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Saturday, 17 September 2011 05:43 |
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The title of this blog says it all when it comes to success as a professional trader. Success (making money) in trading is directly correlated to the amount of work you are willing to put in not just during market hours but I think more importantly after the markets are closed. Weekends are an especially good time for me to put in that extra effort. When the markets are closed I am able to put my whole focus behind the process of analyzing my performance and I can be most objective. First, I start out by reading through the previous 5 days journals and look for common themes to tell me if I keep making the same mistake over and over or if there is a certain setup that is just killing it everytime I see it. Clarity is King in my world and the more clear I can be about the good and bad from last week the better I will perform next week. Second, I look at charts in my larger universe and see patterns developing that will start my mind working on a broad thesis for the weeks trading. I am watching to see if stocks are overbought/sold, where is resistance or support, MACD crosses, sectors that look attractive for trading. The last step is to take an assessment of your "trading streak", for me that is the last 20 trading days. If I am in a good streak and making smart trades and stron P&L, then I want to push myself to bigger size and out of my comfort zone. If those 20 days are not up to my standards, then I want to be more conservative in my planning and focus on simply a solid week. I will go through this process early Saturday morning and then finish late Sunday night. The purpose of that is to keep my mind on trading seven days a week, I do not want to get sloppy and breaking up this exercise over the two days is the remedy. Try these three steps and you will see improvement in all facets of running your trading business.
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Friday, 16 September 2011 08:25 |
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Yesterday I identified that the bank names, both investment banks and regional banks had upside potential based on solid technical formations and I was able to buy a number of them for solid gains. My best point gainer was GS for $4 as I entered pre-market and held for the entire day. I was speaking to a student late in the day going over some of his trades and we discussed the GS trade which he was amazed that I was in for the whole day. He works at a prop firm and most of his peers are heavy scalpers. What I focus on teaching is that it is the quality of the trade and the quality of your setups that are most important, especially when starting out. Young traders look at the law of large numbers and confuse that with taking every trade they see but most traders that do this just churn up their account and spend a fortune in commissions. Figure out what setups work best for you and when it is working build up into big positions, let your losers stay small. Sometimes I trade very little in the day because my setups are not there and some days are more active but I want to be in business for the long run and making sure I understand my perfect setup and the best way to trade ithat setup is paramount to any traders success. Go for quality and do not get sucked into the undiscipline traders around you as they churn away. To sign up for our October class, CLICK HERE and send me your contact information.
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Thursday, 15 September 2011 08:33 |
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I have been very busy these last few weeks making many changes to the training program, revamping some of the lessons, rewriting my ebook and of course teaching and trading. I have always been one to focus more on my best setups but of course that is not always the case, but I find that as busy as i am I do not have the time to waste on trades that do not provide the best chance to make money. Being selective has many benefits and I find that during my preparation time is when I get to formulate what I believe may transpire throughout the day. I have written a recent blog regarding a setup that occurs when the Pivot Point (PP) lines up closely with either S3 or R3 and how that is an added level of support at S3 or resistance at R3. When I see a number of these same setups on a given morning in my prep time, that helps me formulate how the day should play out. Today afforded me a great setup with a few names with nice buy areas down near S3 and support from the daily chart. I referenced a few of these in my morning call, QQQ, IWM, VMW, NVDA and SNDK. The problem is that none of these names reached my target and therefore left me with a very light trading day. A great lesson here is to not get upset when this happens it is very common. But the other side of the lesson is that when you have a day when your setups are great and the trades do appear you need to make the most out of it. Focus on your most profitable setups, when the trade starts to work, press it up maximize your gain and be very patient. Happy Trading!
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