policies influence borrowing costs, investment decisions, and market valuations.
These also play a pivotal role in market dynamics.
As these factors evolve over time, they influence market sentiment (how investors feel on what to buy and sell)
And this obviously drives price movements.
World Economic Info (Major changes happening)
Globalization has interconnected economies in ways unimaginable just a few decades ago.
On the one hand we have 6 more countries joining BRICs. Which is showing the political war and dynamic change between the East and the West.
Economic trends in one part of the world can have far-reaching effects elsewhere.
Trade agreements, currency fluctuations and Forex wars, and shifts in supply chains impact various sectors and industries.
And this can also lead to a change in market price, volume and conditions.
Also, when one event kicks in there is a domino effect.
And this can trigger a cascade of events that reverberate across financial markets worldwide.
Sentiment (How the overall feeling is)
Psychological factors like fear, greed, and uncertainty can drive sudden market movements.
Market sentiment is often reflected in buying and selling volumes.
When investors and traders are feeling optimistic and positive – they buy and hold.
When they are feeling down and negative (about positions) – they sell and short.
High volume with buying or selling can indicate strong conviction – for other investors.
While low volume might signify uncertainty.
This ebb and flow of market participation led to constant changes in market trends and patterns.
Then there are other reasons that financial markets are constantly changing including:
Technological Advancements (At an accelerating rate)
As the world evolves and technology compounds at unprecedented levels, we will see innovations in:
Trading platforms
Algorithms
new instruments & markets
high-frequency trading
New AI related trading bots
Better chart pattern recognition plugins
Improved automatic trading developments.
And emerging technologies can change existing business models in a way they can make them obsolete to totally transform them.
These will all influence market behaviour of demand and supply with investors and traders.
Which will cause a shift and change in price and volume.
Regulatory Changes (Boring but inevitable)
Also, rules.
Rules, regs and legs are always updating and changing.
This will also alter trading practices, liquidity, price movement and market structure.
Political Uncertainty (Fun times ahead for the world)
The rate the world is separating and joining forces in all different ways, there is change coming to the financial markets.
With the EU having control over 27 countries economies.
With BRICs adding another 6 countries to theirs.
With other countries breaking away from the US dollar.
While other companies and countries are switching and adopting more to crypto and AI.
The very foundation of politics and control is changing under our very eyes.
And this will definitely have a major shift in economic directions as well as on the markets.
Natural Disasters and health disasters (Brace yourself and keep your masks)
From Global Warming, to less resources available to mind.
From catastrophic events, floods and droughts.
These can all disrupt supply chains, impact production, and affect the prices of commodities and goods.
And then financial markets and prices, will all be affected.
And what about pandemics?
If we have another COVID-19 type event, this will once again create rapid shifts in consumer behaviour.
And this will have a major impact and ripple throughout companies, industries, countries and essentially the world markets.
FINAL WORDS:
You can clearly see, why financial markets will always change.
And as markets continue to shift and adapt, the only constant is change itself.
So it’s our job to adapt or die.
Embrace it, learn from it, love it and enjoy the process along the way.
It means, this journey and income generating source will NEVER get boring.
It can ONLY get better (well we can be optimistic to think that).
Let’s sum up why the financial markets landscape will always change…
New and Old Traders (Volume and liquidity)
New Market Information (Local or international)
New Micro, Macro, and Fundamentals (Unrelated to charts and price)
World Economic Info (Major changes happening)
Sentiment (How the overall feeling is)
Technological Advancements (At an accelerating rate)
Regulatory Changes (Boring but inevitable)
Political Uncertainty (Fun times ahead for the world)
Natural Disasters and health disasters (Brace yourself and keep your masks)
Learn Profitable Doji Candle Trading Strategy
In the today's post, I will share my Doji Candle trading strategy.
This strategy combines the elements of multiple time frame analysis, price action and key levels.
Step 1
Analyze key levels on a daily time frame.
Identify vertical and horizontal supports and resistances.
Here are the key structures that I spotted on on AUDUSD.
Step 2
Look for a formation Doji Candle on a key structure.
This rule is crucially important: we will trade only the Doji candles that are formed on key levels.
From key supports, we will look for buying, and we will look for shorting from key resistances.
Look at this Doji Candle that was formed on a key daily support on AUDUSD.
Step 3
Look for a horizontal range on a 4h/1h time frames.
Doji Candle signifies indecision. Quite often, you will notice the horizontal ranges on lower time frames when this candlestick is formed.
Here is a horizontal range that was formed on a 4H time frame on AUDUSD after a formation of Doj i.
Step 4
Look for a breakout of the range.
To sell from a key resistance, we will need a bearish breakout of the support of the range. That will be our bearish confirmation.
To buy from a key support, we will need a bullish breakout of the resistance of the range. It will be our bullish signal.
Here is a confirmed breakout of the resistance of the range with a 4H candle close above. That is our bullish confirmation on AUDUSD.
Step 5
Buy aggressively or on a retest.
After you spotted a confirmed breakout of the range, open a trading position aggressively or on a retest.
Personally, I prefer trading on a retest.
If you sell, a stop loss should be above the high of the range and your target should be the closest key daily support.
If you buy, your stop loss should be below the low of the range and a take profit will be on the closest daily resistance.
On AUDUSD, a long position was opened on a retest. Stop loss is lying below the lows. Take profit is the closest resistance.
Here is how the great strategy works!
Always patiently wait for a confirmation! That is your key to successful trading Doji Candle.
❤️Please, support my work with like, thank you!❤️
WHAT ARE Fakeouts, Shakeouts and Whipsaws?YOUR QUESTION ANSWERED!
What on earth are Fake outs, Shake outs and Whipsaws?
After this you will know…
Fake-out:
(When the price makes a false breakout of a chart pattern)
A fake-out occurs when the price of a market appears to break out of a certain chart pattern.
This could be a trendline, support, or resistance level.
But then quickly reverses and retreats back within the pattern.
Shake-out:
(Where the market is highly volatile and the price moves to levels that hits their stop losses and gets traders out of their trades)
A shake-out is a scenario where the market becomes highly volatile and the price moves rapidly to levels that trigger the stop-loss orders of many traders.
Stop-loss orders are pre-set risk levels at which traders automatically exit their positions to limit their losses.
A shake-out is designed to “shake out” weak or inexperienced traders from the market.
When stop-loss orders are triggered, it can create a temporary spike in the opposite direction of the prevailing trend.
Once these traders are “shaken out,” the market might resume its original trend.
You’ll see this most commonly with low liquid, high volatile markets like Penny Stocks or Penny Cryptos.
Whipsaw:
(This is where the market will change its most prominent direction within the day).
Whipsaw refers to a situation where the market quickly changes its direction within a relatively short period, often during a single trading day.
This can cause confusion and losses for traders who are caught off-guard.
Whipsaws can occur due to various factors, such as sudden news releases, economic data surprises, or changes in sentiment.
They are characterized by sharp price movements that can make it difficult to make accurate trading decisions.
Whipsaws are especially common during periods of high market uncertainty or when there’s a lack of a clear trend.
Let’s create a quick summary of the three:
Fake-out:
(When the price makes a false breakout of a chart pattern)
Shake-out:
(where the market is highly volatile and the price moves to levels that hits their stop losses and gets traders out of their trades)
Whipsaw:
(This is where the market will change its most prominent direction within the day).
If you have any trading question let me know in the comments
5 TRADING PROTECTION LEVELS - NB*REMEMBER
Every trader needs 5 protection levels.
Stop loss to stop yourself from furthering losses
Time stop loss to get you out of non-performing trades
Adjusted stop loss to lock in profits when the market moves in your favour.
Risk % per trade to only lose a certain amount of your portfolio
% of Drawdown before you HALT trading - when the market is not in a favourable environment to your strategy.
These are the control factors to manage your portfolio with better direction and management.
What other protection levels do you apply?
The 12 Dangers of Trading DoubtDoubt is danger.
It’s a big enemy for trading.
And it’s something that is innate, which is hard to escape from.
It leads to you to miss opportunities, destroys confidence, clouds judgement and keeps you stuck in a rut.
When you are infected with doubt, this can infiltrate even the most experienced traders.
This article delves into the various dangers of trading doubt and how to overcome its destructive effects.
Missed Opportunities
When doubt creeps in, traders often find themselves hesitating or second-guessing their decisions.
Once you feel hesitation, you’ll miss great opportunities.
Winners will be left on the table.
All because you doubt it’ll go your way and that the markets are conducive.
If you want to stop the doubt you need to act swift and make decisions within three second.
1, 2, 3 – ACT!
Loss in Confidence
Without confidence, you’re going to doubt.
You’re going to question your skills, strategies, and abilities.
As confidence dwindles, you’re going to feel strong fear, panic and worry.
This will lead to irrational decisions driven by emotions rather than logic, rationality and sound analysis.
Change Your System
Even if you have a winning system.
Doubt could cause you to abandon it.
You might already be thinking of finding another.
Looking for better parameters.
Adding extra elements and variables.
This constant tinkering will prevent you from fully realizing the potential of their proven trading strategy and approach.
This is a time game. Not a week, not a month. Noth even three years.
Your trading success will come from being consistent, persistent and consistently applying a well-defined strategy over time.
Search for “Better”
You might even doubt trading all together.
You might have lost a bit of money and now you have this desire to make it back.
So you’ll look into gambling, sports betting, Amway or any other scheme instead.
But you’ll most likely be disappointed. Because everything worth doing well for reward, consists of elements of risk and time.
Don’t Take the Trade
Your finger could be between three stone walls.
Or your finger could be 1 mm from the button.
If you have doubt with your trades, this will paralyse you to enter a trade.
This hesitation will lead you to:
Miss trades
Miss profits
Interfere with the system
Lose confidence
Exacerbate panic and fear
This will only set a precedent for you to do it again.
It’s a bad habit that can destroy you as a trader.
Don’t Follow Criteria
Doubt can lead to a disregard your essential rules.
You might:
Get in at different levels
Move your stop loss further away
Close prematurely for tiny profits or
Take a trade that does NOT match the criteria.
If you question the trading validity of your criteria, this will turn you into an undisciplined and unsuccessful trader.
Overtrading
Once doubt sets in – so will mania.
And to break away from doubt, you take on a dangerous path.
In an attempt to overcome doubt, you might start overtrading or revenge trading.
This is where you’ll enter too many trades in quick succession, without following any criteria.
Emotional Roller Coaster
Doubt is not just feeling lazy.
It actually comes with feelings of frustration, anxiety, and self-doubt dominating their thought process.
This emotional turmoil can cloud judgment and lead to reactive rather than rational decision-making.
Analysis Paralysis
When doubt takes hold, this is where you might go all out with indicators, parameters and price action elements.
This will lead you to excessive analysis.
You’ll continuously seek more information before making a decision.
This analysis paralysis can cause a couple of issues.
It can overcomplicate trading
It makes back and forward testing almost impossible
The variables can cause conflict with each other.
Your charts will look like Christmas trees
This can lead you to miss trading opportunities and an inability to take action.
Inconsistent Results
Consistency is key in trading success.
Doubt-driven decisions can lead you to inconsistent results.
You’ll have your journal with how the trades were SUPPOSED to go.
Versus how you made them go.
And this will make it challenging to gauge the effectiveness of a trading strategy over the long term.
Psychological Toll
Doubt is a constant battle.
If you have this, it will infect your mind it will take a toll on your mental well-being.
It can lead to stress, burnout, and even health issues if you don’t fix them.
Loss Aversion
Doubt can cause a psychological bias known as loss aversion.
This is where traders become will focus to avoid losses rather than maximise their gains.
This mindset can hinder traders from taking necessary risks to achieve substantial profits.
Focus on cutting small losses and banking small profits and you’ll have a recipe for disaster.
It’s time to build your confidence
This will come from working on a trading journal, risking less and building a track record.
Over time, the doubt will creep away and the certainty will override.
Let’s some up the elements of doubt for a trader…
Missed Opportunities
Loss in Confidence
Change Your System
Search for “Better”
Don’t Take the Trade
Don’t Follow Criteria
Overtrading
Emotional Roller Coaster
Analysis Paralysis
Inconsistent Results
Psychological Toll
Loss Aversion
The only constant with trading the markets is...The only thing constant about financial markets is that they change.
And since 2007 or so, with the higher availability of trading different instruments and markets world-wide.
And not to mention, the ability to go long (buy) and go short (sell).
Yes, these everyday possibilities were difficult to find and trade back then.
Now I’m speaking my age in the markets. But it’s important to know, the algorithms are changing the game every single year.
As long as you’re a trader you need to be able to learn, grow, adapt and evolve with every changing markets.
Let’s go into details about WHY the markets are changing…
Since around 2007, the landscape has undergone significant transformations, driven by several key factors that shape the dynamic nature of these markets.
1. Globalisation and Technological Advancements
Traders now are able to gain access to enhanced connectivity, facilitating participation in markets worldwide.
They also have amazing trading and charting platforms like TradingView.
This increased speed of information dissemination and transactions has a profound impact on market dynamics. And this helps contribute to the perpetual state of change.
2. Diversification of Instruments and Markets
The availability of diverse financial instruments, ranging from stocks and bonds to commodities and cryptocurrencies, has expanded trading possibilities.
Each year we seem to have more assets, markets, instruments, structured products and choices.
It's building into a trading universe in a way.
And each market possesses unique characteristics influenced by distinct factors.
This diversity introduces complexity to trading strategies. And this requires traders to navigate a broad spectrum of instruments with different behaviors.
As long as there are new and improved assets, the markets will always change.
3. Long and Short Positions
Unlike in the past, where shorting certain markets proved challenging, the ability to go long (buy) and short (sell) has become more prevalent.
This flexibility allows traders to capitalize on both upward and downward market movements.
With the ability to go long and short a variety of markets, this is changing the financial landscape of the markets.
Price action no longer moves in a Zig Zag 45 degree motion.
There are more dips and rallies without strong trends, like in the past.
All because of the intrciacies of long and short positions also adds intricacy to risk management strategies. talking about algorithms.
4. Rise of Algorithmic Trading
Algorithmic trading has emerged as a game-changer in financial markets.
This involves using computer programs to execute trades based on predefined criteria.
The influence of algorithmic trading is profound, contributing to increased liquidity, faster execution, and the development of innovative trading strategies.
As algorithms evolve each year, they continually reshape the dynamics of the trading landscape.
5. Market Participants and Strategies
The composition of market participants has evolved, with institutional investors, hedge funds, high-frequency traders, and retail traders all playing pivotal roles.
All of a sudden we've seen a spike in the new trend of trading with Smart Money Concepts and Inner Circle Trading, in the last two years.
These changes in the behavior and strategies of these participants can swiftly impact market trends and volatility.
The influx of retail traders, facilitated by online platforms, further adds new dynamics to the markets.
So once again, the only constant for traders is the change that is taking place in the financial landscape and market universe.
Traders who evolve, adapt, acknowledge and respond effectively to the perpetual state of change are better positioned for success in this dynamic and challenging environment.
9 Elements to Master Algo-TradingThere are two types of trading.
Discretionary where you buy and sell based on variable factors.
Mechanical where you buy and sell on fixed factors.
If you want a strong edge with the markets, then you’ll need to consider the latter.
And hence we have algorithmic, or algo trading.
Algo trading, or algorithmic trading, is the use of computer programs to automate the process of trading financial assets.
These programs, or algorithms, execute trades based on predefined rules and criteria.
Now when you dissect algo trading to its core, you’ll realise there are important elements you’ll need to consider to master it.
Element #1. Database Management & Analysis
Algo trading simply begins with a whole bunch of comprehensive and organised data management.
You’ll use the financial markets to generate vast amounts of data, including historical price movements, trading volumes, and momentum indicators.
Basically, you’ll need this database to create a strong back tested analysis.
That way you’ll be able to get the accurate data to tell you how it’s performed, the expectations and the best and worst case scenarios.
Element #2: Statistical Analysis
Once you have the database of tested information.
You’ll be able to work on your statistical analysis to see the inner workings of the system in action.
Win & loss rate
Best & average winners and losers
Drawdown averages
Average trade
Expectancy formula
Biggest and smallest winner & loser
Average week, month, quarter and year
Basically, all the stats you need that forms the bedrock of successful algo trading strategies.
When you have this data you’ll be able to spot trends, correlations, and anomalies within financial data.
Element #3. Pattern Recognition Skills
Pattern recognition is a core competency in algo trading. We aren’t fully there yet with AI, Machine Learning and Deep Learning. But we’re getting there.
With trading expertise combined with algorithmic precision – this will allow computers to find recurring chart patterns, candlestick formations, and technical indicators.
These patterns often help give trends, reversals, potential market movements, and opportunities to enter or exit a trade.
E lement #4. Machine Learning
Machine learning, a subset of artificial intelligence.
By using historical data, machine learning algorithms can adapt and improve trading strategies over time.
So whether you have a moving average, chart patterns, Smart Money Concepts, Fibonacci or any other trading system.
With Machine Learning, it will input more data and will be able to change, add, remove and optimise elements in your strategy to make it MORE successful.
In just no time at all, these algorithms will learn from past successes and failures, fine-tuning trading parameters and strategies to optimise your trading performance.
E lement #5. Trading EA Strategies
Expert Advisors (EAs) are your everyday trading robots.
These are algorithmic programs that are developed for trading platforms like MetaTrader and soon TradingView.
These EAs help you to execute trades based on your pre-defined rules and criteria.
You’ll then be able to design and backtest these strategies to make sure they are viable and profitable in REAL market conditions.
And when it’s time to take trades, EAs do it for you.
They will be able to automate the execution process – with no emotions or hesitance.
This will allow you to capitalise on opportunities 24/7 without any human intervention.
And you no what that means. It’s going to do the job!
Element #6. Problem-Solving Skills
You are going to hit a bunch of obstacles in the way.
There are major challenges when it comes to algo-trading.
And you’ll need to have strong problem-solving skills to overcome them and succeed.
Just like programmers deal with bugs, glitches and problems with code.
You’ll also find problems with paramaters, markets, rules, criteria and risk management calculations.
If you have strong problem-solving skills you’ll be able to quickly identify and sort out the issues, diagnose causes, and find and implement solutions to maintain consistent performance.
Element #7. Attention to Detail
You need to have an eye for algo-trading.
When the smallest discrepancies or inaccuracy can have major consequences for your portfolios performance.
You’ll need to consistently review your strategies, parameters, and data inputs.
That way it’ll help to make sure your system is accurate, reliable and trustworthy.
Element #8. Risk Management
It’s not just about creating a solid trading strategy and system.
You’ll need to have effective risk management too.
With Algo trading, you’ll need to employ a couple of money management techniques like:
Position sizing
Stop-loss orders and criteria
Portfolio diversification
When to close based on over time
When to adjust your positions
When to risk a certain percentage based on different market environments
This will help you to protect, preserve and prosper with your portfolios.
Element #9. Market adaptability
Markets are dynamic.
Markets trend.
Markets move sideways.
Markets jump in irrational circumstances.
As an algo trader, you’ll need to find a way to adapt your system into the programme to identify these market environments.
E.g. When the main market is above the 200MA only look for longs
When the main market is below the 200MA only look for shorts.
When the market is within a box range – Don’t look for any trades.
As you can see, there are many elements to being a successful algo-trader.
It also takes a ton of innovation.
But have this article with you, for when technology and developments improve – You’ll have certain ideas and steps to take to improve your algo trading.
Let’s sum up the important elements to algo-trading…
Element #1. Database Management & Analysis
Element #2: Statistical Analysis
Element #3. Pattern Recognition Skills
Element #4. Machine Learning
Element #5. Trading EA Strategies
Element #6. Problem-Solving Skills
Element #7. Attention to Detail
Element #8. Risk Management
Element #9. Market adaptability
Do you use Algo-Trading with the markets?