Thursday, December 11, 2014

Web update ...

ES has rallied dramatically for a few weeks. The past few days have shown strong up moves. Our daytrade system came into today (10/28/14) calling it a “sell day” because of the past few days strength. After this strength, a trader must ...

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ES Turn
5 Minute Bars, 24 Hours
12/9/14
The stock market “tanked” overnight. However, the weekly and daily trends are both up. Therefore, you have to look for buys. 
ES gave a great buy signal. Price formed a Head and Shoulders bottom in the first 3 hours of trading. The Head and Shoulders are labelled. The right shoulder is extended into a “handle” formation.
The breakout happens at 12:35 around 2045. 
The distance from the head to the neckline is the target distance for the projected move above the neckline. This is shown as green arrow. Price goes right to this level around 1257. Which is very close to the previous day’s close.

Emotions, Part 5

A trader must handle Complacency. This can occur after a long winning streak. Always maintain proper leverage. This is NOT the time to double or triple up. Or, risk it all on the next trade.  As my father says “your worst drawdown is always ahead of you.”  Plan accordingly.

Monday, July 8, 2013

5 Emotions, Part 4

The next emotional key to successful trading is to be able to handle the Money.
Look at a systems average loss. Can you take that loss? Can you take that loss on roughly half of every trade you make?
One thing to do is to look at the historical performance and fund the account accordingly. A trader might not want to risk more than 1% of a $50,000 per trade. As such, the trader should only trade systems whose average loss is less than $500.

Friday, July 5, 2013

5 Emotions, part 3

Tony’s third emotion to handle is Desperation.
As traders, we are familiar with desperation. It usually shows up after we’ve had four or five losing trades in a row.
A major advantage of mechanical systems is they can be back tested to show most consecutive losers.  If a system shows 10 or 11 losses in a row over back testing and still performs well, you should expect to have 10 or 11 losses in a row in the future. 
Don’t get desperate. The system is acting within it’s parameters at 4 or 5 losses in a row.  Should the system show 13 or 14 losses in a row in this example, that might be a case to step back and evaluate.

Wednesday, July 3, 2013

5 emotions, part 2

The second key Tony discusses is to learn how to handle frustration. You may get frustrated taking losses. That is part of trading.  Review the systems average loss and percent losers. If you aren’t comfortable with the figures shown, don’t trade the system.
Learn to expect an average trade and an average winning ratio. To expect more is foolish and sets you up for failure.

Tuesday, July 2, 2013

Emotions of Trading

Five Emotional Keys to Handle to Improve Your Trading

Trading is a mental game. It is you versus yourself. You decide every trade. Your emotions are there at every decision.
I recently listened to an audio by Tony Robbins called “The Five Keys to Wealth and Happiness”. In this audio, Tony goes thru five key emotions we face and must handle in order to reach higher levels of achievement. 
Here, I will give you the emotions we all have as traders and how to deal with them and how Futures Truth magazine can help you handle these emotional hurdles and achieve higher levels of trading success.
The first key is to have a positive attitude. How can we have a positive attitude when even the most successful traders lose on half or more of all their trades? 
Only trade with an edge. An advantage. A systematic approach can give you that edge. You will have winners and losers. But, if the system is robust and logical, it should show positive results over the long-term. Realizing this should help you achieve a  positive outlook.
Tony says a negative attitude prevents us from doing the work necessary to succeed. If you expect to fail, how much research of a trading system to use are you likely to do.
Simona Rich writes that the main cause of negative attitudes is a wrong beliefs about life or certain aspects of it. If you belief your trading should result in 90% winners but are trading a system which shows only 60% winners, you will develop a negative attitude.
Tony further states that having a NEGATIVE attitude destroys discipline.  Discipline is a key foundation to all trading success. So, a positive attitude is key.