Trading Educators Blog

Question from a trader: Joe! I'm not a very creative person, so I tend to use indicators to help me in my testing. I've heard that you are vehemently against indicators. Is that true? Not true! I am not vehemently against anything that works for you in the markets. I am not vehemently against the use of indicators. I have presented many of them in my books. What I am against is the wrong use of in...

Goals, do you have any? Can you spell them out? Do you review them every day? Here's a very easy goal-setting method to follow. Do it, and you will see a huge improvement in your bottom line. Write down the amount of money you are going to make trading next year. "I am making $___ by December 31, 20_." Present tense required, not future tense! Look at that amount every day and affix it on your wal...

Wisdom is said to be the right application of knowledge. Wisdom is a state of consciousness, born from the understanding and awareness of past experiences, and relates to future occurrences. Wisdom allows analysis of present conditions in order to pre-visualize what should occur in the future. Intuition, creativity, and a sense of self-directed destiny are part of wisdom. Knowledge is concerned wi...

As we grow older, many of us tend to lose the amazing traits we possessed as kids. Without those key traits, life becomes all the more difficult. Remember being fearless to try new things as a child? Everything was new to us, so we never stopped to worry what others may think. We all learned so much on our own as children, simply by being open to new experiences. Or how about our willingness to te...

How can you tell if the breakout from consolidation is real or not? Trading rectangular block, i.e. ledges, or sideways chart patterns is a solid market trading approach so long as the breakout is not a false breakout. A legitimate breakout should not retrace to 50% of the block pattern range, as the most profitable trades never retrace below the breakout price. If the low of the daily breakout ba...

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Is your greatest fear in the market that of missing a move? Do you find you are saying to yourself, "I just can't stand the thought of missing 'the big one'?" The best way to handle that kind of fear is walk away from the situation. Get up, and walk away from the computer and any news you may be watching. Remove yourself from whatever it is that triggered the fear. Do anything that will take you o...

The following questions seem to be apropos for the time we are living in. It was sent to me some time ago: Do you think we are going into inflationary markets? And if so how soon? Can you tell us how to trade inflationary markets? Inflationary markets provide ample opportunities to make a lot of bull and bear market profits very fast, with simple technical approaches. Detecting Inflation: Watch th...

The following is from an email I received from a person who is getting it right. I break into the middle: "...Here is where I see that self-control and discipline are paramount; I mean after seeing a perfect pattern form and me not taking the trade due to discretion -- BUT in fact, giving away a juicy profit - it is really KILLING my emotions. If I take the failure of a trade personally after my d...

Are you a creative trader? Are you able to come up with innovative way to make money in the markets? How does one do that? How can a trader become creative? What causes a trader to be creative is a mystery, even to professionals who study such things. Scientists have discovered a few common characteristics that all creative persons possess - a lot of it seems to be the ability to "think outsi...

"I read about a Monday Morning Bull Market Entry Technique. Do you know anything about something like that?" I've run across a few in my many years of trading. Of course, the first step is to be certain that you are in a bull market. Once you know for sure, buy Monday's opening - risk half the range of the previous trading day; price objective is 80% of the three-week average weekly range. If...

I guess from time to time I would say this somewhat differently, but what comes to mind is as follows: Here are five steps to becoming a successful trader: 1. Focus on trading vehicles, strategies, and time horizons which suit your personality. You need to be comfortable. 2. Identify non-random price behavior, wherever you can find it. 3. Absolutely convince yourself that what you have found is st...

A market may be nervous when it goes into consolidation. It may be nervous when you see lots of dojis and flip-flopping – opening high one day and closing low, and then opening low and closing high the next day. A market may be nervous when it is backing and filling – opening on gaps and then filling in those gaps, or trading way up or way down, only to finish back where it started, or at an extre...

The primary job of a market is to fill orders. Everything else that happens is derived from the reality of order filling. You enter a market with the purpose of having your order filled, and there are certain market participants who consider it their job to make a market — they do this by filling orders. Because day trading involves very short-term order filling, often many times per day, it is es...

Why do traders bail out of some markets to go to other contracts? Wouldn't it be better to learn one market and stick with it? The main reason traders bail out of a market is that they are not making any money. This has happened in various ways. In the currencies in the 1990s, for instance, lot sizes became too big for the market movers to fade (take the opposite side). The big players did not wan...

Take note the yearly ranges for the commodities you trade. What are this year's highs and lows? Are they higher highs, lows and closes compared to last year? Does the close confirm the price action? What is the long term trend? How does this year's average price range compare to the last three years' average range? Should next year have greater volatility than this year? How much in dollars was th...

Rather than seeking miracles from mechanical trading systems, I suggest seeking methods and setups that are proven to work most of the time, and learn to stop trading them when they are not working. There are methods and setups available that work from a medium to very high percentage of the time according to how much you try to extract from them. At Trading Educators, we believe in seeking small ...

Would you agree that the most annoying event in trading is the running of your protective stop? Did you know there is a way to prevent this from ever happening? Do you find that you miss a lot of really good trading opportunities because you simply do not have sufficient margin to allow you to take advantage of these opportunities? What if I could show you a way to be able to leverage your margin ...

Hey Joe! I'm an intermediate-term trader in the e-Mini S&P. I'm trying to fill out my trading method so that it is a complete technical trading approach. Do you have any thoughts on this? Following is a technical trading answer: A complete trading approach should equate about two or three weekly intermediate tops and bottoms per monthly major top and bottom movement. About the same number of s...

Grant and Napoleon had an ability that separated them from other generals, the ability to maneuver troops and supplies to their most effective placements under rapidly changing circumstances. Traders should learn how to manage their funds, rework stop placements, and change their position size with changing market conditions. Conducting warfare and trading have many common factors. All modern warf...