“Unfortunately I had no mentor. At that juncture I thought that I did not need one because I considered myself a self-educated person. After all these years, I realized I was wrong. I could have saved a lot of time and money if I had someone who could have mentored me.”– Dr. Mircea Dologa
Hello:
Suppose I walk into casino and while playing roulette, bet $15,000 on No.18. Number 18 goes on to win and I go home with $400,000. Obviously that’s a fantastic profit but certainly doesn’t yet mean that I’m a brilliant player or a professor of game theory, both of whom are capable of giving really good advice. This shows that a winning streak doesn’t necessarily portray one as a good trader. Good traders are known by their ability to avoid huge losses and sustain only small drawdowns during losing streaks. One seasoned trader wrote that he personally had a distrust of analysts and strategy salesmen who invariable only pointed out the winners. After all, in this game there are not just winners, as many traders have found out at their peril.
Below is the summary of some of my trading activities this week.
AUDUSD
Primary Trend: Bullish
There has been a serious threat to the long-term bullish bias. While the bearish correction has been halted, the bulls are having a serious difficulty driving up the price. I have a short position on the pair.
Order: Sell
Entry date: May 20, 2011
Entry price: 1.0662
Stop loss: 1.0765
Trailing stop: N/A
Take profit: 1.0065
Exit date: N/A
Exit price: N/A
Status: Open
Profit/loss: -7 pips
NZDUSD
Primary trend: Bullish
There’s also a possibility that the primary trend here may turn bearish if there’s a bearish continuation. The price is trying to move up, but with a very limited momentum. Any weakness in the NZD may trigger further bearish move. Knowing when to enter the market and when to stay out; how to lose small and win big, constitutes a declaration of independence for a skilled trader.
EURCAD
Primary trend: Bullish
On this cross, there are constant threats to the bulls, just like some other instruments. My short position is still open.
Order: Sell
Entry date: May 5, 2011
Entry price: 1.4204
Stop loss: 1.4404
Trailing stop: 1.3908
Take profit: 1.3617
Exit date: N/A
Exit price: N/A
Status: Open
Profit/loss: 361 pips
EURAUD
Primary trend: Bearish
It’ll be very difficult for this cross to move up significantly. Anyone trying to go long on this cross can easily be sliced up, unless the person is going for a short-term trade. My position is still open, though the market is now consolidating. It’s better to remain shorted till the trend is definitely over. Then one would buy in a valley; selling on a crest after a substantial bullish move.
Order: Sell
Entry date: May 5, 2011
Entry price: 1.3795
Stop loss: 1.3995
Trailing stop: 1.3511
Take profit: 1.3202
Exit date: N/A
Exit price: N/A
Status: Open
Profit/loss: 373 pips
EURNZD
Primary trend: Bullish
If the present scenario persists longer, the long-term bias would turn bearish. The price is still quoted below the SMA 20. The ADX 20 level is far below 30 (showing a further decrease in the market volatility). The -DI is still above the +DI, indicating a noticeable bearish pressure in the present equilibrium zone. I have a new position on the cross.
Order: Sell
Entry date: May 17, 2011
Entry price: 1.8130
Stop loss: 1.8256
Trailing stop: N/A
Take profit: 1.7556
Exit date: N/A
Exit price: N/A
Status: Open
Profit/loss: 35 pips
AUDJPY
Primary trend: Bullish
The price is trying to force its way up – something that may present a good opportunity for some to sell. If the JPY gains enormous strength, the downtrend may be so strong. But if the present weakness in the JPY persists, the upward correction may turn into another nice uptrend.
Conclusion: Of course, keeping a trading portfolio permanently safe on a long-term basis can be a challenge, especially for beginners who were wrongly educated by those who presented their trading systems as a Holy Grail, neglecting to emphasize the importance of safe position sizing with risk management. Nevertheless, if a trader has a willing heart to adopt trade management principles that ensure survival in the market, success will usually follow. If you want to develop good qualities that befit a great trader, you’d have to work at it.
When asked how long it took him to be successful, Dr. Mircea Dologa answered with some of the quotes below:
1. “The first net profitable results came after three years of hard labor, but it did come, and the outcome was worthwhile. It’s very important that in order to get quicker results, it is indispensable that a novice trader follows the following learning sequence modules: basics of trading, trading strategies, money and risk management and the psychology of trading”
2. “In order to be successful in trading you need to do one of two things: a) Either, break the learning curve by yourself which takes a lot of time, money and very frequently, the trader will not be able to grasp alone, correctly and methodically, the principles of money management and psychological aspects of trading. Together these aspects make up more than 90% of the act of trading. b) Or do this with the assistance of a mentor, which takes far less time, but your money side would be more visible because you spend it in shorter period of time.”
3. “As for me, in the beginning, I used to go over some topics very fast, believing that they were not relevant to the performance of my trade output. For instance, I tried to short-cut the psychological aspects of trading. I thought that medical schools would have prepared me well enough in this field. But I was wrong. I found out to my own detriment that the psychology of trading is a separate branch of psychology, and that it needs to be seriously studied and understood in a detailed, well applied practical manner.”
Your questions and opinions are highly welcome.
Thank you.
With best regards,
Azeez Mustapha
Forex Signals Strategist, Funds Manager &Coach
Senior Analyst
FX Instructor, LLC
Email: amustapha@fxinstructor.com
Are you facing any challenges in trading? You might want to explore the secrets of markets wizards and duplicate their success. Get the secrets from my past articles at:
www.fxinstructor.com/blog/author/amustapha
Get my Forex trading signals at: http://www.fxinstructor.com/en/analytics/ituglobal
And my past articles are also available at: www.ituglobalforex.blogspot.com
Yahoo! Messenger ID: saazalmu
NB: There is risk of loss in trading, but it is possible to be a successful trader.
No comments:
Post a Comment