TA basic Lesson

Trading is easy but not simple

Psychology

·         Discipline, Patience, Practice

·         Don’t double up a loser

·         Take a break, when losing badly.

·         Stick to money management

·         Learn to trade, takes times

·         Don’t over leverage just because it is there to use

·         Protect capital to stay in game

·         Never add to a losing position3

·         Never move stop limit to take more exposure

·         Cut losses and Let profit run

·         Waiting for the right opportunities – No positions = Position

·         Trade less and be selective per trade

·         Review over trades

·         Don’t surf internet while market open

·         Don’t be gambler

o   Successful Traders

§  Treat trading like a business and have a plan

§  Self-motivated

§  Adaptable to changing conditions

§  Cope with stress

§  Introspective – knowing strengths and weakness

§  Periodically access their trading

o   Unsuccessful traders

§  Undercapitalized

§  Lack Discipline

§  Don’t spend time studying the market

§  Chasing market

§  Can’t see reality of situation

§  Fear of missing out

§  Takes profit quickly and let losses run freely

§  Do not know when to regroup

o   Working Environment

§  Clean and tidy

§  Free from distraction

§  Comfortable

§  Reliable PC and Internet

§  Calm and not anxious or excited

§  Take regular breaks

TOP 25 TRADING RULES:

Trade with the trend

Buy strength and sell weakness

Have a plan for your trade

Predetermine maximum losses in every potential trade

Don’t chase the market

Give a trade time to work

Keep losses small

Do not add to losses

When the reason for the trade no longer there, GET OUT!

Use volume to help you trade

Make sure the Technical confirm the fundamental

Don’t Trade illiquid Market

Take a break when losing big

When trading well, push it a little

Never risk more than 5 percent of your account equity on a trade

Trade your personality

Prices have memory

Trade what you trade best

Monitor yourself

Know the market

Don’t be greedy

Don’t trade scared

Hope is not a trading strategy

Keep it simple

Take a part of the profit to reward.

Common Mistakes:

·         Get angry with the market

·         Never follow the trading plan and starting trading with big position when winning

·         Overtrading:     

o   Trade for the fear of missing out

o   Trade for the sake of trading

o   Trading out of frustration

o   Chasing the market

o   Trade during bad condition

·         Changing trading plan

·         Ignoring trading plan

·         Looking for holy grail

·         Too complicated plan

Focus and Discipline:

·         Have a routine to help you write a game plan

·         Keep and analyze the trading journal

·         Trade with your style

·         Monitor the markets

·         Be consistent

·         Don’t trade over your head

·         Keep your mind clear

·         Keep your emotions at bay

·         Don’t get over confident

·         Think points, pips but not money

·         Imagine and feel the loss before it happens

·         Pictures yourself as professional

·         Learn to say “so what” when facing negativity result

·         Have someone to answer to

·         Don’t be afraid

·         Clean out your closet: Do not end up marrying a stock

·         Don’t blame others for losses

·         Think of it as an expense and not a loss

·         Self-destructive behavior

·         Learn from mistakes

·         Trade and trade (practice)

·         Losses are past

·         Money management is more important than trade selection

·         Treat yourself when profits

·         Preserve precious capital

·         Have a cutoff point

·         Jumping in too soon or getting in too late

·         Do not let big winners turn to losers

·         Use proven strategy