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Trading Educators Blog

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Jul
04

Evaluation of your Trading

​ Taking an honest evaluation of your own strengths and weaknesses is crucial to becoming a consistently profitable trader. If you can't identify those habits which continually make (or cost) you money, then you're just shooting in the dark. It's extremely important that you know things about yourself such as: The time of day you are most profitable. The position size that works best for you. Your...
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112 Hits
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Jul
04

Trading Slump

​ Jake has just made three losing trades in a row? He decides he is in a slump and is now worried that he can't get out of it. But is he really in a slump? Perhaps he's just panicking for no good reason. He may just have a pessimistic attitude, but this might be enough to keep him stuck. Thoughts are powerful. The reality of the situation may not matter. All that matters in the end is your percept...
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196 Hits
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Jun
24

What is a mental stop and should I be using them?

What is a mental stop? Why are traders afraid of them? Are they worthwhile? Why would anyone want to use a mental stop? Let's begin with why anyone would want to use a mental stop! It is usually preceded by your having been stopped out of the market only to have the market reverse and go the other way, causing you to miss a possibly profitable trade. That being said we can now address the question...
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99 Hits
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Jun
23

State of Mind

​ Making profits as a trader is often a matter of trading in the proper state of mind. Trading expert Dr. Van K. Tharp, author of several best-selling books on trading psychology and head of the Van Tharp Institute, describes three states of mind that may dictate how you approach trading. As traders gain experience with trading the markets, they move from a "having" state of mind to a "doing" stat...
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294 Hits
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Jun
19

Staying Relaxed

Experience and trading from a plan can help you to make trades in a carefree, relaxed, and focused manner. It is important that you avoid putting unnecessary pressure on yourself. Success or failure is not riding on a single trade. You make it as a trader in the day-to-day trading, learning to be satisfied with what the market hands you. Avoid thinking you have to be right. You cannot impose your ...
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207 Hits
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Jun
13

You Need Control

The need for control is the biggest psychological impediment to profitable trading. Traders strive to control the markets, but in the end, they find that they must accept their fate and settle for controlling their emotions. When your money is on the line, it's difficult to remain calm, rational, and in complete control. You want to win, and there is a strong need to want the market action to fall...
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345 Hits
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Jun
06

Persistence is Needed in Trading

​ Trading is a profession where dare not give up in the face of adversity. You must go into the trading day expecting to have losses. It's not the most optimistic outlook, right? Trading in today's markets isn't like trading in the steadily upward trending markets in the days before the advent of a PC that could let you see charts. In the days when markets trended as opposed to swinging, just abou...
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270 Hits
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Jun
06

Trouble Winning

There has been great interest in the markets lately, so there's no reason that you shouldn't take home huge profits, right? Although many traders profit, there are some who still can't seem to make a profit, even during relatively good times like these. Let's consider some of the psychological impediments that may limit success. The most obvious reason for an inability to win is a lack of experien...
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349 Hits
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May
30

Worry-Free and Profitable

Even though there is great interest in the markets these days, and more opportunities than usual, it's vital to approach trading with the proper mindset. You can't try to do too much, too fast. Successful traders approach trading with a carefree, focused attitude and putting added stress on yourself interferes with attaining this peak performance mental edge. When you are in the proper mindset, yo...
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404 Hits
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May
22

Where the Public Go Next?

​ Even during a strong bull market, you have to do your homework. Many stocks will go up while the public is interested in trading the markets, but not all stocks are equal. Some will go up dramatically while others will barely move. If you want to trade like a master trader, you must closely study the markets to find stocks that are likely to go up. Despite the necessity of studying the fundament...
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325 Hits
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May
22

Believe in Trading

​ Is there anything we can believe when it comes to trading? Is it all lies and fakery? Trading is a challenge. Tens of thousands are drawn to trading, but few last more than a few months. Trading is presented in such a way that it appears to be easy, so it's difficult to face the truth that trading is difficult—at least until you can get the hang of it. Many beginning traders need to win. They ar...
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310 Hits
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May
10

Technical or Fundamental Analysis?

​ There are a number of reasons that many traders favor technical analysis over fundamental. For starters, fundamental traders tend to be commercial firms; that is, they are involved in the actual production or consumption of a commodity. The commercial firms have the information that most of us cannot afford to acquire. For example, are you able to go out and check global soil conditions in an ag...
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208 Hits
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May
10

Is Trading all Lies and Fakery?

​ Trading is a challenge. Tens of thousands are drawn to trading, but few last more than a few months. Trading is presented in such a way that it appears to be easy, so it's difficult to face the truth that trading is difficult—at least until you can get the hang of it. Many beginning traders need to win. They are hoping that the huge profits they make trading will solve many problems in their liv...
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320 Hits
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May
03

Hoping to Break Even

​ Jim has been holding a position for six months. A media analyst predicted the stock would hit $100 by the end of the year. He bought it at $75. It went down to $50, and it's on the way back up. During the recent interest in the markets, Jim is hoping that it will hit $75 so he can sell it and break even. The break-even point is critical. When you are on the losing side of a trade, all you can do...
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419 Hits
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May
03

Big or Small?

Careful risk management is a key component you being able to trade at your best. Comfort level is really important when it comes to risk. You need to be comfortable in three areas: Emotional, Mental, and Financial. We could even add Physical to that list without having to make too great a stretch. If there is a real danger that you will lose large amounts of capital, or money that you just can't a...
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319 Hits
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Mar
14

Confidence

A few years ago I had an interesting conversation with Joe about "what makes a trader a successful trader". We discussed this over several days because we wanted to find out how we can help struggling traders to enhance their trading. We finally came to the conclusion that "confidence" is what makes a huge difference. A trader can have a good system, good money and risk management in place, good u...
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411 Hits
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Mar
07

Striving for Perfection

You will never be a perfect trader. However, as traders we have a strong need to want complete control over the outcome of a trade. We want to believe that if we analyze the markets long enough, we'll have perfect knowledge and we can trade to perfection. But such desire leads to wrong assumptions that can do us more harm than good. Assuming we must have control restricts our actions and reactions...
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423 Hits
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Feb
28

What’s Next?

​ It is Tuesday, and you've been watching the markets closely for the past two weeks. It appears to be the fulfillment of your dreams: prices are making new market highs. You wonder, "What is the smart thing to do?" On the one hand, you can go long, but will this optimism last? Oil prices are still high, but they are lower and a little more stable compared to last summer. Everyone is hoping that c...
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298 Hits
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Jan
31

Managing your Trading Business

​ Keeping Losses Small I cannot say this enough times, so I'm saying it again, you must learn to keep your losses small. It is the single greatest concept that I can show you that will help you make profits in the market. This principle is of such magnitude that it dwarfs all other principles for trade, money, and risk management. Did you know that if you keep your losses small, you can flip a coi...
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344 Hits
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Dec
21

Hesitating before a Trade

​ There are any number of reasons why a trader hesitates before a trade. The main one is lack of planning. Without a plan, there is no degree of confidence a trade will be successful, it's all wishful thinking. Unless they are outright gamblers, traders usually have a strong need to protect their assets and avoid risk. This is especially true for beginning traders. It can take a long time to build...
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497 Hits
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Derivative transactions, including futures, are complex and carry a high degree of risk. They are intended for sophisticated investors and are not suitable for everyone. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results, and all of which can adversely affect actual trading results. For more information, see the Risk Disclosure Statement for Futures and Options.