I don't have much new to blog about since my last one because I have been more wrapped up in The Masters as I am every year. I may be biased but it is the most beautiful golf course in America. I think the south has some of the most beautiful plants, flowers, and trees on earth and they are all on display at Augusta National.
I do want to share with you a post from about a year ago that is on the "Bull Markets" message board. It would be a good idea to print these out and keep them handy because these could save you one day. I can honestly say I make sure I do my best not make any of these mistakes. No one is perfect but when I get out of sorts I am making one or more of these mistakes.
Maybe the same old good advice...but how come we make these mistakes again and again?
1. Not having a plan - Without a plan, you are vulnerable to all kinds of emotions that make you act the wrong way at the worst moment. Before entering a trade, make sure you defined why you enter at this moment, the loss limit and the target. The trade must be part of a general strategy that you have tested and that will be applied over and over with consistency. If you are not sure about how to define and test a plan, you may follow a serious trading service and learn how to do it.
2. Forgetting the plan! - Under pressure, the human brain creates all sorts of strains and ideas that are not all beneficial to trading, far from for it. The best way not to be swayed by events is to blindly stick to the plan like a robot. After all, you tested it and it held water, right? The plan is the psychological lifeline.
3. Wanting to be right. - Unfortunately for the smartest and most educated among us, trading is not about being right by virtue of one's reasoning. It is about being right by virtue of events. The most pragmatic will win. Willing to get it right every time would make you stay too long in a losing trade, and at the end you will exit at a cost anyway and probably at the worst time. Accept with humility to be wrong and to lose what you have budgeted,. It can be half of the time, or many times in a row, it does not matter. It is a game of probability and of statistical expectation, not a game of truth nor an academic test.
4. Not caring about money management. - Money is your tool and your raw material; it has to be carefully managed. The management rules are part of the famous trading plan. Decide what portion of the trading capital you will bet, meaning you are ready to lose, on each trade. It is typically between 0.5 and 2% depending on the experience and the type of operation. Then compute the size of the position accordingly. To learn how to make this calculation,see this post. This approach strongly diminishes the chances of running out of capital after a streak of losses.
5. Expecting an oversized return from each trade. - Observation shows that a very small percentage of trades have a high profitability. Most of the trades will be either losers, or modest winners. The aim is that modest winners overcome the losers. Then the rare home runs will be bonuses and make the overall results brilliant. But if you dream about a high return for each trade, you won't be swift enough to take moderate profits and you will end up having more losers than necessary.
6. Limiting the size of the gain. - Abiding to the previous advice, some traders are too quick to cut the trades as soon as they have a small gain and feel reassured when they book many, limited profits. But doing this, they refuse to expose themselves to the exceptional, "black swan" type of event that can really spice up their trading. Letting the profits run while limiting the losses with stop-loss order renders the trading game asymmetrical in you favor. There is no paradox between this advice and the previous one: do not expect a fantastic profit on any particular trade, but give yourself the chance to harvest such a profit if it presents itself. There are several trade management techniques for that.
7. Entertaining unrealistic expectations. - A direct consequence of what has just been said. Generally, you will be grinding and milling profits day after day, like a shop keeper. Don't think you will earn a living by going "all in" and raking the table. You may do this a couple of times, but the hard laws of probability make sure that you surely blow your account at some point. Think of your trading position as items you want to sell at a given price, with a margin. Then carefully collect the margins.
8. Not defining expectations according to the plan. - Obviously, there is a relation between the plan (see 1 and 2) and what you can expect. Always do a calculation, be it sketchy or very approximate, of which level of expectations is supported by the plan, using what you know from back-testing or practical experience.
9. Looking for fun in trading. - If you trade in order to entertain yourself or for a thrill, or just because you are bored, you will lose. Good and profitable trading must be kind of boring, because then you just apply a pre-adopted plan. You separate execution from research and from strategy. Research on the trading plan may be and should be fun and thrilling, and this the pleasure moment. Then when execution begins, it is a business moment. What you enjoy when trading is not the effect of your smartness or your creativity: you enjoy being capable of applying a method with seriousness and discipline. Learn to pat yourself in the back just for being disciplined, even when the trade loses. It is a game of probability in the long run, not of being right (see 3)
10. Not reviewing what you have done. - Reviewing past trades serves two very distinct objectives. First, examining every trade, even the winners, is a way of checking to what extent you are applying the plan. In that respect you are controlling yourself. This must be done every week or even every day for the day traders. A second very different purpose is to evaluate not yourself, but the plan. No plan is ever perfect an each one can be slowly improved over time (but not radically transformed at every review!). Looking at the reasons why losing trades were such while the plan was applied may help you fine tuning some features (stop orders placement, profit targets...). Here the frequency of review is once a month, or less for day traders. Make changes to the plan only based on a review of several dozens trades.
Building Dreams One Trade at a Time!
Sunday, April 12, 2015
Tuesday, February 3, 2015
5 Steps to Becoming a Professional Trader
I was cleaning out some files on my laptop and I came across this article I copied and pasted into a word document last year so I could print it and carry it with me. I don't remember where I got it from or who wrote it. All I know is that it changed my life as I pursued a career as a trader. I wanted to share it but I was not about to type all of it. I am not a good typist and it would have taken me days. You may have already seen it before but if not, I would suggest you print it out and read it several times. If you are new and pursuing a career as a trader, this should be a mandatory read.
Step One: Unconscious Incompetence
This is the first step you take when starting to look into trading. You know that it is a good way of making money because you've heard so many things about it and heard of so many millionaires. Unfortunately, just like when you first desire to drive a car you think it will be easy – after all, how hard can it be? Price either moves up or down – what’s the big secret to that then – let’s get cracking!
Unfortunately, just as when you first take your place in front of a steering wheel you find very quickly that you haven’t got the first damn clue about what you’re trying to do. You take lots of trades and lots of risks. When you enter a trade, it turns against you, so you reverse and it turns again, and again, and again. You may have initial success and that’s even worse because it tells your brain that this really is simple and you start to risk more money. You try to turn around your losses by doubling up every time you trade. Sometimes you’ll get away with it but more often than not you will come away scathed and bruised. You are totally oblivious to your incompetence at trading.
Step Two – Conscious Incompetence
Step two is where you realize that there is more work involved in trading and that you might actually have to work a few things out. You consciously realize that you are an incompetent trader – you don’t have the skills or the insight to turn a regular profit.
You now set about buying trading systems and e-books galore, read websites based everywhere from USA to the Ukraine and begin your search for the Holy Grail. During this time you will be a system nomad – you will flick from method to method day by day and week by week never sticking with one long enough to actually see if it does work. Every time you come upon a new indicator you’ll be ecstatic that this is the one that will make all the difference.
You will test out automated systems, you’ll play with moving averages, Fibonacci lines, support & resistance, pivots, fractals, divergences, DMI, ADX, and a hundred other things all in the vein hope that your ‘magic system’ starts today. You will also become a top and bottom picker, trying to find the exact point of reversal with your indicators and you’ll find yourself chasing losing trades and even adding to them because you are so sure you are right.
You’ll go into the live chat room and see other traders making profits and you want to know why it’s not you – you’ll ask a million questions, some of which are so dumb that looking back you feel a bit silly. You’ll then reach the point where you think all the ones who say they are making profits are all liars – they can’t be making that amount because you've studied and you don’t make that, you know as much as they do and they must be lying. But they’re in there day after day and their account just grows whilst yours falls.
You will be like a teenager – the traders that make money will freely give you advice but, you’re stubborn and think that you know best – you take no notice and over trade your account even though everyone says you are mad to but you know better. You’ll consider following the calls that others make but even then it won’t work so you try paying for signals from someone else – they don’t work for you either. You might even approach a guru or someone on a chat board who promises to make you into a trader (usually for a fee of course). Whether the guru is good or not you won’t win because there is no replacement for screen time and you still think you know best. This step can last ages and ages – in fact in reality talking with other traders as well as personal experience confirms that it can easily last well over a year and more nearer to three years.
This is also the step when you are most likely to give up through sheer frustration. Around 60% of new traders quit in the first 3 months – they give up and this is good – think about it – if trading was easy we would all be millionaires. Another 20% keep going for a year and then in desperation take risks guaranteed to blow their account which of course it does. What may surprise you is that of the remaining 20% all of them will last around 3 years and they will think they are safe in the water but even at 3 years only a further 5-10% will continue and go on to actually make money consistently.
By the way – these are real figures, not just some I've picked out of my head – so when you get to 3 years in the game don’t think it is plain sailing from there! I've had many people argue with me about these timescales – funny enough none of them have been trading for more than 3 years – if you think you know better – then ask on a board for someone who’s been trading 5 years and ask them how long it takes to become fully 100% proficient. Sure I guess there will be exceptions to the rule – but I haven’t met any yet.
Eventually you do begin to come out of this phase. You've probably committed more time and money than you ever thought you would, lost 2 or 3 loaded accounts and all but given up maybe 3 or 4 times but now it is in your blood. One day – in a split second moment you will enter stage 3.
Step 3 – The Eureka Moment
Towards the end of stage two you begin to realize that it’s not the system that is making the difference. You realize that it is actually possible to make money with a simple moving average and nothing else IF you can get your head and money management right. You start to read books on the psychology of trading and identify with the characters portrayed in those books and finally comes the eureka moment. This eureka moment causes a new connection to be made in your brain. You suddenly realize that neither you, nor anyone else can accurately predict what the market will do in the next ten seconds, never mind the next 20 minutes. Because of this revelation you stop taking any notice of what anyone thinks – what this news item will do, and what that event will do to the markets. You become an individual with your own method of trading. You start to work just one system that you mold to your own way of trading, you’re starting to get happy and you define your risk threshold.
You start to take every trade that your ‘edge’ shows has a good probability of winning with. When the trade turns bad you don’t get angry or even because you know in your head that as you couldn't possibly predict it it isn’t your fault – as soon as you realize that the trade is bad you close it. The next trade or the one after it or the one after that will have higher odds of success because you know your system works. You stop looking at trading results from a trade-to-trade perspective and start to look at weekly figures knowing that one bad trade does not a poor system make.
You have realized in an instant that the trading game is about one thing – consistency of your ‘edge’ and your discipline to take all the trades no matter what as you know the probabilities stack in your favor.
You learn about proper money management and leverage – risk of account etc. – and this time it actually soaks in and you think back to those who advised the same thing a year ago with a smile. You weren't ready then but you are now. The eureka moment came the moment that you truly accepted that you cannot predict the market.
Step 4 – Conscious Competence
You are making trades whenever your system tells you to. You take losses just as easily as you take wins. You now let your winners run to their conclusion fully accepting the risk and knowing that your system makes more money than it loses and when you’re on a loser you close it swiftly with little pain to your account.
You are now at a point where at a minimum you break even – day in day out. You will have weeks where you make big money and other weeks where you lose big money – but overall you are breaking even and not losing money anymore. You are now conscious of the fact that you are making calls that are generally good and you are getting respect from other traders as you chat the day away. You still have to work at it and think about your trades but as this continues you begin to make more money than you lose consistently. You’ll start the day on a big win, take a big loss and have no feelings that you've given those profits back because you know that it will come back again. You will slowly begin to make consistent profits week in and week out.
Step Five – Unconscious Competence
Now we’re cooking – just like driving a car, every day you get in your seat and trade. You do everything now on an unconscious level. You are running on autopilot. You start to pick the really big trades and getting big profits in a day doesn't make you any more excited that getting none. You see the newbies in the forum shouting ‘go market go’ as if they are urging on a horse to win in the grand national and you see yourself – but many years ago now. This is trading utopia – you have mastered your emotions and you are now a trader with a rapidly growing account.
You’re a star in the trading chat room and people listen to what you say. You recognize yourself in their questions from about two years ago. You pass on your advice but you know most of it is futile because they’re teenagers – some of them will get to where you are – some will do it fast and others will be slower – literally dozens and dozens will never get past stage two, but a few will.
Trading is no longer exciting – in fact it’s probably boring you to pieces – like everything in life when you get good at it or do it for your job – it gets boring – you’re doing your job and that’s that.
Finally you grow out of the chat rooms and find a few choice people who you converse with about the markets without being influenced at all. All the time you are honing your methods to extract the maximum profit from the market without increasing risk. Your method of trading doesn't change – it just gets better – you now have what women call ‘intuition.’ You can now say with your head held high “I’m a trader” but to be honest you don’t even bother telling anyone – it’s a job like any other.
I hope you've enjoyed reading this journey into a traders mind and that hopefully you've identified with some points in here.
Remember that only 5% will actually make it – but the reason for that isn't ability, its staying power and the ability to change your perceptions and paradigms as new information comes available. The losers are those who wanted to ‘get rich quick’ but approached the market and within 6 months put on a pair of blinkers so they couldn't see the obvious – a kind of “this is the way I see it and that’s that” scenario – refusing to assimilate new information that changes that perception.
I’m happy to tell you that the reason I started trading was because of the ‘get rich quick’ mindset. Just that now I see it as ‘get rich slow.’ If you’re thinking about giving up I have one piece of advice for you ….
Ask yourself the question “How many years would you go to college if you knew for a fact that there was a million dollars a year job at the end of it?”
Take care and good trading to you all. – Anonymous
Step One: Unconscious Incompetence
This is the first step you take when starting to look into trading. You know that it is a good way of making money because you've heard so many things about it and heard of so many millionaires. Unfortunately, just like when you first desire to drive a car you think it will be easy – after all, how hard can it be? Price either moves up or down – what’s the big secret to that then – let’s get cracking!
Unfortunately, just as when you first take your place in front of a steering wheel you find very quickly that you haven’t got the first damn clue about what you’re trying to do. You take lots of trades and lots of risks. When you enter a trade, it turns against you, so you reverse and it turns again, and again, and again. You may have initial success and that’s even worse because it tells your brain that this really is simple and you start to risk more money. You try to turn around your losses by doubling up every time you trade. Sometimes you’ll get away with it but more often than not you will come away scathed and bruised. You are totally oblivious to your incompetence at trading.
Step Two – Conscious Incompetence
Step two is where you realize that there is more work involved in trading and that you might actually have to work a few things out. You consciously realize that you are an incompetent trader – you don’t have the skills or the insight to turn a regular profit.
You now set about buying trading systems and e-books galore, read websites based everywhere from USA to the Ukraine and begin your search for the Holy Grail. During this time you will be a system nomad – you will flick from method to method day by day and week by week never sticking with one long enough to actually see if it does work. Every time you come upon a new indicator you’ll be ecstatic that this is the one that will make all the difference.
You will test out automated systems, you’ll play with moving averages, Fibonacci lines, support & resistance, pivots, fractals, divergences, DMI, ADX, and a hundred other things all in the vein hope that your ‘magic system’ starts today. You will also become a top and bottom picker, trying to find the exact point of reversal with your indicators and you’ll find yourself chasing losing trades and even adding to them because you are so sure you are right.
You’ll go into the live chat room and see other traders making profits and you want to know why it’s not you – you’ll ask a million questions, some of which are so dumb that looking back you feel a bit silly. You’ll then reach the point where you think all the ones who say they are making profits are all liars – they can’t be making that amount because you've studied and you don’t make that, you know as much as they do and they must be lying. But they’re in there day after day and their account just grows whilst yours falls.
You will be like a teenager – the traders that make money will freely give you advice but, you’re stubborn and think that you know best – you take no notice and over trade your account even though everyone says you are mad to but you know better. You’ll consider following the calls that others make but even then it won’t work so you try paying for signals from someone else – they don’t work for you either. You might even approach a guru or someone on a chat board who promises to make you into a trader (usually for a fee of course). Whether the guru is good or not you won’t win because there is no replacement for screen time and you still think you know best. This step can last ages and ages – in fact in reality talking with other traders as well as personal experience confirms that it can easily last well over a year and more nearer to three years.
This is also the step when you are most likely to give up through sheer frustration. Around 60% of new traders quit in the first 3 months – they give up and this is good – think about it – if trading was easy we would all be millionaires. Another 20% keep going for a year and then in desperation take risks guaranteed to blow their account which of course it does. What may surprise you is that of the remaining 20% all of them will last around 3 years and they will think they are safe in the water but even at 3 years only a further 5-10% will continue and go on to actually make money consistently.
By the way – these are real figures, not just some I've picked out of my head – so when you get to 3 years in the game don’t think it is plain sailing from there! I've had many people argue with me about these timescales – funny enough none of them have been trading for more than 3 years – if you think you know better – then ask on a board for someone who’s been trading 5 years and ask them how long it takes to become fully 100% proficient. Sure I guess there will be exceptions to the rule – but I haven’t met any yet.
Eventually you do begin to come out of this phase. You've probably committed more time and money than you ever thought you would, lost 2 or 3 loaded accounts and all but given up maybe 3 or 4 times but now it is in your blood. One day – in a split second moment you will enter stage 3.
Step 3 – The Eureka Moment
Towards the end of stage two you begin to realize that it’s not the system that is making the difference. You realize that it is actually possible to make money with a simple moving average and nothing else IF you can get your head and money management right. You start to read books on the psychology of trading and identify with the characters portrayed in those books and finally comes the eureka moment. This eureka moment causes a new connection to be made in your brain. You suddenly realize that neither you, nor anyone else can accurately predict what the market will do in the next ten seconds, never mind the next 20 minutes. Because of this revelation you stop taking any notice of what anyone thinks – what this news item will do, and what that event will do to the markets. You become an individual with your own method of trading. You start to work just one system that you mold to your own way of trading, you’re starting to get happy and you define your risk threshold.
You start to take every trade that your ‘edge’ shows has a good probability of winning with. When the trade turns bad you don’t get angry or even because you know in your head that as you couldn't possibly predict it it isn’t your fault – as soon as you realize that the trade is bad you close it. The next trade or the one after it or the one after that will have higher odds of success because you know your system works. You stop looking at trading results from a trade-to-trade perspective and start to look at weekly figures knowing that one bad trade does not a poor system make.
You have realized in an instant that the trading game is about one thing – consistency of your ‘edge’ and your discipline to take all the trades no matter what as you know the probabilities stack in your favor.
You learn about proper money management and leverage – risk of account etc. – and this time it actually soaks in and you think back to those who advised the same thing a year ago with a smile. You weren't ready then but you are now. The eureka moment came the moment that you truly accepted that you cannot predict the market.
Step 4 – Conscious Competence
You are making trades whenever your system tells you to. You take losses just as easily as you take wins. You now let your winners run to their conclusion fully accepting the risk and knowing that your system makes more money than it loses and when you’re on a loser you close it swiftly with little pain to your account.
You are now at a point where at a minimum you break even – day in day out. You will have weeks where you make big money and other weeks where you lose big money – but overall you are breaking even and not losing money anymore. You are now conscious of the fact that you are making calls that are generally good and you are getting respect from other traders as you chat the day away. You still have to work at it and think about your trades but as this continues you begin to make more money than you lose consistently. You’ll start the day on a big win, take a big loss and have no feelings that you've given those profits back because you know that it will come back again. You will slowly begin to make consistent profits week in and week out.
Step Five – Unconscious Competence
Now we’re cooking – just like driving a car, every day you get in your seat and trade. You do everything now on an unconscious level. You are running on autopilot. You start to pick the really big trades and getting big profits in a day doesn't make you any more excited that getting none. You see the newbies in the forum shouting ‘go market go’ as if they are urging on a horse to win in the grand national and you see yourself – but many years ago now. This is trading utopia – you have mastered your emotions and you are now a trader with a rapidly growing account.
You’re a star in the trading chat room and people listen to what you say. You recognize yourself in their questions from about two years ago. You pass on your advice but you know most of it is futile because they’re teenagers – some of them will get to where you are – some will do it fast and others will be slower – literally dozens and dozens will never get past stage two, but a few will.
Trading is no longer exciting – in fact it’s probably boring you to pieces – like everything in life when you get good at it or do it for your job – it gets boring – you’re doing your job and that’s that.
Finally you grow out of the chat rooms and find a few choice people who you converse with about the markets without being influenced at all. All the time you are honing your methods to extract the maximum profit from the market without increasing risk. Your method of trading doesn't change – it just gets better – you now have what women call ‘intuition.’ You can now say with your head held high “I’m a trader” but to be honest you don’t even bother telling anyone – it’s a job like any other.
I hope you've enjoyed reading this journey into a traders mind and that hopefully you've identified with some points in here.
Remember that only 5% will actually make it – but the reason for that isn't ability, its staying power and the ability to change your perceptions and paradigms as new information comes available. The losers are those who wanted to ‘get rich quick’ but approached the market and within 6 months put on a pair of blinkers so they couldn't see the obvious – a kind of “this is the way I see it and that’s that” scenario – refusing to assimilate new information that changes that perception.
I’m happy to tell you that the reason I started trading was because of the ‘get rich quick’ mindset. Just that now I see it as ‘get rich slow.’ If you’re thinking about giving up I have one piece of advice for you ….
Ask yourself the question “How many years would you go to college if you knew for a fact that there was a million dollars a year job at the end of it?”
Take care and good trading to you all. – Anonymous
Sunday, January 11, 2015
What I Learned in 2014
What I Learned in 2014
January 2015 marks my 1 year anniversary in day
trading. I felt that in honor of my 1st
year, I would reflect on the things I have learned over the past year. In education, reflection is the key to
becoming a better educator. I have used it to become a better teacher, and
about halfway through 2014 I realized that I could use it to be a better trader
as well. In this blog I will share the
things that I have learned about my trading that has consistently helped me to
move forward toward making this a career.
I know they have worked for me because when I stopped and looked back
over my first 5 months, made adjustments, I went from $800 to a little over
$9800 in 6 months. Yes I used too much leverage
and traded with way too much size in relation to my account size, which is a
mistake I will not make this year. As I
looked over what I did, I see that I was 1 trade away from blowing up! I will
be more responsible this year.
Lesson 1: It is so
easy to get lost in the market, in a trading community, or just life in general. It is not wrong to be driven in the pursuit
of success. To be successful in anything
I do I know I have to have passion and be driven to accomplish my goals. It is when I get lost and disconnected from
the world around me that the problems come in.
I learned I have to stop and self-reflect to make sure I’m still on the
right track to accomplish my goals. I have to take time to specifically focus
on questions about my goals and my general state of mind. it wasn't until I started taking steps back
each week to analyze where I was in reaching my goals, to decide whether based
on what I have learned this week, are my goals realistic, and how I may need to
adjust my strategic plan to reach my goals, that things started making sense to
me. I had to detach myself from Twitter, chatrooms, charts, etc. I had to set aside time each week to unplug
from everybody and everything.
Lesson 2: I learned
that I can’t try and take short cuts and find deals on everything. With the exception of FINVIZ, Twitter, and
YouTube, all the tools I need to be successful costs money. I know the TOS platform and other platforms
are supposedly free but we pay for it in other ways. I can honestly say it is all worth it. For instance, I pay $150 a month for
EquityFeed. If I find just 1 or 2 trades I have made my money back. Everything after that is just gravy. I look at everything as just the cost of
doing business. If I use the tools
correctly and I trade correctly, I make money.
Anyway, it’s tax deductible!
Lesson 3: About
halfway through the year I realize I hated OTC’s. I especially didn't like shorting them. It seemed like shorting crappy OTC’s was the
only way make money with them. So in May
I started looking for something different and that’s when I found Nate at
Investors Underground and his DVD Textbook Trading. Before I bought in I watched some of his
video lessons posted on his YouTube channel and asked a few people I knew. I made the mistake of jumping in chat too
soon because I spent more time trying to figure out what they were talking
about. I spent a couple of weeks on the
video and got a good fundamental understanding of how the community trades and
their lingo. It helped me learn which setup I liked the best without paying any
tuition in the market. Once I got my
bearing it was great. So the lesson I
learned is that if you join any chat, make sure you take some time and learn
the language of that community. It can
determine whether you will get anything from your subscription or not.
Lesson 4: I learned
that for a new person starting out that it is best to focus on one type of
setup at a time. As I said before I used
the DVD to help me identify the setup I liked the best. Make sure you can correctly identify and
trade that setup before you start looking at another one. When I did that I started making money. I put all of my time and energy in to studying
everything about the setup I liked the best. I planned to build up some capital with it
before I start branching off. So in
2015, I will start learning short setups.
Lesson 5: I learned
that you really only need to follow 1 Guru and his community. If you’re trading GURU A’s setups, don’t look
at GURU B to give advice. It doesn't
work. I did my homework and found
someone that is genuinely interested in teaching you to be an independent
thinker and how to understand every part about their trading strategies. I knew that if I wanted to be successful in
this that I had to learn how to stand on my own 2 feet. I am not in chat during the school year
because it doesn't benefit me. I will
get back in during the summer and when I go full time, I will be in chat full
time. I know that there are free chatrooms
out there but I will not contaminate my mind or cloud my judgment. I am successful trading and I am not going to
mess that up.
Lesson 6: I needed to
trade small to eliminate as much emotion from my trading decisions as I could. I came up with an amount I was willing to
loose and stuck with it. I started
trading 100 share positions on stocks less than $3. There were limited opportunities in NASDAQ’s
but I wanted to practice identifying and trading patterns. As my winning % improved, I took larger
sizes. I was able to get all of the dumb
mistakes you make when new out of the way and gain valuable live trading
experience. I did not paper trade
because I felt it wasn't real. For me there
is no emotional attachment to fake money.
Trading small helped me learn how to manage my emotions when a trade
didn't move the right way initially. I
learned how to respect the plan and if a stock didn't cross the line in the
sand I set before the trade, it stays on.
90% of the time the stock came roaring back and I was green again.
Lesson 7: Cut losses
quickly. Sometimes I had to admit when I
was wrong. I had a hard time with this
because I felt that if I was wrong, I was not learning and I might not be cut
out for this. I had to realize that even
the best traders are wrong. The setup
may be right, but the market decides if you are right or not. Once I was comfortable with this and knew that
I was able to cut losses fast and not worry about a winning %, I could trade
with more size. Since I had a small
account I had to protect my capital and could not afford big losses. I learned that cutting losses quickly had to
be a part of my trading plan and that it could actually allow me to make more
money in the long run.
Lesson 8: I learned
that I needed to take profits on the way up.
It is hard to do with a 100 share position but I had to set a goal to
take profits when a stock reached a certain point, regardless of what I thought
it might do. When I started trading with
1000 shares, I could take ½ off at 3% gain and let the rest work. I figured that I would not trade a ticker
unless I expected at least a 5% overall move anyway. Now, I always take profits
on the 1st red candle during a move.
I always make sure I pay myself something. I had so many trades that I could have made
$75 to $100 on but didn't take some profits off the table and ended up
losing. With a small account these $75
and $100 wins add up, especially if you do several a day.
Lesson 9: I learned
to only trade when I have a setup that I like.
I learned not trade out of boredom.
I learned not to chase stocks that setup but I missed my entry. I had to realize that I am only trading 1
strategy and if the market is down or slow, I may not have any trades that day
or I may miss the entry on the one that setup.
The next day may bring more than I can handle. I had to learn to be patient and only trade
my setups.
Lesson 10: I had to reduce my trading station from watching 4 screens to 3. Too much "noise" when I'm trying to trade was killing me. I was missing more trades than I found because I was looking at too much.
Lesson 10: I had to reduce my trading station from watching 4 screens to 3. Too much "noise" when I'm trying to trade was killing me. I was missing more trades than I found because I was looking at too much.
Lesson 11: Last, but
not least, and I should have known this from the start, there is no substitute
for education. Textbook Trading and Tandem Trader were my best investments. Without them I would be nothing right now.
Watching all the video lessons I can and participating in all of the webinars I
can I know makes a difference. I had to
take a step back, take my time and learn what I needed to so I could be
successful.
So I can sum it up like this; Reflection, Education, Patience,
Education, Patience, Reflection. I know
I will never stop learning in this business.
Wednesday, January 7, 2015
How I Find Stocks to Trade: Part II
How I Find Stocks to Trade Part II
My Morning Scans
I like to make premarket scans because it can give me stocks
that are gaining momentum that missed all of the scans the previous night. I pay close attention to the volume
though. If a stock jumped up $2 but only
shows 1 or 2 trades and low volume, then it’s just noise. If the volume is high along with a high
percentage move, then I have a good chance to predict the trend for the day. My favorite early trade setups are the gappers,
or stocks that have gapped up premarket.
I have a specific strategy to trade those and often times I will have 2
opportunities to trade that one stock as seen with this chart on ARNA.
I get up at 6am to get ready for work so I cut on Squawk Box and listen to what the early morning market chatter is. I get to my computer about 6:30 and there is usually some activity on my watchlist. I'll look to see what is going on with those and sometimes I can immediately eliminate one or two from my list. I'll take a quick look at the MarketView on Equityfeed. This gives me info on all of the stocks that are moving in premarket. I won't do much between 6:30 and 7 other than try to get a feel for how the market is setting up like which sectors are hot and which are not. My major preparation will come once I get to work.
I will reference EquityFeed a lot in this blog but the best way to understand the power this tool has and how you can use it is go to the website. Just click on the name throughout this blog and watch the videos on the web site. What I can tell you will not do it justice. I am sharing how I use it now and as I move forward in my trading career I will be taking more advantage of it's features and integrating them into my trading strategies.
I will reference EquityFeed a lot in this blog but the best way to understand the power this tool has and how you can use it is go to the website. Just click on the name throughout this blog and watch the videos on the web site. What I can tell you will not do it justice. I am sharing how I use it now and as I move forward in my trading career I will be taking more advantage of it's features and integrating them into my trading strategies.
Once I'm at work I pull up my TOS platform, my Tweetdeck, and Equityfeed. I glance at my Twitter feed but during the trading day I try to filter out as much noise as I can. I have my MarketView set to where I have the largest % movers on top. I also have a filter that only will allow stocks between $2 and $20, that have traded at least 100000 shares, and with over 25 transactions. This will eliminate any fluke trades that have no relevance. I am only interested in tickers that have gapped up at least 5% from the previous close. I will vet them the way I do my scans at night. I only keep the ones I feel will give me the best chance. At this time I give all of my watches a final look and pick the best 8, my top 8 at 8. Usually I'm done by 8:30. Waiting until 9 is better but my students start coming in at 8:30. This is how the MarketView looks
I also have a specialized filter that I built utilizing Filter Builder in Equityfeed. This is what I have running after 8:30 to only deliver stocks that meet my criteria for potential trades. The parameters for this filter are: last price >=2, last price <=20, today's trades >=100, today's volume >=100,000, % change >=3%, markets NASDAQ, NYSE, AMEX. This filter will run all day but I mainly use it for my morning trades. This is an example of how it looks. on a typical morning.
I also have a specialized filter that I built utilizing Filter Builder in Equityfeed. This is what I have running after 8:30 to only deliver stocks that meet my criteria for potential trades. The parameters for this filter are: last price >=2, last price <=20, today's trades >=100, today's volume >=100,000, % change >=3%, markets NASDAQ, NYSE, AMEX. This filter will run all day but I mainly use it for my morning trades. This is an example of how it looks. on a typical morning.
After I vet the tickers I'll plug them in my TOS platform. I have an 8 chart montage that I put them in at home but at school my monitor is 1/2 the size so I have 2, 4-chart montages. The charts are set for 5 minute candles. My main trading screen has 2 charts with Level 2 and Time and Sales for each. Once a ticker is in play and ready to trade, it will put it on my main trading screen and the charts are set for 1 minute candles.
After the first three 5 minute candles I will draw a green trend line across to show the high and a red trend line to show the low of the first 15 minutes. Then I switch to one minute candles and the two stocks that are closest to crossing the green trend line will go on my main screen. Sometimes I have an immediate trade. If I do not and it looks like I have a couple of minutes I will start building alerts in Equityfeed to let me know when a possible trade is near. I try to set alerts slightly ahead of a breakout point so that I have enough time to wrap up what I'm doing and get to my computer. I have a 15 minute break that starts at 9:45 so it works out perfectly. If I am in an immediate trade then my break miraculously extends to 20 or 30 minutes! Now when I start shorting stocks I will use the red trend line to tell me when I need to short it. And there are times when the stock will trade within those lines all day and offer no setup.
Now there are opportunities when I get the morning break to trade and then the stock will start setting up for an ABCD type move for later in the day. It is not uncommon for me to trade the same stock twice in one day. If after 1pm all of my potential trades have dried up, I will use the Trade Alerts feature on EquityFeed to look for stocks hitting the HOD or making 52 wk highs so I just check day high box and the 52 week high box. Everything else I leave blank. For the filter settings I look for stocks priced between $2 and $20 and a volume over 1 million. As the tickers come up I just click on them and a chart pops up and I can quickly identify if the chart looks like the ABCD patterns I like to trade.
There are many potential trades everyday. The only reason I would miss making a trade would be because of my schedule at work that day. Everything I trade right now follows either the simple gap pattern or the simple ABCD pattern. The hard part is trusting what I see and clicking that button. Not everything works perfectly nor do I trade everything perfectly but the potential for me to make a few thousand dollars a day is definitely there once I get more experience.
One thing I can tell you is that having a tool like EquityFeed is a necessity if you want to control your own destiny. You do not want to depend on someone telling you to buy and sell this or that. You need to know what you are doing and why. I have had a slow start to 2015 trying to do 2 things at once but once I get my rhythm back at work I know I will be back on top of my game, well back to making progress toward reaching the top.
Well, until next time, happy trading!
After the first three 5 minute candles I will draw a green trend line across to show the high and a red trend line to show the low of the first 15 minutes. Then I switch to one minute candles and the two stocks that are closest to crossing the green trend line will go on my main screen. Sometimes I have an immediate trade. If I do not and it looks like I have a couple of minutes I will start building alerts in Equityfeed to let me know when a possible trade is near. I try to set alerts slightly ahead of a breakout point so that I have enough time to wrap up what I'm doing and get to my computer. I have a 15 minute break that starts at 9:45 so it works out perfectly. If I am in an immediate trade then my break miraculously extends to 20 or 30 minutes! Now when I start shorting stocks I will use the red trend line to tell me when I need to short it. And there are times when the stock will trade within those lines all day and offer no setup.
Now there are opportunities when I get the morning break to trade and then the stock will start setting up for an ABCD type move for later in the day. It is not uncommon for me to trade the same stock twice in one day. If after 1pm all of my potential trades have dried up, I will use the Trade Alerts feature on EquityFeed to look for stocks hitting the HOD or making 52 wk highs so I just check day high box and the 52 week high box. Everything else I leave blank. For the filter settings I look for stocks priced between $2 and $20 and a volume over 1 million. As the tickers come up I just click on them and a chart pops up and I can quickly identify if the chart looks like the ABCD patterns I like to trade.
There are many potential trades everyday. The only reason I would miss making a trade would be because of my schedule at work that day. Everything I trade right now follows either the simple gap pattern or the simple ABCD pattern. The hard part is trusting what I see and clicking that button. Not everything works perfectly nor do I trade everything perfectly but the potential for me to make a few thousand dollars a day is definitely there once I get more experience.
One thing I can tell you is that having a tool like EquityFeed is a necessity if you want to control your own destiny. You do not want to depend on someone telling you to buy and sell this or that. You need to know what you are doing and why. I have had a slow start to 2015 trying to do 2 things at once but once I get my rhythm back at work I know I will be back on top of my game, well back to making progress toward reaching the top.
Well, until next time, happy trading!
Tuesday, January 6, 2015
How I Find Stocks to Trade: Part I
How I Find Stocks to Trade
There are
literally thousands of stocks that you can trade on any given day. When you are new, the potential number of
trades can and will overwhelm you. I
know when I first started I just traded what was on the guru’s watchlist that
was put out every day. My only plan was
to rely on these guys I paid money to for stocks to trade as well as alert
services (pumpers) I subscribed to. I
would buy on the alert, hold for a while and sell for a profit. Yeah, that worked really well. I lost over ½ my trading capital in a
month. I did not know how to do basic
technical analysis or read candlesticks.
I spent months not gaining the knowledge I needed. I realized that for me to be successful, I
needed to become self-sufficient. I
needed to spend time learning how to find stocks to trade as well as what to
look for when I find them. My idea of looking
for a simple list of high volume momentum stocks that I can trade every day and
make boat loads of money wasn’t reality.
Scanning for stocks is a huge fundamental skill that you must develop as trader, even if you are someone who gets most of their ideas from others while sitting in a chat room. You never want to be in a situation where you must rely on others to give you what you need to survive in this business. Having the foundation to be able to scan for yourself actually helps you to better be able to analyze the stocks mentioned every day in chat rooms by others, especially since not all of them are going to be setups that you like or are familiar with. If you can't scan through stocks on multiple time frames quickly and efficiently, you are going to be left in the dust by traders who can react quickly and efficiently to what they see since they have so much experience at it. Finding the best stocks to day trade requires preparation, having the correct tools, and a basic understanding of technical analysis. I use a two part system to find the stocks I trade so I will be sharing part 1 in this blog.
For me it begins with the nightly scan. I not only use this to help build my watchlist but I use it to get an idea of what happened in the market that day such as if a particular sector is gaining momentum. Even though only 1/4th of the stocks on my watchlist actually ever set up for me as a possible trade, it helps me organize my thoughts and gives me much needed practice in reading charts and formulating plans. I need this structure as being a full time teacher my time to research and chart intraday is very limited. I have to start preparing at night. I will eat dinner, have a little family time, take a shower to shake the day off, and start my scans.
Scanning for stocks is a huge fundamental skill that you must develop as trader, even if you are someone who gets most of their ideas from others while sitting in a chat room. You never want to be in a situation where you must rely on others to give you what you need to survive in this business. Having the foundation to be able to scan for yourself actually helps you to better be able to analyze the stocks mentioned every day in chat rooms by others, especially since not all of them are going to be setups that you like or are familiar with. If you can't scan through stocks on multiple time frames quickly and efficiently, you are going to be left in the dust by traders who can react quickly and efficiently to what they see since they have so much experience at it. Finding the best stocks to day trade requires preparation, having the correct tools, and a basic understanding of technical analysis. I use a two part system to find the stocks I trade so I will be sharing part 1 in this blog.
For me it begins with the nightly scan. I not only use this to help build my watchlist but I use it to get an idea of what happened in the market that day such as if a particular sector is gaining momentum. Even though only 1/4th of the stocks on my watchlist actually ever set up for me as a possible trade, it helps me organize my thoughts and gives me much needed practice in reading charts and formulating plans. I need this structure as being a full time teacher my time to research and chart intraday is very limited. I have to start preparing at night. I will eat dinner, have a little family time, take a shower to shake the day off, and start my scans.
I use Finviz
for my nightly scans. It is free, it has
a great selection of technical indicators, and it provides a daily chart and
some basic fundamental information. I
have two simple scans that I took straight from the Textbook Trading and TandemTrader DVD’s. I start with Scan 1, and
if there are more than 40 tickers, I’ll run Scan 2 to cut down the list. You can click on them to see what they look
like. Also, I change the charts to candlesticks to take those distracting trend lines off! From there I will begin looking on
the daily charts to see if any of them have the potential to set up for a trade
the next day. Along with looking for stocks which have immediate setups that are looking like they will breakout, I will be looking for charts which show me that they can have nice moves with good range again and again.What I look for comes
directly from the DVD’s. I look for charts that may be gearing and setting up for an ABCD type move, one that can set up for an anticipated R/G (red to green) move, a weak open and
then stabilize for a move upward, or a potential morning washout after a
bullish or bearish close. Here are some
examples of what I am looking for:
In PVG I am looking at how it has run up and broke through the prior resistance. I am interested because It can make a push to 7+. I am interested in SGMS because it is a potential ABCD setup. If you match it to the intraday chart it was forming an ABCD pattern as well.
Once I run the scans and pick out the charts I like, I will add them to my watchlist in TOS and pull up multiple time-frame charts to see how they compare to one another. This is an example of SGMS. I like this stock for a potential trade the next day because on all 3 charts it is close to breaking a key resistance level and half dollar mark and will most likely run to and possibly break the next whole dollar.
I still look
at other watchlists from gurus but only to see if they came up with some of the
same stocks I came up with. I always
have 2 plans for a possible trade. If it
sets up the way I want it to one way or the other, or fits one of the patterns I like, I trade it. If not, I dump it and move on.
A stock will either open red or green, with strength or weakness. I always wait at least 15 minutes before I make any trade. To make sure I wait I set all of my charts on 5 minute candles for the first 15 minutes to give me a clearer picture of what the stock wants to do. Then I'll switch to 1 minute charts and choose my trades accordingly. I do this because I am trading at work and I cannot allow myself to jump in a trade because I do not have time to watch every tick. After 15 minutes I can usually tell whether I will trade a stock or not. Sometimes I am wrong because stocks are often manipulated by market makers, but more often than not, I am right.
My goal this year is to start with making $250 a day and as my account keeps growing I'll raise it. If I only average $250 a day I'll make $65,000 for the year which is what I make at my job. Since I am starting with $5000 this year my position sizes will not be as high as they have been. I will have to scale them up as my account grows. I will not use leverage like I did last year. I fully expect to be between a $400 - $500 a day average by the end of the year, especially since I have 3 months in the summer to trade full time. I look at it this way, a 1000 share position with just a .25 move is $250. or 3 .10 moves is $300. The only thing that can stop me from hitting that mark daily would be my responsibilities at my job.
In my next post I will talk about how I modify my watchlist in the morning and how I locate possible intraday trades using Equityfeed once I have exhausted all of the tickers on my morning watchlist. Also, in the mornings I scan for my favorite intraday set-ups, the gappers. These setups will be even more profitable to me once I start shorting. Until next time, happy trading!
A stock will either open red or green, with strength or weakness. I always wait at least 15 minutes before I make any trade. To make sure I wait I set all of my charts on 5 minute candles for the first 15 minutes to give me a clearer picture of what the stock wants to do. Then I'll switch to 1 minute charts and choose my trades accordingly. I do this because I am trading at work and I cannot allow myself to jump in a trade because I do not have time to watch every tick. After 15 minutes I can usually tell whether I will trade a stock or not. Sometimes I am wrong because stocks are often manipulated by market makers, but more often than not, I am right.
My goal this year is to start with making $250 a day and as my account keeps growing I'll raise it. If I only average $250 a day I'll make $65,000 for the year which is what I make at my job. Since I am starting with $5000 this year my position sizes will not be as high as they have been. I will have to scale them up as my account grows. I will not use leverage like I did last year. I fully expect to be between a $400 - $500 a day average by the end of the year, especially since I have 3 months in the summer to trade full time. I look at it this way, a 1000 share position with just a .25 move is $250. or 3 .10 moves is $300. The only thing that can stop me from hitting that mark daily would be my responsibilities at my job.
In my next post I will talk about how I modify my watchlist in the morning and how I locate possible intraday trades using Equityfeed once I have exhausted all of the tickers on my morning watchlist. Also, in the mornings I scan for my favorite intraday set-ups, the gappers. These setups will be even more profitable to me once I start shorting. Until next time, happy trading!
Monday, January 5, 2015
Trading Psychology I
Avoid Analysis Paralysis
Most traders
start out soaking up information. This
information will come in the form of stock picks, books, seminars, trading
coaches, gurus, you name it. Your
personal beliefs, background and personality traits will then take that
information and digest it into what I call your foundation for trading.
Next you
will take this newly found information into the world of the market. This can be exciting and a bit scary at the
same time. If you are lucky you will put on a few trades and things will go
smoothly. The money will just flow. If you are unlucky, you will quickly realize
why 90%+ of traders fail within the first few years of taking up the charge.
No matter
how you start out you inevitably will face a loss that will hit you in the
gut. This loss will resemble the first
time a girl broke your hear, or the disbelief you had when you heard at school
that Santa didn't exist after your parents have been helping you draft your
Christmas wish list and leaving out cookies for years. You will
feel a sense of utter disparity as your trading world unravels much quicker
than the time you have spent to build it up.
This is the
phase where most traders will spend their entire careers. In any business analysis of the company’s
performance to drive further growth is paramount. Trading is no different. The only problem is you have to decipher when
it’s time to tweak your model versus when results are just noise from the
market.
Think about
it, if you have just spent hours, weeks or months researching a strategy. This
strategy on all fronts looks like it will give you an edge over the market let’s
say 60% of the time. In addition to this
edge, it also provides you 2-to-1 in terms of the size of winners and
losers. By all accounts this would be
considered a strategy worth testing in the real world.
Of course
since the market is random, let’s say out of your first 6 trades only 1
works. The experienced trader will know
that it’s a matter of placing a large enough sample set of trades for things to
net out. The novice trader or the trader
stuck in the analysis paralysis phase will without a doubt, change this strategy before it has time to prove whether it is viable or not.
As I’m
writing this, it sounds so obvious that you have to allow time and opportunity
to work in your favor. But when it’s
your hard earned money on the line your first reaction is to analyze and correct. It’s such a normal human reaction to protect
oneself. Yet this type of behavior is
what traps us as traders and never allows us to reach our full potential.
Do not get stuck in analysis paralysis! Give yourself enough time in the simulator to fully develop your strategy so that when you bring it to market, you have absolute trust and confidence in it. Then, as the market goes through it's cycles, you will just simply adapt and not trash your strategy and start following whoever is posting winning trades.
Do not get stuck in analysis paralysis! Give yourself enough time in the simulator to fully develop your strategy so that when you bring it to market, you have absolute trust and confidence in it. Then, as the market goes through it's cycles, you will just simply adapt and not trash your strategy and start following whoever is posting winning trades.
Saturday, January 3, 2015
How I Started Trading: Part II/Choosing the Right Tools
How I Started Trading: Part II
Choosing the Right Tools
Another thing I found out is to be successful in trading,
you must have the right tools. Finding the
right tools can be confusing at times and some may be very expensive. However, if you have followed my advice from
the previous blog, you have chosen a “guru” to follow and learn from. I would absolutely take their advice when it
comes to the tools you will need when trading.
If they have a DVD there is usually a chapter on this subject or they
will have a section on their web site dedicated to the tools they use. But, for the sake of this blog, I will share
what tooIs I use and how I use them.
First, I will talk about brokers. I think choosing the right broker can make or
break you when you first start making actual trades. The first accounts I opened were a USAA, a TDAmeritrade and an E-Trade account. I
opened the latter of these because they offered free trading platforms and free
initial trades. USAA does not have a
platform. I opened it because I am a
USAA member. E-Trade’s platform is only
free for the first few months unless you make so many trades within a quarter. Then you get it for free. Also, you have 60
days to actually fund the account while still having access to the
platform. I opened up multiple accounts
so that I could avoid the PDT rule. TD Ameritrade had a paper trading option
but unfortunately I never took advantage of it.
For a newbie it was difficult keeping up with 3 accounts so I found
myself trying to come up with something better.
Also, I needed to come up with the $600 to keep my E-Trade account open
but by then I had lost most of the $1500I started with.
When I started following Tim Sykes, I was directed to
Suretrader since I had such a small account.
I was warned that they were experiencing growing pains and that the
customer service was terrible. I also
had fears because they were outside of the US.
But, they didn’t enforce the PDT rule since they were off shore and they
catered to (preyed on) traders like me.
I only sent $500, which was about all I had left, at first and
eventually got comfortable with them. I
remember they gave me a couple hundred dollars rebate since I signed up through
Tim so I ended up with a little over $800 to start with. They have been my exclusive broker this
year. Their customer service has been a
lot better. I think they need to reduce
some of their fees though. I use TOS
platform to watch my charts and watchlists during the day because it offered
everything I needed for free and I was very comfortable with how it worked. I do plan on using my TD Ameritrade account
to do some swing trades this coming year.
Next I’ll talk about what I use as my primary screener.
Finviz is by far the best screener that I have found. And better yet, it’s
free. With Finviz you not only get the
scans but you also get a corresponding chart and info like the short float and
volume to go with each ticker. This cuts down tremendously on the amount of time
I spend vetting tickers for my watchlist. Before I started using Finviz I would
use my scanner to find tickers and then I would have to put each ticker into my
charts at TOS to get a look at the chart. With Finviz my scans are now
completed in about 1/2 the time because I only vet the ones that pass my Finviz
daily chart test. Once I have my watchlist narrowed down to about 10 to
12 tickers, then I use TOS Trade tab that has 3 multiple timeframe charts so
that I can see how the ticker lines up over multiple timeframes and pick the
best 3 or 4. I’ll have more on how I do
my scans in a later post.
I also use Equityfeed. This is a paid subscription service
but I really can’t make it without it. This
is a very powerful tool and I haven't begun to familiarize myself with all it
offers. I needed a tool that would give me real time information 1st thing in
the morning and real-time intra-day scanning to help me identify any setups
that may come up later in the day. Since
I am a teacher and can’t watch my screen all day this tool is invaluable to
me. I can usually pay for the subscription
with just 1 trade this tool helps me find.
I will explain in more detail how I use this tool in my Screener and
Scan blog.
Before I started using Equityfeed I used Stock Horizon to
help with intraday stock picks but they would send short and long alerts and
most of the time it was done by 10 to 10:30.
I would catch one or two here and there but I found myself not trading
my set-ups and I had a nice loss the last time I used it. I’m sticking with Equityfeed because of all
the options it will give me down the road as I perfect my strategy and I like
finding stocks on my own for potential trades. I am not bashing Stock Horizon as it is a good service for those who do not have time to scan for themselves.
As far as chatrooms go, InvestorsUnderground is by far the
best. I have been in 4 to date and they
do not compare to the information and support you get in IU chat. Above all, they are always striving to get
better and provide more. I am only in
chat during my summer break due to my work schedule but I follow what I can on
Twitter. I would recommend that you
watch the Textbook Trading DVD before you start engaging in the chat though
because you definitely need to know what is going on beforehand. Nate personally answers all emails and Tweets
and gives honest spot on advice. If you
want to learn from the best, Nate and his community are the best. The video
lessons, webinars, and DVD’s are unmatched.
As far as videos I would only recommend Textbook Trading and
Tandem Trader. I believe IU will release
a swing trading DVD by Michele aka Offshore Hunter, soon and I’m sure that one
will be just as good. I think all of the
reviews on Investimonials speak for themselves.
One tool that I plan on re-implementing is Profit.ly. I will start verifying my trades again and using their tools to track my progress and analyze my trades. As you can see I have the widget up already on my page with my pathetic newbie trades from earlier this year. All are pre-IU and Textbook Trading.
Lastly, I will share the hardware that I use. I wanted a mobile station so that I could
move throughout the house because sometimes I like looking out over the deck in
my backyard, sometimes I like sitting on my deck, sometimes I like looking out
of the front window, and sometimes I like sitting on my front porch. I wanted to be able to trade anywhere. So I started out finding a desk that was
light, sturdy, and had wheels. I then started
looking at different personal trading setups and saw that most had 3 screens so
I started with three screens plus my laptop.
I quickly found that being a rookie it was too much to watch 3 screens while
you are learning so I condensed it to only 2 screens and my laptop. I can pack my station up in a matter of
minutes and take it anywhere I travel.
Unpacking and setup is just as quick.
I have an ASUS - 15.6" Laptop - Intel Core i7 - 8GB Memory - 1TB
Hard Drive that runs 2 ASUS 24” LED HD Monitors through two j5 create - USB
2.0-to-VGA Display Adapters connected to my laptop with a powered Belkin USB
hub . I haven’t had any issues with this setup and I have been running it for
the last 6 months. I am looking to
upgrade my laptop to a 17” screen only to make things easier to see.
Before
After
This just about covers all of the tools I use to trade
with. I tried to keep things as simple
as possible. I am a firm believer in the
KISS method. When I started trading I
would search for the cheapest and any free tools that I could get my hands on.
I quickly learned that the cheapest or free was not always good and more times
than not, you get what you pay for. As you can see I have a mix of both free
and paid. The tools that I use today are
well worth the money and when used correctly pay for themselves 10 times over.
Ed
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