“There will come a time when you believe everything is
finished. That will be the beginning.” - Louis L'Amour (Great
American Storyteller)
If you’ve lost up to 50% of
your account, it means you aren’t competent: You ought to stop trading and go
for further training (or why should you receive a margin call?). But some
who’ve had huge drawdown because of gargantuan position sizes would prefer to
treble their sizes and open revenge positions…. As if they’ve not learned their
lessons. Each trader needs to be fully responsible for the outcome of
her/his trading activity.
It’s true that financial instruments afford you unbelievable
chances. Successful traders abound. It’s simply that they know what it takes to
be successful. It’s therefore beneficial to imitate those successes; also
learning from dangerous trading styles that didn’t improve the statistics on your
portfolios. In the end, you’ll be familiar with what it takes to be a permanent
victor. Utter perseverance is the wonderful cure for ignorance. Do you want to
know the trading principles that work? Would you like to be a victorious market
wizard in the foreseeable future? Would you prefer to know trading strategies
that work? Please read the part 4 of the articles in this series.
Traits of
Successful Market Wizards
13. Each position carries the same weight: It does not make sense to think that one trade will be
better than other. You ought to treat every trade of with the same zeal. Every
trade has the same potential. Sometimes, the trade you believe will be a winner
can be a loser; while the trade you feel as worthless could go on to be a
winner. You mayn’t refuse to trade a new setup because the last one produced a
loss. Victorious market wizards can quickly forget about any recent negativity
and open a new position with bravery and zest - just as they did with the
position that went to negative. Cristiano
Ronaldo - a highly successful football striker
- knows that the ability to score more goals comes only when one does not lose
hope after some goals have been missed or thwarted; that’s when one pays
attention on more opportunities to score. Victorious market wizards know how to
pass over closed positions and analyze the markets for new setups.
14. Victorious market wizards focus on the
price: Beginner traders tend to believe
that analyses should be complicated for them to be successful. They put
Andrew’s Pitchfork, Fibonacci levels, Trendlines, Ichimoku Kinko Hyo,
Alligator, Gator Oscillator, Chaikin Oscillator, DeMarker, Fractals, Market Facilitation
Index, Parabolic SAR, Commodity Channel Index and so on, on a single chart.
Putting too many analytical tools on a chart wouldn’t help you in the long run,
because you won’t be able to focus on the price as you’re engrossed in the
analyses of those things. In addition, each indicator has different parameters,
different configuration, and different way of generating signals. Did you want
your charts to look like Michelangelo’s paintings before you can become a
market wizard? Price is the most important thing on the chart. Besides, winning
strategies and analyses should be simple and effective. While you gain more
experience as a trader, you’d start cleaning up your charts and focus on the
price. Successful traders focus on king of the market. Price is the king. No
matter how smart you think you’re, you’ll eventually acknowledge there’s no
empirical or statistical evidence that complicated analyses are batter then
simple ones. You ought to make your career easier for yourself. One again,
price is the king of the financial markets.
15. Victorious market wizards don’t look for
perfect market information: You can be a
winner without having ‘insider’s information.’ You don’t need to know all the
available trading facts about a particular instrument before you can trade victoriously
on it. The possibility exists that you mayn’t be satisfied with the kind of
market information at your disposal. There’s no amount of market information
that can guarantee that you’d always make 100% accurate trades. Victorious
traders acknowledge this truth. They can still make sound trading decisions
even when they know that the information they’ve isn’t flawless. They’re ware
of this, and can still execute trading setups based on the data at their
disposal. Speculation is no picnic: but they remain victorious in the markets.
16. Victorious market wizards don’t trade against the trend:
Gallant traders go short in weak markets and go long in strong markets. Buying
in a weak market and selling in a strong market is a recipe for pecuniary ruin.
Though, I’d say that there are trading methods that help find cheaper prices in
bull markets and dearer prices in bear markets. Counter-trend trading is
vicious if done by neophytes. Don’t buy simply because the market is oversold,
or vice versa. If you’re not comfortable with trading an overextended market,
you might sit on your hands until you get confirmation of the next movement in
the market.
Conclusion: The last article in this series would be made available
next week. No matter which trading approach you use, there’ll be winning
periods and losing periods, yet you can’t become a master trader if you quit. You
can’t afford to fail to work yourself up into success. You just need to
familiarize yourself with dos and don’ts of the financial markets. You’re
invited to have wonderful trading experiences here: www.advfn.com
This article is ended with quotes
from Jessica Peletier, a successful female trader and blogger:
1. “Thankfully, the only vicious, irrational,
stressed out freak you ever have to work with as a trader is yourself.”
2. “I have never met a successful trader that
could quite happily quit and go do something else entirely. For me, trading is
all there is. I cannot imagine a life without trading in some form or another.”
Azeez Mustapha
Market Analyst, Trading Signals Provider and Coach
Copyright (C) ADVFN PLC
For more articles, go to: http://www.advfn.com/newspaper/azeez-mustapha-technical-analysis
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