Pressing Towards Your Trading Goals

THE EFFORT TOWARD SUCCESS IS WORTHWHILE

‘’Goals are like blueprints - it takes work to turn them into reality.”

Hello:

The ultimate goal of the trader is to attain financial freedom through trading. Those who’ve attained this level spend very little time trading, yet they make decently consistent profits. Honestly, most (very) successful traders work more outside trading hours than they do during the actual trading. While it’s true that the road to trading success is actually bumpy, many traders have had their dreams fulfilled. You already know that if they did it, then you can also do it. You don’t have to dread the idea of setting large goals (not gambling); if other traders have reached them, you can too. It’s very much possible for you to be a constantly winning trader.

For you to attain your trading goals, you need to love trading (I love trading like I love my Mom). If you don’t love trading, you’d eventually quit. If you have true love for something or somebody, you wouldn’t abandon that thing/person when things are tough and discouraging. That love would keep you going, and there’ll be victory at last and it’ll become a testimony. But if the true love isn’t there any longer, you know what would happen. Real love isn’t measurable when everything is fine; a good-looking boat would have its durability judged only when it faces the fiercest of storm. If you really love trading, in the times when you mess up along the way you’d do your due diligence to fix your trading problems, no matter what it takes. Some people make commitments to do things and they’re really doing it with one foot in it. They don’t know how much they really need to commit themselves and when the going gets tough, they quit. The problem is that they didn’t love what they were doing in the first place. You got to view the market as your ally, not your adversary.

“New traders may wince at the thought of what it really takes to be a successful trader, but the long-term benefits far outweigh the temporary inconvenience.”

The joy of success makes your trading goals and the steps taken to acquire them worthwhile. The bigger the goal, the greater your feeling of accomplishment upon reaching it. It’s easy to get discouraged if you don’t have anything to focus on or look forward to. But when you set and reach your goals, you feel good about yourself. You shouldn’t beat up yourself if you’re not accomplishing your trading goals perfectly or in the time frame you had in mind. Feeling that way won’t help. Just keep trying! Talk to other traders who’ve already reached the goals you’re still pressing towards. Take them as your mentors. They can inspire you and give you practical suggestions that work. You might also want to share your goals with your family, for they could be part of your support team.

As great as trading goals are, you need a definite plan to reach them. Otherwise they’ll always be goals and never achievement. Here are the steps suggested:

1. Make a list of your trading goals.
2. Set a reasonable time limit for your goals.
3. Plan the steps and actions involved in order to systematically reach your goals.
4. Prepare for daunting challenges.
5. Think of how you can surmount those challenges.
6. Be committed to your goal.

Without definite plans and actions, there cannot be progress in one’s life. This is true of other human activities – not trading alone. Five years ago, someone who was an illiterate school leaver called me to teach him how to read and write (production of illiterate and semi-illiterate graduates is one of the direct results of a corrupt educational system). I gave him my terms and conditions, and we started. But after a short period of time, he quit the literacy studies. Five years later, he called me again, telling me how the illiteracy is affecting his profession. He’d tried other teachers, but without results. I was surprised that his poor academic ability still remains where it was five years ago! Had he followed my recommendations then, he’d have had a measure of progress. Meaningful progress requires serious effort.

Why can’t you start right now? You can begin to take action and start moving towards your journey to financial freedom – and this shouldn’t be done with halfhearted hesitancy or doublehearted hypocrisy. If you work hard, you can reach your goals. While you are on the way, don’t forget to review you trading goals often. Be flexible and adaptable, and always harness the power of your imagination. I wish you the best in your journey towards you dreams.

PS: Please watch out for an important article on Friday. I didn’t post any article last Friday because I wasn’t much around online, and therefore it’d be posted this Friday – a backlog of articles indeed!

Please read the quote below:

“My advice to any burgeoning trader is to form [a] plan, define your edge, know your risk parameters in advance and stick to the rules you have created. The trick to trading has never been about just the wins and the losses, nor the ability to only win big and lose small. The true catalyst for success is to adhere to a balanced routine of analysis, recognition and execution, with as much attention diverted from the pending results as possible.” – Sam Evans

Your questions and opinions are highly welcome.

Thank you.

With best regards,

Azeez Mustapha

Forex Signals Strategist, Funds Manager &Coach

Get my Forex trading signals at: http://www.fxinstructor.com/en/analytics/ituglobal

Nice trading tips are available at: www.ituglobalforex.com

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.

Mid-week Trading Update (November 10, 2010)

“You shouldn’t let anyone discourage you from working towards consistent success on the markets. There are ways of managing risk, making better trades, making more than you lose over a long period of time, and reaching financial freedom.”

Hello:

This is an update on some of the movements on the markets and what I’m doing about them, plus my losses and profits. The analyses are based on daily charts, looking at the Big Picture. My preferred leverage is 1:100 and my position size is 0.01 lots for each $1000. My maximum drawdown in a week is 2% (worst case scenario). I use the Price Behavior rules for strategic decisions and customized indicators for tactical entries. I believe that a ‘buy’ signal that fails is a ‘sell’ signal; and a ‘sell’ signal that fails is a ‘buy’ signal. I open primary positions without predetermined exit target in mind, riding the trend for as long as it continues. The value of patience will forever be emphasized. As long as I stick to my rules and keep my risk low, I’m immune to fear.

Trend following trading is of interest especially to the semi-active trader since entries and exits need to be made less frequent and so they don’t interfere with one’s day job. Trades should be entered with the attitude that ‘every trade is a loser until proven otherwise.’ So if you plan for the contingency of a loss. You should naturally, tend to keep your capital exposure at a minimum. A gambler may acquire unjustified profits. In this case, the unjustified reward may increase a trader's tendency to abandon trading plans in the future because he or she has been rewarded for doing so in the past. But the positive outcomes are usually short-lived, and a lack of discipline ultimately produces trading losses. Yes, anyone might win short term, but it's difficult to continue winning on a steady basis. More consistent winning requires self-discipline. I have no open positions at the moment.

AUDUSD

Primary trend: Bullish

The major trend remains bullish, though it looks like a strong bearish correction is imminent. The present threat to the bullish outlook would either be temporary or sustained. If sellers clearly prevail, then I’d find a good entry point to go short. I’ll never go long at this time.

NZDUSD

Primary trend: Bullish

This pair is in the experience of a reversal, but just like its AUDUSD counterpart, the pullback may be permanent or sustained. If it’s sustained, then I’ll need to find a way of going short. One effective survival method is aborting one’s losers and riding one’s winners; unless you’re trading on short-term basis. Without doing the right things on the markets, there can’t be any lasting success (doing the right things go against our psychology and the way we tend to think). However some marketers wouldn’t tell you this: deceptive marketers are a bane to the Forex world.

EURCAD

Primary trend: Bearish

The bears have come to power on this cross. A sell signal formed on November 18, 2010, and since I preferred to enter at the highest price of the day, I missed the signal. Price might still retrace to 1.4078, and it’ll be a nice entry point for me. This conservative measure is because of my reduction of the initial stop, as you might’ve noticed.

Order: Buy Limit

Entry date: September 9, 2010

Entry price: 1.3100

Initial stop: 1.2950

Current stop: 1.3819

Exit price: 1.3975

Exit date: November 8, 2010

Status: Closed

Profit/loss: 875 pips

Percentage growth: 8.7%

EURAUD

Primary trend: Bearish

My protracted pending order was eventually triggered and the price went the wrong way (what went against me well moved in some other traders’ favor). The market is now in a bearish mode. Immediate resistance and support levels have less significance when the market is in a strong trending mode.

Order: Buy Limit

Entry date: October 1, 2010

Entry price: 1.4000

Initial stop: 1.3850

Current stop: N/A

Exit price: 1.3850

Exit date: November 5, 2010

Status: Closed

Profit/loss: -150 pips

Percentage growth: -1.5%

EURNZD

Primary trend: Bearish

The NZD is still more powerful than the EUR. While it’s true that a weaker NZD might lead to the rise of this instrument, the present trend is bearish. The price is now far below the SMA 20. The ADX 20 level is above 38, suggesting a strong downtrend. +DI is below its –DI counterpart. It might be too late to go short now, since this would give a poor risk-to-reward possibility. The next best option is to wait for a possible rally and find an appropriate time to go long.

AUDJPY

Primary trend: Bullish

This market seems to be ranging at this time, after which it may resume its bullish journey or experience a strong bearish reversal. If the last assumption comes to pass, then I’d want to sell. Then I’d mind my risk control rules. Any trading strategy pales into insignificance if compared to the value of risk management. Risk control often leads to resounding success. But if one ignores this, risking too much, one might find himself kneeling down when things go awry. True, one might find oneself on his knees praying, ‘Please Lord, get me out of this trade and I swear I’ll never trade again.”

Order: Sell Limit

Entry date: October 19, 2010

Entry price: 80.50

Initial stop: 82.00

Current stop: 79.50

Exit price: 79.50

Exit date: November 1, 2010

Status: Closed

Profit/loss: 100 pips

Percentage growth: 1%

Conclusion: Why do most people trade? Obviously, it's for the profits and what the profits can get you. The great irony, however, is that the single-minded pursuit of profits usually doesn't lead to success. It is crucial to focus your energy looking inward. There are absolutely no guarantees in trading, and you’ll never be right all of the time. But if you have an edge that’s utilized correctly, it’ll give you a tremendous advantage over 80% of the traders.

The quote below concludes this article. It’s a food for thought:

“... Don't let your net worth define your self worth. It's tempting to let your account balance dictate what you think of yourself. The winning trader, however, doesn't care about profits. When you focus on profits as a source of self-worth, you start putting contingencies on the value you place on yourself. When you are doing well, you feel good, but when you are doing poorly, you feel inadequate. It's wise to remember that you have value regardless of your account balance. You are a creative, intelligent, and worthy person no matter how much money you have in your account.” – Joe Ross.

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

Get my Forex trading signals at: http://www.fxinstructor.com/en/analytics/ituglobal

Nice trading tips are available at: www.ituglobalforex.com

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.

Martingale and Anti-martingale Trading Systems

“ It is only when a trader is trading with too large a position size that they get margin calls, and if this is a common practice in their trading activities, then I very much doubt they will be around to trade for much longer anyway.” – Sam Evans

Hello:

I’ve observed that 80% of traders are on the right side of the market when they enter a trade; yet overall, 90% of them lose money on the markets. Why? Because no one shows them how to profitably manage what takes place after they get in! That’s why I’ll always say that one’s survival on the markets has nothing with one’s ability to predict the markets accurately. While one may adamantly try to make a prediction by making use of indicators, reading the news or following a neighbor’s tip, one has no control whatever of what’s really happening. The more one tries to predict the markets, the more the markets make one appear like a practical fool. The markets don’t respect one’s education, nationality, race or social standing.

If you make 5% per year or per month, you’re a good trader. Making 5% within any period whatever means you experience losses, but you’re able to recover them. Don’t measure your own trading skill by comparing yourself with other traders, or you’ll end up being haughty or chronically discontented with your trading results, even if you’re surviving the markets. Contentment with small profits makes one survive the markets; discontent with small profits makes one fail.

Martingale And Anti-martingale Trading Systems

In this article, I’d like to briefly discuss the Martingale trading system. Originally, martingale referred to a class of betting strategies popular in 18th century France. Both martingale and anti-martingale are position sizing strategies, which can be used to win trades and/or to maximize profit from trades. Both are high-risk trading strategies, and not at all suited for inexperienced traders and traders with low risk tolerance. Investopedia describes Martingale system as a money management system of investing in which the dollar values of investments continually increase after losses, or the position size increases with lowering portfolio size. This is a very risky method of investing. The main idea behind the Martingale system is that statistically you cannot lose all the time, and therefore you should increase the amount allocated in investments - even if they are declining in value - in anticipation of a future increase. The Martingale system is commonly compared to betting in a casino. When a gambler using this method loses, he or she doubles his or her bet. By repeatedly doubling the bet when he or she loses, the gambler will (in theory) eventually even out with a win. Of course, this is assuming the gambler has an unlimited supply of money to bet with.

The thought is no trader can lose a series of consecutive trades as the market will reverse at any time. By doubling the position size, a winning trade can thus recover previous loses and can yield profit. In a falling market the average entry price for entering trades also falls because of falling stocks, equity or currency prices. Martingale trader must ensure virtually unlimited supply of money so that he/she can remain alive in market till he/she wins. Also there is chance of margin call if trades are done using burrowed money.

Anti-martingale is just opposite to martingale system. Here the trader doubles his position size after every trade he wins. The idea is to maximize the chance of profit in a trending market. Like martingale it is also a risky practice as traders can lose more than the accumulated profit amount by losing only one trade.

Because of recalcitrant fallacy, hordes of traders would continue to be greedy despite trying experiences. Greed comes from the thought that one setup will reap good profits, and so we tend to force a setup where non exits. Fear comes from the feeling of losing profits once a trade has been taken. Any deviation of price from the defined setup creates doubts that this trade could reverse and so there’s a tendency to close out the position too early, for a small profit, only then to watch the price continue moving in the desired direction. Conversely, there’s also a propensity to hang on a losing trade in the hope that it’ll ultimately turn in our favor.

Many Forex traders use high lots and leverages to make significant profits in a short period of time. A trader may want to surprise his girlfriend with sudden wealth. If sudden wealth is what you’re looking for in Forex, you might get it by sheer luck. However, you can never survive in the long run, should you plan to continue trading. You need to desist from trading strategies that encourage high risk or/and don’t emphasize sound risk management. You need to ignore marketers and software vendors who don’t give no-nonsense risk management recommendations. Trading is no joke: it’s real. The roof over your head might well be at stake. Please take survival methods serious.

One more quote from the great Sam Evans ends this article:

“..My first priority in my trading rules is to manage my risk, than worry about the profits. Leverage is a powerful tool when used in disciplined hands, and a dangerous one in reckless hands. Just remember, it is not the market that takes money from the trader. It is the trader who gives their money to the market by not sticking to the rules of disciplined risk management at all times.”

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

Yahoo! Messenger ID: saazalmu

at: http://www.fxinstructor.com/en/analytics/ituglobal

Nice trading tips are available at: www.ituglobalforex.com

And my past articles are also available at: www.ituglobalforex.blogspot.com

NB: There is risk of loss in trading, but it is possible to be a successful trader.

Monthly Trading Signals Summary (October 2010)

“The markets offer unlimited opportunities for self-sabotage, as well as for self-fulfillment.’’ – Joe Ross

Hello:

I was about to post an article containing an interesting topic when I remembered I’d need to post a summary of my long-term trading signals based on my analyses. It’s my intention to post a summary at the end of each month. I don’t get mad because of losses. What’s important to me is gaining more pips than I lose – even if it’s a small percentage per month. A trader with a good trading skill recuperates losses with the factor of time. Remember that my position size is 0.01 lots for each $1000.

1. Instrument: EURAUD

Order: Buy Limit

Entry date: October 1, 2010

Entry price: 1.4000

Initial stop: 1.3850

Current stop: N/A

Exit price: N/A

Exit date: N/A

Status: Open

Profit/loss: 56

Percentage growth: 0.5%

2. Instrument: AUDJPY

Order: Sell Limit

Entry date: October 19, 2010

Entry price: 80.50

Initial stop: 82.00

Current stop: 79.50

Exit price: 79.50

Exit date: November 1, 2010

Status: Closed

Profit/loss: 100 pips

Percentage growth: 1%

3. Instrument: AUDUSD

Order: Sell Limit

Entry date: October 29, 2010

Entry price: 0.9821

Initial stop: 0.9971

Current stop: N/A

Exit price: 0.9971

Exit date: November 2, 2010

Status: Closed

Profit/loss: -150 pips

Percentage growth: -1.5%

4. Instrument: EURCAD

Order: Buy Limit

Entry date: September 9, 2010

Entry price: 1.3100

Initial stop: 1.2950

Current stop: 1.3819

Exit price: N/A

Exit date: N/A

Status: Open

Profit/loss: 1145 pips

Percentage growth: 11.4%

Conclusion: You could see that, on my long-term strategy, I made more money than I lost last month. My near-term signals also have more profits than losses on monthly basis (My near-term trading strategies remain my secret and a secret of my trainees, and of course, a benefit to my subscribers). It’s very important that emphasis be placed on both exit signals and risk management rather than looking for accurate entries (we just need to deal with whatever risk occurs). The opening signal is far less significant than is generally assumed. Oftentimes the markets give signals so clearly that one would need to be blind in order not to see them. Keep in mind that you need to avoid thinking that you’ve to be right always when trading. You can’t impose your wishes on the markets.

There are right ways and wrong ways to trade. Successful trading rules spell out the difference – and aligning yourself to these simple rules will make it possible for you to enjoy consistent survival on the markets. I’d like to help you on your journey to financial freedom. Together, we can stay afloat and ride the wave to success on the turbulent markets. You’re encouraged to subscribe to my one-month free trading signals by going thru the link below:

http://www.fxinstructor.com/en/analytics/ituglobal. You’d be glad you do.

You can also access my past articles that reveal great trading secrets at:

www.fxinstructor.com/blog/author/amustapha

I conclude with Mr. Joe’s quote below:

“How do you approach trades? Do you try to follow a detailed trading plan, or do you rely on luck and hope that all your trades work out the way you want? If you rely on fate, you may pay a psychological price by not developing discipline. Making a quick profit without a trading plan may provide short-term pleasure, but these kinds of winning trades can adversely influence your self-discipline in the long term. Rather than developing a well-defined trading plan, following it, and getting rewarded by trading it, an undisciplined trader puts on a trade haphazardly and is sometimes coincidently rewarded.”

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

Get my Forex trading signals at: http://www.fxinstructor.com/en/analytics/ituglobal

Nice trading tips are available at: www.ituglobalforex.com

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.

Weekly Trading Update (November 4, 2010)

“YOU are the most important factor in your trading success! You create the results you want.” – Dr. Van K. Tharp

Hello:

This is an update on some of the movements on the markets and what I’m doing about them, plus my losses and profits. The analyses are based on daily charts, looking at the Big Picture, though my entries are on a smaller timeframe. My preferred leverage is 1:100 and my position size is 0.01 lots for each $1000. My maximum drawdown in a week is 3% (worst case scenario). I use the Price Behavior rules for strategic decisions and customized indicators for tactical entries. I open primary positions without predetermined exit target in mind, riding the trend for as long as it continues. The value of patience will forever be emphasized. As long as I stick to my rules and keep my risk low, I’m immune to fear.

In spite of the unpredictable nature of the markets, a measure of success can always be managed. Mistakes on the markets are of course, something that preferably shouldn’t happen, but we got to be thankful that risk can be controlled. Yes risk must be controlled, now that false breakouts on the markets are no longer a curiosity; and sustained trend movements are rather rare.

AUDUSD

Primary trend: Bullish

The weakness in the USD is fueling strong bullish runs on the market. There was a temporary bearish reversal on this pair last week. The reversal gave me a failed signal; and the good thing in that is the ability to control a loss. I lost 1.5%. Keep in mind that losses are essentially calculated losses. There may be plenty of them, but they should be within the parameters of the trading plan. Even if there are occasional losses, I’ll always believe in the statistics that says my strategy will recover. What I’ll never take is a big loss. If you sat there and took a big loss, you’d have been badly burnt. You’d be like a whipped dog. You’d have to slink away into a corner and lick your wound.

Order: Sell Limit

Entry date: October 29, 2010

Entry price: 0.9821

Initial stop: 0.9971

Current stop: N/A

Exit price: 0.9971

Exit date: November 2, 2010

Status: Closed

Profit/loss: -150 pips

Percentage growth: -1.5%

NZDUSD

Primary trend: Bullish

There’s a time to be a buyer and a time to be a seller. It’s time to be a buyer on this cross. This pair is still in a strong upward trend, and since you don’t know when a trend will end, you need to wait for a bearish turning point confirmed by other factors. When the NZD eventually weakens against the USD, the fall would be heavy and that’s exactly what I’m still waiting for.

EURCAD

Primary trend: Bullish

The bulls are still strong on this instrument. The trend strength is tantamount to a continuous price movement to one direction or another without any notable pullbacks. I’ll continue riding the trend until my current (adjustable) stop is hit.

Order: Buy Limit

Entry date: September 9, 2010

Entry price: 1.3100

Initial stop: 1.2950

Current stop: 1.3819

Exit price: N/A

Exit date: N/A

Status: Open

Profit/loss: 1145 pips

Percentage growth: 11.4%

EURAUD

Primary trend: Bullish

My protracted pending order was eventually triggered at the price I predetermined on this instrument. I expected the price to continue moving up, since the eventual weakness in the AUD would shoot the cross higher. And if this is true, then resistance upon resistance would be broken.

Order: Buy Limit

Entry date: October 1, 2010

Entry price: 1.4000

Initial stop: 1.3850

Current stop: N/A

Exit price: N/A

Exit date: N/A

Status: Open

Profit/loss: 56

Percentage growth: 0.5%

EURNZD

Primary trend: Bearish

Rather than correlate with its EURAUD counterpart, the extremely strong Kiwi is driving down this cross. However strong, some kinds of support at levels 1.8000 to 1.7800 might push the market up (especially if there’s any sudden weakness in the NZD). The price is now far below the SMA 20. The ADX 20 level is above 30, suggesting a strong downtrend. +DI is below its –DI counterpart. It might be too late to go short now, since this would give a poor risk-to-reward possibility. The next best option is to identify a good support and buy from thence.

AUDJPY

Primary trend: Bullish

The sell trade on this cross hit my adjusted stop, after which the market moved up considerably. The trend has turned bullish and it seems the momentum has just begun. Keeping your exposure on the market small is invariably necessary. If your exposure is too high, you might win a jackpot through gambling. Nonetheless the money made through gambling is soon lost back to the market, or lost to cocaine or prostitutes or any other things. The money from gambling is lost anyway.

Order: Sell Limit

Entry date: October 19, 2010

Entry price: 80.50

Initial stop: 82.00

Current stop: 79.50

Exit price: 79.50

Exit date: November 1, 2010

Status: Closed

Profit/loss: 100 pips

Percentage growth: 1%

Conclusion: Certainly, with today's technology, there is no need to sit in front of your computer all day, all week like I was doing during my novice years. Learn how to properly trade, set and forget your orders into your platform, and go enjoy life and smell the roses. You should be fine as long as your trading system is programmed in such a way that stops in the loss zone will generate a loss that is smaller than the profits generated by the stops in the profit zone. Sadly traders tend to over analyze market data and create false mental images that don’t exist.

A Joes Ross’ quote concludes this article:

‘It would seem that, for most, the only way to the top in trading is to persevere.” – Joe Ross.”

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

Get my Forex trading signals at: http://www.fxinstructor.com/en/analytics/ituglobal

Nice trading tips are available at: www.ituglobalforex.com

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.