Trading Educators Blog

Much seasonally based information conforms to random probability generated data. Avoid trading seasonally based information without a fifteen year pattern, a minimum 80% win probability, profits twice losses, and a price action based entry. Price based trading information is superior to seasonal based information, because a trend or swing can be established before entry. Seasonal trades with less ...

​Richard Wyckoff wrote: "My stop was moved down so there couldn't be a loss, and soon a slight rally and another break gave me a new stop, which insured a profit, come what might… I strongly advocate this method of profit insuring. The scientific elimination of loss is one of the most important factors in the art, and the operator who fails to properly protect his paper profits will find that many...

Have you ever watched the last minute of a close football match and felt excited? When you are anticipating what will happen next, you often feel a little high, especially if you expect a desirable outcome. Humans like excitement. Whether it is a traffic accident on the way to work or the last scene of a murder mystery on television, we like suspense. Trading is naturally exciting, but if you are ...

Every trader makes bad trades and faces regret, it is inevitable. And we all have the human tendency to be overtaken by emotions. When we screw up we have a feeling of loss, and even a sense of denial. We wish we could undo the mistake. Going through such a thought process is understandable. It is what you do about it that matters. Virtually from the time we were born we learn to use our emotions ...

Under what conditions would you like to trade if you had your choice? You would probably want to trade in a strong bull market, be way ahead so that a loss wouldn't hurt at all, and have a foolproof trading plan. In addition, you would want to have a mental edge. You should be in a good mood, alert, and ready to take action. We can't always trade under such ideal conditions, however. If you are a ...

​If you had to describe the best trader in the world, who would that person be? What qualities would he have? Take a moment to envision him. This is important because this is the person you want to be, so you need to have an exact picture of him and what his qualities are. The answer is that he is someone whose trading is somehow "complete". Someone who is controlling his trading at all times; som...

​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 coin...

​Letting your emotions influence your trading decisions is virtually a guarantee that you will lose as a trader. If you are going to survive as a trader you have to bring your emotions under control. If you find that your emotions are swinging up and down as you trade, you have to confront the resulting feelings and deal with them. No one can do this but you. One way to keep emotions under control...

No one enters a trade with the idea of breaking even as a goal. Rather, we set out with high hopes, excitement, and expectancy – the promise of big dreams. But then something odd happens with our trade – we break even. Our reaction is a feeling of annoyance, of let-down. Breaking even happens. It is one of the possible outcomes of a trade. We must not see it as an unwelcome event. Distaste for bre...

​Is there a difference between chart analysis and technical analysis? In my opinion there is. I am surprised at how many traders lump charting together with technical indicators into a category they call "Technical Analysis." I am often accused of being a technical analyst because I am not a fundamental analyst. In the past, I've often carelessly, and without much thought, allowed myself to accept...

​Someone asked, "What in the world is 'covalent bonding of futures pairs?'" Covalent bonding of futures pairs is said to create the best trading system portfolio structure. After the most stable individual futures parameters have been selected, the optimal portfolio should be created. Atoms share electrons to form molecules of a substance. This same covalent bonding process finds the trading syste...

You will need a system or plan if you want to succeed in trading. The usual way of attaining such a system is many days of trading, hard-earned personal experience, analyzing trades you've made to learn from your mistakes, a knowledge of probability, observing other traders, trade simulation, book learning, seminars and mentoring, or any number of similar factors. Such a system will give you ...

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 u...

​Have you ever spent the day making trade after trade and gotten nowhere? You may have wondered why you woke up that morning, or even bothered trading that day. Perhaps there have been a few days where you've felt this way this week. It's been a hard week so far. If you aren't doing very well, it is understandable. Uncertainty abounds. On days when you are feeling unproductive, it's important to h...

​Some have asked for more information about Point and Figure charts. Here's a message from our friend Braam: P&F as I do it is a whole different method of short term trading than you will find in any book. As I always want to improve myself, I have bought all books on P&F. Most of them were a waste of money. But the best I have ever read is "The Definitive Guide to Point and Figure" by Jer...

Recently, I was asked the following question: Do you trade strictly by technical analysis or do you still try to watch the fundamentals as well? For years I have differentiated between chart and technical analysis. Please allow me the courtesy of calling what I use as primarily 'chart' analysis, secondarily at times, technical analysis and when I think it is appropriate I throw in a bit of fundame...

I have to admit I do talk to myself at times, maybe even a lot, especially when I'm facing a loss. Let's say I'm down a bunch of points and it came as the result of a surprise move in the market. The temptation is to think, "I have to find a way to get it back." I hate ending the day down a bunch of money. However, if I give in to that thought, I am focusing on the loss and I'm no longer in the ma...

​The answer is yes. Such an event happened at the Comex a number of years ago! It was called the "Great Silver Fiasco," which was associated with the Hunt brothers. Silver made 19 consecutive moves to the downside, and destroyed several individual commodity traders, when the Comex Board of Directors changed the exchange rules to allow silver prices to fall and not rise. A "liquidation only" restri...

During ongoing activities, such as day trading, you have to learn how to pace yourself. This means alternating between times of intense activity with times of greatly decreased activity, times that require very little of your attention. These "rest periods" should take place when you do not have to quickly react to sudden market moves. This is hard advice to follow for some traders—paranoid, obses...

If you play tennis once a week against an opponent who plays tennis five times a week, who is likely to win? If you play chess or backgammon twice a year against someone who plays every day, who will mostly likely win? You don't have to start trading real money right away. Whenever someone goes through my mentoring program, there comes a time when I encourage the student to start paper trading bef...