HOW TO BALANCE YOUR LIFE AND TRADINGHey! When we all started we passed trough some difficulties in trading.
Usually we face this problems during first year of trading. Most of people by the end of year losing all of money and quit trading forever.
Basically this caused by overtrading and having no idea what to do. Like many business in our lives trading require some abilities and technics which you can study and apply to get good results. But when you are novice trade you probably don't even know where to start.
So on the pic you see basic problems and solutions to start from:
PROBLEMS:
- Worried about trades all day and night
This point distracts from important things and giving huge depression in your live.
- Losses affecting personality and mood
When you starting to losing too much, it often hard to get money back, moreover trying to recoup will give even more loss.
- Mindset confusion
Like every depression in our lives it confuses our abilities to think clear.
- Rushing for new trades
Overtrading is common mistake, causing huge losses from impatient traders/investors.
- Trading assets for all of your money
I f you ever tried trading for 100% of your money — write me a comment!
This problem causing new traders losing too much, and trading become gambling.
SOLUTION:
- Plan your trades
Focus on the future trades, plan your entries, take profits, stop loss. Like every business it should be planned and if something not working you have to fix it and try again.
- Take small trades
In trading Small is BIG, start with small trades, don't give rush, if you will not be rich till the end of year it is okay. But first learn how to trade and make sure you learned from mistakes and wins.
- Focus on affordable risk
Yeah, just 10% from traders have profits every month, rest of traders struggling somewhere in the middle. To make sure you will be in 10% winners, try to understand your risks before opening new trades.
- Use trading system
Trading system is something which suits your personality, you have to try different strategies and technics before understanding your trading criterias. But once trading system is setup, you will be fine and closing months in solid profits.
- Take breaks in trading
Make sure you have some time for other activities, try to plan your trading time and sometimes on the market is nothing to do, so take a breath and relax. Market won't go away :)
👍I appreciate your likes and comments below this post, lets discuss our problems in trading! 💬
Educational
Education: The 90-90-90 rule - Why do traders fail?" Many are called, but few are chosen ". Ever heard this proverb?
This is certainly true for trading, in fact, there is even a rule in trading about this, the 90-90-90 rule. So what does this rule say?
" 90% of traders lose 90% of their money in 90 days "
😱😱😱
That's right, statistics show that 90% of people who start trading lose the majority of their money in less than 3 months. But why is that so? In this post I will try to lay out the reasons for failure, if you are a new or struggling trader, I'm sure you'll find this useful. Let's get into it ...
🤯 EXPECTATIONS
Many start trading because they've seen or read about success stories, people becoming rich overnight, they might even have a friend who has been successful in trading and they think (to say it in Jeremy Clarckson's famous words) " How hard can it be? . With this approach, failure is imminent...
📐 NOT HAVING A PLAN
" If you fail to plan, you are planning to fail - Benjamin Franklin. Trading without a plan results almost certainly in failure. Your trading plan should include the definition of your setup, entry, stop loss, profit taking, trade management, risk management and money management.
🔄 NOT TESTING YOUR PLAN
OK, you have determined how you will trade, what defines your entries and exits, how much of your capital you will risk and how you will manage your trades. But do you know what is the expectancy of that plan? Do you know how much trades you will win on average, and how many you will lose? How much money can you expect to make?
Backtesting your plan, executing it flawlessly time after time on historical data will give you that information and the confidence to execute your plan time and time again without hesitation.
😱 EMOTIONS - THIS IS THE BIG ONE!
If did not take the time to create a trading plan and backtest it, you don't really know what you are doing and emotions will have the best of you.
Fear, greed, hope, excitement, anxiousness, boredom and frustration will drive your hard earned capital away from you.
Results of these emotions are : trading too much, letting your losers run and cutting winners short, revenge trading, overleveraging etc...
I could write an entire post about each of the emotions and how they can affect you while trading, but it would make this post too lengthy. Just know that emotions are your biggest enemy when trading, for best results you should be in a stoic state when trading.
🕺 EGO
" The market can remain irrational longer than you can remain solvent. ". If you want to prove the market that you are right, you are doomed to fail. The market is always right, no matter what happens, so you better learn to accept that your analysis or prediction of what would happen was wrong and cut your losses. Fast!
📚 LACK OF EDUCATION
It takes many years to learn a skill or a profession, trading is no different. If you think about making lots of money without putting the time in to learn and test, you pretty much guarantee yourself to fail.
You wouldn't want a lawyer without education to defend you in court, or a self-proclaimed surgeon who learned on YouTube to operate on you, would you?
💰 STARTING CAPITAL TOO LOW
If you're starting with a low capital, you will tend to try and make it grow fast, resulting in taking too many trades, too high of a risk, too high leverage. If you start with a low capital, you'll have to be OK with the fact that it will grow slowly and that it will take (a lot of) time to build up a sizeable account.
🚦 BUYING OR FOLLOWING SIGNALS
" There is no such thing as easy money. " You might think that you don't have the time to learn about trading, making and backtesting a trading plan. So why not follow signals?
Ask yourself what you know about this service? How profitable is it (and don't just go from the claims they make)? Do you know anything about the reason for a signal, why was it triggered?
Have you talked to other users who used the service, what do they think about it? Why is this person/company selling signals if they are so successful as they claim? Philanthropy ? 🤔
📉 INDICATORS OVERLOAD
Indicators can help you make decisions for trading, but too many indicators can and will lead to opposite signals or " analysis paralysis .
Most indicators are derived from price, so it makes sense to learn how to read price action and discover the story behind the candles.
🆕 THE NEXT SHINY OBJECT SYNDROME
You took the time to develop a trading plan and even tested it, but you run into a drawdown... Rather than counting on your experience and the expectancy that you know is there, you look for a new shiny method of trading, until the same thing happens again with this new method ... Rinse & repeat, never giving the chance for your original method, which you know was working when you tested it, to prove its worth ...
Alright, I think I have provided the main reasons why new or inexperienced traders fail. Knowing why they (or you) fail is one thing, doing something about it is not a small feat. But with enough dedication, persistance and the right mindset, you can prove these statistics wrong!
Feel like reasons are missing, let me know in the comments below.
" Trading is a ruthless business that does not take any hostages, better come prepared. - Nico Muselle
So what is your story?
Are you a successful trader now but recognize these reasons for failure?
Are you a new trader? Was this helpful?
What did/will you do to overcome this?
What did/do you struggle most with?
Help the TradingView community by commenting below.
"Trading is a ruthless business that does not take any hostages, so you better come prepared." - Nico Muselle
Liked this post ? "Smash that like button!" 👍 - follow for more educational posts and alerts 🔔 when a new one is published.
Thank you for your visit! 🙏
Candlestick Reversal Patterns of Technical Analysis !!!👨🏫 In this post, I tried to show you the most important Candlestick Reversal Patterns of Technical Analysis with Entry points & Stop loss points . you can use these patterns for Triggers of your traders at any timeframe ⏰ (These patterns are more valid at higher timeframes).
Please do not forget the ✅ 'like' ✅ button 🙏😊 & Share it with your friends, Thanks, and Trade safe.
What Is A Candlestick ❗️❓
A candlestick is a type of price chart used in technical analysis that displays the high, low, open, and closing prices of a security for a specific period. It originated from Japanese rice merchants and traders to track market prices and
daily momentum for hundreds of years before becoming popularized in the United States. The wide part of the candlestick is called the "real body" and tells investors whether the closing price was higher or lower than the opening price
(black/red if the stock closed lower, white/green if the stock closed higher).
Bullish Pattern 🌅:
🟢 Hammer Pattern : A hammer is a price pattern in candlestick charting that occurs when a security trades significantly lower than its opening, but rallies within the period to close near the opening price. This pattern forms a hammer-shaped candlestick, in which the lower shadow is at least twice the size of the real body. The body of the candlestick represents the difference between the open and closing prices, while the shadow shows the high and low prices for the period.
🟢 Inverted Hammer Pattern : The inverted hammer candlestick pattern (or inverse hammer) is a candlestick that appears on a chart when there is pressure from buyers to push an asset’s price up. It often appears at the bottom of a downtrend, signaling a potential bullish reversal. The inverted hammer pattern gets its name from its shape – it looks like an upside-down hammer. To identify an inverted hammer candle, look out for a long upper wick, a short lower wick, and a small body.
🟢 Bullish Engulfing Pattern : A bullish engulfing pattern is a white candlestick that closes higher than the previous day's opening after opening lower than the previous day's close. It can be identified when a small black candlestick, showing a bearish trend, is followed the next day by a large white candlestick, showing a bullish trend, the body of which completely overlaps or engulfs the body of the previous day’s candlestick. A bullish engulfing pattern may be contrasted with a bearish engulfing pattern.
🟢 Bullish Piercing Line Pattern : A piercing pattern is a two-day, candlestick price pattern that marks a potential short-term reversal from a downward trend to an upward trend. The pattern includes the first day opening near the high and closing near the low with an average or larger-sized trading range. It also includes a gap down after the first day where the second day begins trading, opening near the low and closing near the high. The close should also be a candlestick that covers at least half of the upward length of the previous day's red candlestick body.
🟢 Bullish Harami Pattern : The Bullish Harami candle pattern is a reversal pattern appearing at the bottom of a downtrend. It consists of a bearish candle with a large body, followed by a bullish candle with a small body enclosed within the body of the prior candle. As a sign of changing momentum, the small bullish candle ‘gaps’ up to open near the mid-range of the previous candle. The opposite of the Bullish Harami is the Bearish Harami and is found at the top of an uptrend.
🟢 Morning Star Pattern : A morning star is a visual pattern consisting of three candlesticks that are interpreted as bullish signs by technical analysts. A morning star forms following a downward trend and it indicates the start of an upward climb. It is a sign of a reversal in the previous price trend. Traders watch for the formation of a morning star and then seek confirmation that a reversal is indeed occurring using additional indicators.
🟢 Three White Soldiers Pattern : Three white soldiers is a bullish candlestick pattern that is used to predict the reversal of the current downtrend in a pricing chart. The pattern consists of three consecutive long-bodied candlesticks that open within the previous candle's real body and a close that exceeds the previous candle's high. These candlesticks should not have very long shadows and ideally open within the real body of the preceding candle in the pattern.
Bearish Patterns 🌄:
🔴 Hanging Man Pattern : The hanging man is a type of candlestick pattern. Candlesticks display the high, low, opening, and closing prices for a security for a specific time frame. Candlesticks reflect the impact of investors' emotions on security prices and are used by some technical traders to determine when to enter and exit trades. The term "hanging man" refers to the candle's shape and what the appearance of this pattern infers. The hanging man represents a potential reversal in an uptrend. While selling an asset solely based on a hanging man pattern is a risky proposition, many believe it's a key piece of evidence that market sentiment is beginning to turn. The strength in the uptrend is no longer there.
🔴 Shooting Star Pattern : A shooting star is a bearish candlestick with a long upper shadow, little or no lower shadow, and a small real body near the low of the day. It appears after an uptrend. Said differently, a shooting star is a type of candlestick that forms when a security opens, advances significantly, but then closes the day near the open again. For a candlestick to be considered a shooting star, the formation must appear during a price advance. Also, the distance between the highest price of the day and the opening price must be more than twice as large as the shooting star's body. There should be little to no shadow below the real body.
🔴 Bearish Engulfing Pattern : A bearish engulfing pattern is a technical chart pattern that signals lower prices to come. The pattern consists of an up (white or green) candlestick followed by a large down (black or red) candlestick that eclipses or "engulfs" the smaller up candle. The pattern can be important because it shows sellers have overtaken the buyers and are pushing the price more aggressively down (down candle) than the buyers were able to push it up (up candle).
🔴 Bearish Dark Cloud Cover Pattern : Dark Cloud Cover is a bearish reversal candlestick pattern where a down candle (typically black or red) opens above the close of the prior up candle (typically white or green), and then closes below the midpoint of the up candle. The pattern is significant as it shows a shift in the momentum from the upside to the downside. The pattern is created by an up candle followed by a down candle. Traders look for the price to continue lower on the next (third) candle. This is called confirmation.
🔴 Bearish Harami Pattern : A bearish harami is a two-bar Japanese candlestick pattern that suggests prices may soon reverse to the downside. The pattern consists of a long white candle followed by a small black candle. The opening and closing prices of the second candle must be contained within the body of the first candle. An uptrend precedes the formation of a bearish harami.
🔴 Evening Star Pattern : An evening star is a stock-price chart pattern used by technical analysts to detect when a trend is about to reverse. It is a bearish candlestick pattern consisting of three candles: a large white candlestick, a small-bodied candle, and a red candle. Evening star patterns are associated with the top of a price uptrend, signifying that the uptrend is nearing its end. The opposite of the evening star is the morning star pattern, which is viewed as a bullish indicator.
🔴 Three Black Crows Pattern : Three black crows is a phrase used to describe a bearish candlestick pattern that may predict the reversal of an uptrend. Candlestick charts show the day's opening, high, low, and closing prices for a particular security. For stocks moving higher, the candlestick is white or green. When moving lower, they are black or red. The black crow pattern consists of three consecutive long-bodied candlesticks that have opened within the real body of the previous candle and closed lower than the previous candle. Often, traders use this indicator in conjunction with other technical indicators or chart patterns as confirmation of a reversal.
SPX. The Certainty Trap ‘Never’ &‘always’ have no place in MKTS!Just passing this cool info written by a guy called Ben Carlson.
- Ben discusses the differences between probability and certainty:
"There are two arguments I see on a regular basis that show up as a result of data overload:
…because that’s never happened before.
…because that’s what’s always happened before.
-The problem with this line of thinking is that it can lead investors to fall into what I like to call the certainty trap. It’s this all-or-nothing line of thinking that causes so many to constantly attach extremes to every single market move or data point they see. The beginning of the recovery or the end of the world is always right around the corner. The assumption is that we’re always either at a top or a bottom when most of the time the markets are probably somewhere in the middle."
-The reason the investing certainty trap is so easy to fall for is because historical data can feel so safe and reassuring. Look here, my data says that this has never (always) happened in the past. Surely this trend will continue. I’ll just sit here and wait for my profits to start rolling in.
-‘Never’ and ‘always’ have no place in the markets because no one really knows what’s going to happen next. ‘Most of the time’ is a much more reasonable goal, because nothing works forever and always in the markets. If it did everyone would simply invest that way. I think a much more levelheaded approach is to follow the Jason Zweig 10 word investment philosophy:
-Anything is possible, and the unexpected is inevitable. Proceed accordingly.
Parabolic SARHello, Let us talk about 'Parabolic SAR.'
On this chart: We will read about who developed it, how it works, and how it helps us.
Those who read the book called 'New Concepts in Technical Trading Systems' know that Parabolic SAR was developed by J. Welles Wilder Jr. and published in 1978.
Who is J. Welles Wilder?
He is the creator of several technical indicators that are currently the leading indicators in technical analysis software. These indicators include the Average True Range, the RSI, the Average Directional Index, and the Parabolic SAR.
Let us get to Parabolic SAR:
It stands for Parabolic Stop And Reverse.
In technical analysis of the stock market, Welles Wilder designed Parabolic SAR to find potential changes in the pricing of traded goods such as stocks or currency exchanges such as Forex. It is a trend-track indicator (trend or price tracker) and can be used to determine the break-even point or entry or exit points based on prices that occur during a strong trend in a parabolic curve.
In preceding research based on 17 years worth of data, the parabolic SAR showed a 95% success level.
The indicator appears as a set of points located above or below the price bars in the chart. The point below the price is considered as an uptrend. Conversely, a higher price indicates that bears are in control and likely to remain down. When the points rotate, it indicates that a potential change in price direction occurs. For example, if the points are higher than the price when they go lower, it can increase a higher price. As stock prices rise, make the points, first slowly, then rapidly, and accelerating. SAR starts to move faster as the trend progresses, and the points get priced soon.
When the position of the points moves from one side of the asset price to the other, it produces a parabolic indicator of buy or sell signals. For example, a buy signal occurs when points move from the top to below the price, while a sell signal occurs when points move from the bottom to the top of the price.
The formula of calculation:
Uptrend: PSAR = Prior PSAR + Prior AF (Prior EP - Prior PSAR)
Downtrend: PSAR = Prior PSAR - Prior AF (Prior PSAR - Prior EP)
EP: Extreme Point in a trend
AF: Acceleration Factor (with a default value of 0.02)
How accurate is it?
As we said before, the parabolic SAR showed a 95% success level.
The main advantage of this indicator is that during a strong trend, the indicator indicates that traders should maintain their position.
This indicator also shows the output when there is a move against the trend, which indicates a reverse.
The downside is that it does not provide good trading signals in the side market conditions. The indicator constantly moves up and down the price without a clear trend.
Traders should only trade in the dominant trend direction and avoid trading without a trend. Also, using other indicators such as moving average and parabolic SAR can help prevent such losses.
Suppose you are interested in using this great indicator. In that case, you can go on your TradingView chart and the dashboard, click on 'Indicators & Strategies' and search for Parabolic SAR and find the best one suited for you.
Have you ever used this indicator? What do you think the pros and cons are?
Let us know your ideas.
Good luck.
Two Types of Elliot Wave CorrectionsWhen it comes to Elliot Wave Theory, we know of two different correction patterns .
On the left you can see the classic correction, which is less common in real market situations. On the other hand, the flat correction (right) occurs more frequently in the market, since modern price action is often characterized by fakeouts . In this case, a fakeout looks like a wave B making a new high above wave A. In most cases, traders would open a trade here due to a structural break, which then runs against them (bull or bear trap).
In the following table you can see how the respective correction patterns differ from each other and what you need to pay attention to.
It is very important that you learn how to use Fibonacci tools correctly so that you can calculate the wavelength properly. Maybe I'll do a separate educational post on the proper use of those tools in future.
Thank you very much for your attention,
Your RT
The Investor Mentality: Are You a Worthy Investor?There are two types of people: people who will read through this entire post and put themselves on a life-changing path towards generational wealth by understanding the essence of investing, and people who simply won't read this post. This post may be lengthy and abstract, but I guarantee you that comprehending the concept of what it means to invest, and how to do so, can change your life forever.
This is not financial advice. This is for educational purposes only.
Capitalism is much simpler than you think. The goal of the game, as the name suggests, is accumulating as much capital as possible. Interestingly enough, there are only three ways to achieve this goal, and if anyone tells you otherwise, they're either lying or they're a crook. The method is simple - you need to own the three means of production: land, labor, and capital.
Land: Only 30% of earth's surface is covered by land. Land, contrary to common belief, is rare in the sense that it's limited. If you own land, you can have factories and houses built on your land, through which you can receive rent. This was also prevalent in the past where aristocrats allowed peasants to farm on their properties, taking a certain percentage of the crops that were harvested without even breaking a sweat.
Labor: When you own labor as a means of production, it essentially means that you run a business. What this implies might not be intuitive, but it simply means that you're paying money to buy someone's time. Time is a resource that is much more important than money. Money is infinite, and can even be printed. As for time, both Jeff Bezos and a freshman at college both get 24 hours a day. The difference between the two, is that Jeff Bezos can pay the freshman and hire him to work on whatever needs to be done. Essentially, Jeff is paying to buy the freshman's time, a limited resource.
Capital: Capital is the magic sauce that allows all of this to happen. You can buy land, buy someone else's time, and even buy companies that do all of the above on your behalf. But, capital is no good if you don't make that capital work for you. You can lend capital to someone who needs it, and receive interest payments. In this case, interest is simply understood if you think about it as the cost of borrowing money. The name of the game is to either make the capital work for you, or convert that capital to other means of production, which then bring you more capital, ultimately creating a virtuous cycle.
When people invest in stocks, oftentimes they get too caught up and focus only on the price action, and forget the fact that buying a stock represents ownership of the company. In other words, if you own 10% of Tesla's shares, you have ownership of 10% of the company whether the company is valued at $800B or $2T. So what do you do when a company that's supposed to be worth $1T, judging by the amount of money it makes (cash flow) and the growth it's showing, drops to $800B? The most logical course of action is to buy more shares. You want to buy more ownership of the company for a cheap price, because you know that the company is going to buy other people's time (labor) and use that to generate more capital for you.
It seems so easy, but there's a reason why most people fail at investing. Our brains are biologically wired to focus on short term consequences, and we fail to look at what's best for us in the long term. Thus, we make dumb mistakes like selling perfectly good assets just because "the price dropped too much".
"A price drop is an opportunity to buy more of a good prospect at cheaper prices." - Peter Lynch
Unfortunately, most people sell when the price drops, because fear, uncertainty, and doubt take over their mind. There is a reason why billionaire hedge fund manager Bill Ackman bought over $1.1B worth of Netflix stocks when the price dropped. He saw no fundamental changes to the company, yet the price dropped due to certain people's irrational decision to sell. And I'm very positive that there's a high chance that Bill will be the last one laughing in the end.
I believe that there are only three reasons for you to sell a perfectly good asset: 1) when the narrative has changed (fundamental change in the asset), 2) when you find a better asset, and 3) when selling is inevitable to save your entire position (ex. selling to pay taxes). Unless there is a clear reason for you to sell that fits into one of these three criteria, selling is probably not the best idea. If you truly understand what it means to invest, and convince yourself on why you should be buying or selling at certain levels, you can, and will become a successful investor. Think big, be optimistic, and have patience.
If you like this educational post, please make sure to like, and follow for more quality content!
If you have any questions or comments, feel free to comment below! :)
Lets talk prop firms❗Its the buzz words and hot topic of the moment! PROP FIRMS
Before I start on this topic I want confirm I am a funded trader. This post isn't to promote this style of trading or prop firms.
I am writing this post for those who may not understand what a prop firm is and to share my own experiences on the route to being a funded trader.
What is a prop firm?
Proprietary trading is where a firm trades for its own financial gain instead of earning commissions for clients.
What is a prop trader?
A prop trader is someone who uses that firms money to trade with and in exchange receives a wage or a percentage of the profits.
Now those two statements above probably ring more true for those who work for financial institutes on trading floors all around the world.
The propriety trading firms I want to talk about are the retail prop firms that usually for a subscription or a challenge fee will allow you as a trader to trade funds provided by them.
Any profits you make on that account you as the trader will receive a share of the profits. Usually 70-80%.
The business model has drawn a lot attention some good and some bad.
So this seems a good starting point to discuss what we know of the business model.
To become a funded trader with these companies you must either pay a subscription or take a challenge.
You rules and conditions of which you have to abide by in order to gain and keep funded accounts.
Subscriptions model
This route to prop funding tends to be a monthly reoccurring payment. You are then given an account to trade with stipulations attached.
For the subscription model the rules on the account tend to be very tight/strict and the fee can be quiet hefty.
Challenge model
This route to funding is where the trader pays an entry fee in to a challenge to prove their trading credentials.
The trade will be set targets to meet over one or two phases in order to secure funding.
The account will have rules and stipulations applied for example 10% overall draw down.
If funding is secured then most companies refund the entry fee and you then as a funded trader earns money of any profits made on your funded account.
So that's the options to becoming a funded trader.
The retail prop firm business model has been criticised because some of these funded accounts are demo accounts once gained.
Some say these companies only make money off failures and that's why even their funded traders who have passed are only ever trading demo accounts.
Some prop firms on completion of challenges give you real accounts. But do we truly know they are real or does it just say real?
A prop firm most definitely makes money from failed challenge attempts as part of it's business model. No one will ever know for real if they copy trade their top funded traders either.
But in my opinion they would be daft not to copy trade consistent performers that take payouts of these firms every month because they exists.
Prop trading pros and cons.
Their is pro and cons to any choice in life and prop trading is no exception.
I'll cover my personal pro and cons to the prop world below.
PROS
-For traders who are consistent and proven but only have small capital available, Prop trading is a good route to potentially larger trading pots.
-Most prop firms have scaling plans
-Prop firm gives trader the opportunity to funding most would never of got if they didn't exists. Most would never get an the opportunity to trade for a big institute. Prop firms bridge that gap.
-Given the amount of firms popping up a consistent trader could soon find themselves with a diverse portfolio of accounts giving some life changing chances and monthly profit opportunity.
-Most prop firms have favourable commissions and spreads with some having no commissions what so ever.
-Reduced personal risk . Worse case scenario for a funded trader is losing the account rather than massive personal losses.
CONS
-Even when funded you have to adhere to rules and terms of the prop firm
-You could spend big money getting traded
-The health of the prop firm you trade for is unknown and one prop firm has already dis-appeared.
-In reality the targets set are gain the funded account is quiet high at 8-10% in 30 calendar days.
-Violation of rules ends in account loss.
Summary
I can only speak of the journey I have taken myself.
For me the pros out weighed the cons when it came to seeking funding via these prop firms and the opportunities they offer.
I personally don't mind paying a fee to enter challenges as you need some emotional attachment to the challenge in order for you to play your best trading game.
If these were free to enter then everyone would just go big and all out to get funded then would do exact same if managing to get funded. That would be sustainable for no one.
That's not what trading is about it's about risk management and emotional control which helps lead to consistent trading results.
For a 100k challenge most prop firms charge between £400-£500 that is still a fair amount of money for anyone and you should be treating it as a serious venture if your not then you are simply gambling.
Funded accounts being a demo account hasn't bothered me. I get paid when I'm in profit and that's all that matters.
Spreading accounts over different prop firms lowers risk and exposure to losing all your funded accounts.
One well known firm has gone and thankfully I wasn't with them but aiming for a few accounts with different firms lowers risk of finding yourself funded one minute then not the next.
Are they a scam? In ever growing market place bad apples will be operating in the sector.
As traders you have to do own research but plenty have been round for a while now with good reviews to boot.
Trading in general is hard and gaining 8-10% in one month to pass then doing 5% the following is no easy feat.
Get a game plan and strategy together, back test and forward test the live out of it and when consistency is there only then is it worth attempting funding challenges.
Love them or hate them prop firms are here and making some noise.
They offer opportunity a plenty but they do come with mystique attached.
You as a trader and an individual have to judge if they are for you or not.
Simple way I looked at the opportunity
1 Funded 200k account
3% profit per month = $6000
80% profit split= $4800
GBP= £3478
Approx equivalent to 57k GBP a year!
Freedom can be closer than you think.
Thanks for taking time to read my idea
Darren.
Make Always Bears And Bulls Your Friends ( Take You From A : Z An Overview of Bull and Bear Markets
The terms are simple but their causes are incredibly complex
In the investing world, the terms "bull" and "bear" are frequently used to refer to market conditions. These terms describe how stock markets are doing in general—that is, whether they are appreciating or depreciating in value. And as an investor, the direction of the market is a major force that has a huge impact on your portfolio. So, it's important to understand how each of these market conditions may impact your investments.
KEY TAKEAWAYS
A bull market is a market that is on the rise and where the economy is sound; while a bear market exists in an economy that is receding, where most stocks are declining in value.
Although some investors can be "bearish," the majority of investors are typically "bullish." The stock market, as a whole, has tended to post positive returns over long time horizons.
A bear market can be more dangerous to invest in, as many equities lose value and prices become volatile.
Since it is hard to time a market bottom, investors may withdraw their money from a bear market and sit on cash until the trend reverses, further sending prices lower.
Bull Market vs. Bear Market
A bull market is a market that is on the rise and where the conditions of the economy are generally favorable. A bear market exists in an economy that is receding and where most stocks are declining in value. Because the financial markets are greatly influenced by investors' attitudes, these terms also denote how investors feel about the market and the ensuing economic trends.
A bull market is typified by a sustained increase in prices . In the case of equity markets, a bull market denotes a rise in the prices of companies' shares. In such times, investors often have faith that the uptrend will continue over the long term. In this scenario, the country's economy is typically strong and employment levels are high.
By contrast, a bear market is one that is in decline. A market is usually not considered a true bear market unless it has fallen 20% or more from recent highs. In a bear market, share prices are continuously dropping.
This results in a downward trend that investors believe will continue this belief, in turn,
Characteristics of Bull and Bear Markets
Although a bull market or a bear market condition is marked by the direction of stock prices, there are some accompanying characteristics that investors should be aware of.
Supply and Demand for Securities
In a bull market, there is strong demand and weak supply for securities. In other words, many investors wish to buy securities but few are willing to sell them. As a result, share prices will rise as investors compete to obtain available equity.
n a bear market, the opposite is true: more people are looking to sell than buy.
The demand is significantly lower than supply and as a result share prices drop
Investor Psychology
Because the market's behavior is impacted and determined by how individuals perceive and react to its behavior, investor psychology and sentiment affect whether the market will rise or fall. Stock market performance and investor psychology are mutually dependent. In a bull market, investors willingly participate in the hope of obtaining a profit.
During a bear market, market sentiment is negative; investors begin to move their money out of equities and into fixed-income securities as they wait for a positive move in the stock market. In sum, the decline in stock market prices shakes investor confidence. This causes investors to keep their money out of the market, which, in turn, causes a general price decline as outflow increases.
Change in Economic Activity
Because the businesses whose stocks are trading on the exchanges are participants in the greater economy, the stock market and the economy are strongly linked.
A bear market is associated with a weak economy. Most businesses are unable to record huge profits because consumers are not spending nearly enough. This decline in profits directly affects the way the market values stocks.
In a bull market, the reverse occurs. People have more money to spend and are willing to spend it. This drives and strengthens the economy.
Gauging Market Changes
The key determinant of whether the market is bull or bear is not just the market's knee-jerk reaction to a particular event, but how it's performing over the long term. Small movements only represent a short-term trend or a market correction. Whether or not there is going to be a bull market or a bear market can only be determined over a longer time period.
However, not all long movements in the market can be characterized as bull or bear. Sometimes a market may go through a period of stagnation as it tries to find direction. In this case, a series of upward and downward movements would actually cancel-out gains and losses resulting in a flat market trend.
Perfectly timing the market is almost impossible.
What to Do in Each Market
In a bull market, the ideal thing for an investor to do is to take advantage of rising prices by buying stocks early in the trend (if possible) and then selling them when they have reached their peak.
During the bull market, any losses should be minor and temporary; an investor can typically actively and confidently invest in more equity with a higher probability of making a return.
In a bear market, however, the chance of losses is greater because prices are continually losing value and the end is often not in sight. Even if you do decide to invest with the hope of an upturn, you are likely to take a loss before any turnaround occurs. Thus, most of the profitability can be found in short selling or safer investments, such as fixed-income securities.
An investor may also turn to defensive stocks, whose performance is only minimally impacted by changing trends in the market. Therefore, defensive stocks are stable in both economic gloom and boom cycles. These are industries such as utilities, which are often owned by the government. They are necessities that people buy regardless of economic conditions.
In addition, investors may benefit from taking a short position in a bear market and profiting from falling prices. There are several ways to achieve this including short selling, buying inverse exchange-traded funds (ETFs), or buying put options.
The Bottom Line
Both bear and bull markets will have a large influence on your investments, so it's a good idea to take some time to determine what the market is doing when making an investment decision. Remember that over the long term, the stock market has always posted a positive return.
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FOREX Trading Tips To Upgrade your level ( Check it out )
The best traders hone their skills through practice and discipline. They also perform self-analysis to see what drives their trades and learn how to keep fear and greed out of the equation. These are the skills any forex trader should practice.
KEY TAKEAWAYS
Trading forex can be a great way to diversify a broader portfolio or to profit from specific FX strategies.
Beginners and experienced forex traders alike must keep in mind that practice, knowledge, and discipline are key to getting and staying ahead.
Here we bring up 9 tips to keep in mind when thinking about trading currencies.
8 Tricks Of The Successful Forex Trader
Define Goals and Trading Style
Before you set out on any journey, it is imperative to have some idea of your destination and how you will get there. Consequently, it is imperative to have clear goals in mind, then ensure your trading method is capable of achieving these goals. Each trading style has a different risk profile, which requires a certain attitude and approach to trade successfully.
For example, if you cannot stomach going to sleep with an open position in the market, then you might consider day trading. On the other hand, if you have funds you think will benefit from the appreciation of a trade over a period of some months, you may be more of a position trader. Just be sure your personality fits the style of trading you undertake. A personality mismatch will lead to stress and certain losses.
The Broker and Trading Platform
Choosing a reputable broker is of paramount importance, and spending time researching the differences between brokers will be very helpful. You must know each broker's policies and how they go about making a market. For example, trading in the over-the-counter market or spot market is different from trading the exchange-driven markets.
Also, make sure your broker's trading platform is suitable for the analysis you want to do. For example, if you like to trade off Fibonacci numbers, be sure the broker's platform can draw Fibonacci lines. A good broker with a poor platform, or a good platform with a poor broker, can be a problem. Make sure you get the best of both.
A Consistent Methodology
Before you enter any market as a trader, you need to know how you will make decisions to execute your trades. You must understand what information you will need to make the appropriate decision on entering or exiting a trade. Some traders choose to monitor the economy's underlying fundamentals and charts to determine the best time to execute the trade. Others use only technical analysis .
Whichever methodology you choose, be consistent and be sure your methodology is adaptive. Your system should keep up with the changing dynamics of a market.
Determine Entry and Exit Points
Many traders get confused by conflicting information that occurs when looking at charts in different timeframes. What shows up as a buying opportunity on a weekly chart could show up as a sell signal on an intraday chart.
Therefore, if you are taking your basic trading direction from a weekly chart and using a daily chart to time entry, be sure to synchronize the two. In other words, if the weekly chart is giving you a buy signal, wait until the daily chart also confirms a buy signal. Keep your timing in sync.
Calculate Your Expectancy
Expectancy is the formula you use to determine how reliable your system is. You should go back in time and measure all your trades that were winners versus losers, then determine how profitable your winning trades were versus how much your losing trades lost.
Take a look at your last ten trades. If you haven't made actual trades yet, go back on your chart to where your system would have indicated that you should enter and exit a trade. Determine if you would have made a profit or a loss. Write these results down.
Although there are a few ways to calculate the percentage profit earned to gauge a successful trading plan, there is no guarantee that you'll earn that amount each day you trade since market conditions can change. However, here's an example of how to calculate expectancy:
Formula for Expectancy
Expectancy = (% Won * Average Win) - (% Loss * Average Loss)
Example of Expectancy
If you made ten trades, six of which were winning trades and four of which were losing trades, your percentage win ratio would be 6/10 or 60%.
If your six trades made $2,400, then your average win would be $400 ($2,400/6).
If your losses were $1,200, then your average loss would be $300 ($1,200/4).
Expectancy = (% Won * Average Win) - (% Loss * Average Loss)
Expectancy: (.60 * $400) - (. 40 * $300) = $120
In other words, on average, a trader could expect to earn $120 per trade.
Risk:Reward Ratio
Before trading, it's important to determine the level of risk that you're comfortable taking on each trade and how much can realistically be earned. A risk-reward ratio helps traders identify whether they have a chance to earn a profit over the long term.
For example, if the potential loss per trade is $200 and the potential profit per trade equals $600, the risk-reward ratio would equal 1:2.
If ten trades were placed and a profit was earned on just four of the ten trades, the total profit would equal $2,400 ($600*4).
As a result, six of the ten trades would've lost money at $200 each, which equals $1,200 in total losses ($200*6).
In other words, a trader would earn a profit on the ten trades, despite being correct only 40% of the time.
Stop-Loss Orders
Risk can be mitigated through stop-loss orders, which exit the position at a specific exchange rate. Stop-loss orders are an essential forex risk management tool since they can help traders cap their risk per trade, preventing significant losses.
Using the example above, imagine the trader had a very wide stop-loss order for each trade, meaning they were willing to risk losing $1,200 per trade but still made $600 per winning trade. One loss could wipe out two winning trades. If the trader experienced a series of losses due to being stopped out from adverse market moves, a far higher and unrealistic winning percentage would be needed to make up for the losses.
Although it's important to have a winning trading strategy on a percentage basis, managing risk and the potential losses are also critical so that they don't wipe out your brokerage account.
Focus and Small Losses
Once you have funded your account, the most important thing to remember is your money is at risk. Therefore, your money should not be needed for regular living expenses. Think of your trading money like vacation money. Once the vacation is over, your money is spent. Have the same attitude toward trading. This will psychologically prepare you to accept small losses, which is key to managing your risk. By focusing on your trades and accepting small losses rather than constantly counting your equity, you will be much more successful.
Positive Feedback Loops
A positive feedback loop is created as a result of a well-executed trade in accordance with your plan. When you plan a trade and execute it well, you form a positive feedback pattern. Success breeds success, which in turn breeds confidence, especially if the trade is profitable. Even if you take a small loss but do so in accordance with a planned trade, then you will be building a positive feedback loop.
Perform Weekend Analysis
On the weekend, when the markets are closed, study weekly charts to look for patterns or news that could affect your trade. Perhaps a pattern is making a double top , and the pundits and the news are suggesting a market reversal. This is a kind of reflexivity where the pattern could be prompting the pundits, who then reinforce the pattern. In the cool light of objectivity, you will make your best plans. Wait for your setups and learn to be patient.
Keep a Printed Record
A printed record is a great learning tool. Print out a chart and list all the reasons for the trade, including the fundamentals that sway your decisions. Mark the chart with your entry and your exit points. Make any relevant comments on the chart, including emotional reasons for taking action. Did you panic? Were you too greedy? Were you full of anxiety? It is only when you can objectify your trades that you will develop the mental control and discipline to execute according to your system instead of your habits or emotions.
The Bottom Line
The steps above will lead you to a structured approach to trading and should help you become a more refined trader. Trading is an art, and the only way to become increasingly proficient is through consistent and disciplined practice.
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My 5 Year Forex Journey so FarIf there is one thing to remember, it's that life is precious.
What may appear to be a setback is really a stepping stone towards
a better tomorrow. That's the one thing that really separates us from the
animals. They are not aware of the the Future. They have instincts built into their
complex physiology. This is also what makes them innocent. But awareness of the future
is a key distinction. If you you observe criminal psychology, criminals are quite impulsive.
They may cut corners to achieve their goals (Short-Sighted) and this lands them in custody of the more civilized and organized
humans. It is in our nature to pursue goals, because this is how we experience positive emotion. Setting goals has turned my life around, please here this, digest it.
I was on a devastating treacherous descent into the underworld. Immature, Impulsive, Addicted, Lost, Disgusted, these words describe a mindset, an attitude.
The underworld, let me tell you, was quite the experience. I feared for my life, and the health of my loved ones. "How?" I asked myself repeatedly.
Is this what I wanted for myself?
This is what I manifested, really?
Dear God. Help my soul.
Help me Take this 1 day at a time
Help me take it 1 minute at a time if that's what is necessary
Help me restore my dignity
Not from Society
Not From Others
Not even from God
I need to believe that I am worth it
I am worthwhile
I am a good person
I am just a man
I am am an imperfect man
I am an Ignorant Man
I am an Incomplete Man
I am a partially Broken Man
I am vulnerable Man
I am a tough man
But most importantly I am an unstoppable man. And to be quite honest, it doesn't matter what you think.
Because I can manifest anything my heart desires.
How to Choose Which Pairs to Trade With - The Ultimate Guide!Everyone always asks when they start out "which pairs should I choose to trade with" as there is a long list of currencies. So let's break it down:
1. The currency market is the most liquid market place in the world, but that's not the case with ALL currencies. In fact, the US Dollar is involved in around 90% of all trades that occur in the market and therefore it's what we call the most "liquid". Liquidity refers to how easy it is to exchange assets into cash or vice versa. For example, the US Dollar has upwards of a trillion dollars a day in volume which translates to an unimaginable number of traders ready to buy or sell at any given price at any given time, so it's very easy to fill a trade at the amount and price you want. For a less liquid market, such as an altcoin in cryptocurrencies, the liquidity is a lot thinner which means it's not as easy to fill a trade at any given price. Trades are filled when your broker matches your buy order to a sell order(s) of equal amount. When the market orders to buy exceed the limit orders to sell at any given price, the broker will quote a higher price to attract sellers. If the market is liquid like the dollar, the price will move up a tick or so, but if the price is illiquid like an altcoin, it can run up several pips which is why crypto fluctuates so much. So what does this mean for me when I choose a currency pair? It means that the more exotic you get in your choice such as the USDZAR vs EURUSD, the more volatility, unpredictable and volatile trading conditions you will get. Since we use leverage in the currency markets, we want very liquid pairs and very predictable, stable market conditions which brings our currency pool to EUR, USD, GBP, JPY, AUD and Gold is good too.
2. You should not be trading every single variation of the currency list provided above. There is 0 point having both EURUSD AND GBPUSD or USDJPY, EURJPY AND GBPJPY on your list because of correlation. Correlation means these currencies will move together because in the real world currencies aren't exchanged in pairs, they are singular. When I want to make an investment in the U.S. or if I go an visit New York, I'm not going to the exchange counter asking can I sell my EURUSD currency... no, I sell my Euros and I buy USD in return. So since we know the USD is responsible for 90% of currency trades, if EURUSD is moving up it's a result of the USD being weak unless the Euro has had a signficant news event. In that case, GBPUSD will also move up with it. If you ever find yourself buying EU and selling GU at the same time, you'll lose that more often than not. The exact same happens with the Yen pairs.
3. AUD, CAD are commodity currencies whereby their value comes from the investment purposes their economies are pegged to. AUD is commodity rich in a lot of things so analysing conditions in the commodity markets will give you an idea of it's strength. CAD is based off oil and when oil is up, CAD will be up. So there's no point having Oil and Gold and all these other commodities open along with USDCAD, XAUUSD and XTIUSD.
Based on the above, we can wittle about 20 different signifcant currency options down to a handful of choices which are as follows
1. EURUSD or GBPUSD
2. USDJPY or EURJPY or GBPJPY
3. EURAUD or GBPAUD or AUDUSD
AND
4. USDCAD or EURCAD or GBPCAD
OR
5. XAUUSD and XTIUSD (oil)
You shouldn't really have more than 4 to 5 pairs that you know inside out being traded at any given time. If you are looking for more opportunities, branch out into indices such as the S&P or maybe BTC, both are correlated.
GOLD - Facts to have a true sense of gold trading 🔥What is gold forex trading?
Gold forex trading is the term used to talk about the ways you can gain exposure to gold via FX markets. Instead of buying and selling the precious metal, or speculating on its price using futures, you can trade it as a dollar-denominated currency pair or via gold-linked pairs.
As historically gold was used as a currency, it’s not surprising that it’s still an internationally recognised part of the forex market. It trades under the currency code XAU.
Trading gold in the forex market can be a great way for currency traders to get exposure to the commodity and diversify their portfolio. Its stability when compared to other assets during global crises means it’s a popular hedge against inflation. Often, the commodity gets a lot of attention around large market-moving events when investors get spooked and rush into the metal as a safe haven.
For example, amid the Covid-19 pandemic, governments and traders started moving money into gold to protect against losses due to inflation.
Can you trade gold on forex markets?
Yes, you can trade gold on forex markets using the XAU/USD currency pair. This is the spot price of gold, which tells you how much 1 troy ounce of gold costs in US dollars. Alternatively, you can get exposure to gold prices by trading other currency pairs that have a correlation with the precious metal – these include the US dollar, Australian dollar, South African Rand and Swiss Franc.
Gold and the US Dollar
Traditionally, the relationship between gold and the US dollar has been an inverse correlation. As investor optimism has increased, money has flowed out of gold and into currencies, while periods of economic concern have created inflows into gold away from higher-risk assets (like FX).
However, it’s important to note that the USD isn’t the only factor involved in gold’s pricing. This means that sometimes the correlation between gold and USD isn’t so straightforward and doesn’t always move 1 for 1. Especially as there have been instances of the US Dollar being considered a safe haven, due to its use as a global reserve currency, which has seen the asset classes move in tandem.
Gold and the Australian Dollar
Gold and the Australian Dollar have an extremely tight relationship due to Australia’s position as the third biggest gold producer in the world. It contributed about $5 billion worth of gold each year.
As such, gold has a positive correlation with AUD/USD. When gold goes up, AUD/USD tends to go up. When gold goes down, AUD/USD tends to go down. In fact, studies found that a 1% increase in the nominal gold price led to a 0.5% appreciation of the AUD/USD nominal exchange rate.
Gold and the South African Rand
The South African Rand is often correlated with Gold as South Africa is a large exporter of gold. So, when the gold price goes up, it’s thought that the price of ZAR will rise too. This was particularly true when the Rand first entered circulation, but the correlation is still present as the precious metal represents about 15% of the country’s total exports.
You could trade this correlation through the USD/ZAR pair, which would in theory have an inverse relationship to the gold price.
Gold and the Swiss Franc
The Swiss franc has traditionally moved in line with gold, given that more than 25% of Switzerland's money is backed by gold reserves. The Swiss Frac is a fairly common proxy for gold. We saw this relationship in full force in early 2020 following geopolitical tensions between the US and Middle East – gold rallied to around $1560 per troy ounce and the franc followed to trade at intraday highs of $1.03.
So, in order to trade gold, you’d be looking at the negative correlation it has with the USD/CHF pair: when gold price goes up, USD/CHF goes down and vice versa.
Gold forex risk factors
There are a few factors you need to consider before you trade gold on forex markets:
Liquidity – the ease to which you can enter positions can fluctuate throughout the day. However, the average daily trading volumes of gold pairs tend to exceed all currency pairs, excluding EUR/USD, GBP/USD, and USD/JPY
Supply and demand – like any market, when demand is up and supply is down, price rises, and if supply increases and demand drops, prices will fall. Half of the global demand for gold is driven by jewellery production, while another 40% comes from investors
Market volatility – as we’ve mentioned, the volatility behind gold’s price is driven by its use as a safe haven. When other higher-risk assets aren’t performing, people move to gold. In contrast, when risk-on assets are strong, gold trading levels fall
How to trade gold in forex
To trade gold in forex, you need to go through a few quick steps:
Open a City Index account or log in to an existing account
Search for a currency pair in our platform
Decide whether to go long or short on the price
Enter your positions, attaching stops and limits as necessary
Monitor and close your trade
Not ready to trade live forex markets? Practise trading gold-linked currencies in a risk-free environment with a demo account.
Can you day trade gold in forex?
It is possible to day trade gold in forex, but it’ll depend on the market conditions at the time because gold is a relatively stable asset most of the time – until there’s a period of economic uncertainty and more volatility.
As XAU/USD tends to trade in a range , reaching previous highs or lows over time, strategies that take advantage of these moves tend to be more popular. By identifying these buy and sell points you can, for example, open a position on gold when it’s trending up and target a known level of resistance as your sell price. Compared to day trading, this is a relatively low-risk strategy and not designed for quick profit but benefits from the more reliable XAU/USD price movement.
Gold forex trading times
Gold forex is a 24 hour market, but peak trading volume is usually found in New York trading hours, which are between 1pm to 10pm (UTC).
Trading gold markets during peak activity will offer higher liquidity and lower volatility, making them good targets for safe-haven positions. Alternatively, trading gold in lower volume hours can mean less liquidity but provides the extra volatility needed to execute shorter-term strategies.
hope best of luck to you guys
The 12 Tasks Of Trading12 tasks of trading which include:
1. Self-analysis to determine if you are in a state of mind to trade
Prior to starting your trading day, it is very important to make sure you are in the correct state of mind to trade. You need to analyse yourself and make sure you are at the best state of mind to avoid mistakes in the markets. You cannot finish fighting with a friend, spouse, or colleague and expect to make great analytical decisions. Therefore, the first and most important step, is always making sure your mind is clear and at its best.
2. Mental rehearsal to avoid mistakes
The second step includes you rehearsing your set of rules and making sure you are going to strictly stick by them. This will allow you to avoid many mistakes in the markets and in your day.
3. Daily focus to lead you towards your goal
It is very important to have goals, but specifically daily goals. You need to determine what your goals are for the day including the pairs you are looking at, the times you will be trading, your risk management, and what you aim at gaining from the markets that day. Once goals are met, it is important to step back and wait until the next day to trade.
4. Developing your own style of a low risk idea.
For students of Opes Trading Group, low risk ideas and strategies are all taught to them during the course. It is important for every trader to develop their own ideas and strategies that are low risk in order to always protect their capital. Capital preservation is the most important rule of forex trading.
5. Stalking the charts starting from high to low time frames
Looking at the charts from the higher to the lower time frames allows you to be able to see the bigger picture before looking right in. if you started looking from the lower time frames, you could have a wrong picture painted for you as to where the price could be heading. You cannot see the bigger picture if you are standing too close to something, it is the same concept on the charts.
6. Action requiring commitment and not thought
Once a trade and an idea has been analized, it is important not to second guess yourself and take the trade. Do not second guess yourself if you believe in yourself and your trades.
7. Monitoring the trade to keep the risk low
Always keep your eyes on your trades. Now that doesn’t necessarily mean you need to be glued to your charts, but check them every once in a while, and at important candle closure to make sure they are still playing out the way you expect them to.
8. Aborting is the trade is not going well
If a trade does not go as planned (and the reality is some won’t), it is important to cut your losses if the trade is clearly not going to recover. There is no reason to hold on to a losing trade if there is no reason for it to recover.
9. Taking profits when the reason for the trade has ended
A take profit is placed for a reason, however sometimes the reasons end before the take profit has been reached, meaning it is very important to close the trade even if it means closing it early. Never become attached to a trade that you chase the take profit only to find yourself back at 0 or even in negative.
10. A daily review to monitor and prevent future mistakes
At the end of every day, all the trades taken should be reviewed. This will allow you to see what you are doing right, and what you are doing wrong. This will give you a good indication for what is needed for future trades.
11. Being grateful for what went well
Something so many people pay no attention to and ignore is gratefulness. Any positive day in the markets, is a great day! Be grateful for all that goes right, no matter how small the profits might be, because 90% of traders lost that day.
12. A periodic review to make sure everything is still working well
Every quarter it is recommended that you review your whole trading system. As the markets change, we need to be able to change and adapt with them, therefore a periodic review will allow you to know if things that are working still are or aren’t.
What To Focus On As A BeginnerFocusing on winning trades is your setback as a beginner
Every individual begins their trading journey with the idea that trading is all about winning trades and making money. Soon after their dreams are shattered when they realise it was not as easy as they had thought it would be. Now as we all know, the road to success to many is long and difficult, and that’s exactly what makes them successful. So why should the road to success in trading be any different? Look at top performing athletes, they trained for years before reaching any kind of success that definitely did not occur overnight. This bring me to my main point where many traders could be failing due to focusing on winning trades rather than the process it takes to become a good trader.
Every trader beginning their journey needs to understand that trading the financial markets is no different than a top performing athlete. In order to achieve success, one needs to develop their skills over years. Instead of focusing on winning every single trade, one should be focusing on the process and the experience they are gaining over this time. Studying your mistakes, your losses, your psychological weaknesses, your analysis, and your understanding of the charts, are far more important at this stage than focusing on winning trades. Look at your trading journey like a student attending university, a student will learn over years different topics, where some will seem worthless at the time, but will however develop their skills in the necessary fields to succeed in the future.
Every beginner should deeply focus on the process. Winning trades are a by-product of a developed successful strategy which also requires a developed individual. The trader needs to be developed in their psychology above all in order to trust their strategy and apply it correctly without deviating from the plan. Take the time to focus on all aspects of your trading, and let the winning trades come as a result of that in the future. Trading is a marathon, not a sprint, always remember that.
Unknown side about Bitcoin ( For Beginner's )
1 Cryptocurrency is volatile
If you are the one who is constantly following the cryptocurrencies then, you will be able to notice how volatile they are. As virtual trading occurs on various cryptocurrency exchanges rather than a central exchange that indeed leads to an increase in the volatility rate. This is one of the cryptocurrency secrets that you must know before entering the crypto market.
2 Digital currencies have no backing fundamentals
Cryptocurrencies are digital currencies that are not backed up by any central banks or governments like normal currencies. This is one of the cryptocurrency secrets that you must know. They don’t even have any tangible fundamental factors with which they can help derive an appropriate valuation too. So, this makes it clear that valuing cryptocurrencies in a traditional sense is more difficult.
3 There are more than thousands of crypto’s
The crypto market has more than 1,300 cryptocurrencies but of all, Bitcoin is the true king of the market. BTC is the first tradable cryptocurrency that has been brought to the market and currently tops the list in the market. This is one of the cryptocurrency secrets that you must know.
4 Blockchain has great value
When we look at the trading of virtual currencies, it is important to know what lies under those cryptocurrencies that can be valuable. Blockchain technology is something that is the infrastructure on which the top cryptocurrencies are founded. Blockchain tech is a digital and decentralized ledger that can record payments and transfer transactions safely and effectively. It is also a top-secret of crypto.
5 Miners have a role to play
As cryptocurrency transactions need to be verified, the blockchain is frequently enlarged to account for new transactions and payments. So, for this reason, the whole job of cryptocurrency miners comes into place. Crypto mining uses high-powered computers to solve complicated mathematical equations on a competitive basis to verify and log transactions. And this is why the graphic-card hardware needs of miners have increased the sales of NVIDIA and Advanced Micro Devices too. This is one of the cryptocurrency secrets that you must know before entering the crypto market.
6 The key is decentralization
The main fact that blockchain is so enticing is that it’s because of decentralization. There is no central hub where the information is stored and there is also no major data center where cybercriminals can attack and gain control over it. Because of this safety, blockchain becomes a great secure technology to make huge transactions too.
7 Blockchain is advantageous
Blockchain is not only decentralized, but also has several advantages such as being quicker than that of traditional banking, and doing transactions without any middleman saving costs too. Additionally, blockchain also offers user control and transparency. This is one of the cryptocurrency secrets that you must know before entering the crypto market.
8 Blockchain is not perfect too
Blockchain technology has its drawbacks, such as it’s a nascent technology that’s still being developed, and it can sometimes lead to slow transaction speed or verification slowdowns that are critical too. There are also issues about integrating this new technology into the fold too.
9 Cryptocurrencies are banned in many parts
Though cryptocurrencies are the hottest topic all over the world, they are also banned in many countries. Some have chosen to outrightly ban the use of, and others as trading of, digital currencies. It is illegal in Bolivia, Bangladesh, Nepal, Kyrgyzstan, Morocco, and Ecuador. And there is a possibility that the list of countries may increase too. This is one of the cryptocurrency secrets that you must know.
10 Not everyone believes in cryptocurrencies
Not everyone around the world goes crazy about cryptocurrencies. So, buying and holding digital currencies may not be suitable for all. Some may also like to go with the traditional currencies themselves. This is one of the cryptocurrency secrets that you must know before entering the crypto market.
How To Succeed In Your TradingFocus on one single trading strategy
One thing that many people try and do is switch between strategies constantly. This is setting you up for failure, and if the concept of probabilities is truly understood, you will comprehend the reasons why a single strategy will work.
Any strategy is not going to have a 100% win rate, so first you should attempt at getting 50% of your trades right. After that mastering a 2:1 Reward to risk ratio is what will make you profitable. Trying to juggle many strategies will have you working tirelessly, but not moving forward in any particular one.
Less trading, more education
Many people have the conception that spending countless hours in front of the screen looking for potential set ups is how it should be, however that is completely wrong in my eyes. I spend minimal time now looking at charts and set ups, I highlight key levels I want to look at, along with alerts, and simply wait for the market to head there. Time spent looking at charts should be simply for education and mastering your strategy through back testing or simply understanding previous data.
Approach the market from a neutral position
Anyone that knows me knows how big I am on trading psychology and how I believe it is the most important aspect of trading.
Emotions in trading can be one of your greatest enemies as it can lead you to failure even after your success. There are scenarios where you can take trades and be in positive which will lead you to feel over confident, happy, and those will ultimately will lead to irrational decisions if you let them. Those emotions will make you believe you are better than the markets, or that you can outsmart them, ultimately leading your successful trade to turn into a failure. The same can happen when you feel the opposite and lack confidence to enter another trade due to a loss, or think have feelings of doubt.
This is why the market needs to be approached by a completely neutral position. Once you understand that for every person on one side of a trade, there is someone on the opposite side, you will begin to understand that the market itself is just a whole bunch of neutral information moving in nobody’s favour.
Write your goals
Affirmations are great and something that has helped me in every aspect of my life and not just trading. It is very important to write down your goals in order to manifest them into reality. All ideas first begin in the mind, and then come into the physical. Your goals need to be solidified, definite, and written down in order for your mind and yourself to know exactly what you are going after.
Every single day, you need to read your goals aloud, envision them in your mind with every bit of detail possible in order to bring them into the physical. In order to achieve a goal you need to arrive at the destination first in your mind.
Relax
There is no need to rush a single thing in your trading journey, and believe me take it from my experience, every time I tried to, I failed. People attend university for years before going out into a career which then takes many years before mastering it, yet people want to master trading in a year.
Patience is required in all aspects of trading, whether it’s on the charts themselves, or with your strategy, or with your learning curve. It all requires patience. If you are going after trading as a serious life career which you aim to remain in, then relaxing and taking your time is the first step. Nothing great comes from rushing it, especially the markets.
Know how to handle your trades
Based on your strategy and the concept of probability there are a number of things needed in order to appropriately handle your trades.
Firstly, don’t touch your stop loss. I cant say this enough, but stop losses are determined as the final barrier before the trade is invalid, and they are determine before entering the trade. If you find yourself moving your stop, ask yourself why. You will find out mostly its out of fear of losing your money, which is one of the 4 fears of trading. Accept your loss and let the trade stop out, you had it there for a reason.
Also, don’t leave trades behind out of fear. If you have a strategy that you have confidently developed, you should understand that the overall should be a greater number of winners than losers, and you should not leave trades behind out of fear, because they can be the ones that perform the best and make up for the losers.
Another thing to have in place is an appropriate strategy for exiting your trades. Many people have trades that are in profit, however due to the lack of knowledge on how to exit their trades, they still end up not profitable. You need to have a system on how to exit your trades appropriately and at what levels. Always remember, the profit running on a trade is not yours until its closed.
Risk management
Yes, I know you have heard it and read it a thousand times already, but you have no idea how important risk management is until the day you master it and recognise it was the single greatest thing holding you back from success.
People can have amazing strategies, the best reward to risk ratios, but with the inappropriate risk management trust me it means absolutely nothing. I have seen people overleverage on a trade simply because it “looked too good” compared to other trades, only for it to be the worst of the bunch.
I have seen people lose tremendous amounts of money and one thing I can promise you is not a single one of these people lost 100 trades in a row at 1% a trade. Every single one of them lost their entire accounts due to ONE trade that they married.
Risk management should be one of your main areas of focus, because believe me if you have mastered it, even with an average strategy you are doing much better than someone with an exceptional strategy with no adequate risk management.
Keep track of your performance
The only way to improve in any aspect of life is to first recognise what needs change and then work on it. It is very important to actually understand your positives and negatives and have them all tracked. A journal is one of the first steps in order to look in the mirror. Being completely honest is the only way a journal will work, and lying is only lying to yourself. If you are after serious improvement you need to appropriately identify all your flaws in order to better them.
You should never feel down or behind, remember trading the markets is one of the biggest psychological challenges one can face, and that is exactly why not everyone is suited for them. Instead see it as a challenge to better yourself and achieve the perfection and discipline you have always desired on and off the charts. Trading the markets will teach you lessons that you will carry with you throughout your entire life and not just on the trading floor.
Common Chart Indicators: Part IIGood time of the day, family! A lot of you were asking for Part II for our popular chart indicators summary and here it is. Hope you y’all find it useful! Last week, we’ve covered Bollinger Bands, Keltner Channels and MACD (link under the post) and what they’re commonly used for. This week we have:
We've been looking at technical indicators that mostly focus on detecting the start of new trends up until now. It is critical to be able to recognize new trends, but it is also critical to be able to recognize when a trend has reached its conclusion. After all, what good is a well-timed entry if you don't depart on time? The parabolic SAR is one signal that can assist us detect when a trend is about to terminate (Stop And Reversal). A parabolic SAR plots dots or points on a chart to predict possible price movement reversals. The Parabolic SAR has the advantage of being quite simple to operate. Basically, it's a BUY indication when the dots are below the candles. It's a SELL indicator when the dots are above the candles. Simple as that. Great for exits.
Another technical indicator that traders use to determine where a trend is likely to terminate is the Stochastic oscillator. The oscillator is based on the following principle: Prices will remain equal to or above the prior closing price during an upswing. Prices will most likely remain equal to or below the prior closing price during a downturn. George Lane invented this basic momentum oscillator in the late 1950s. When the market is overbought or oversold, the Stochastic technical indicator notifies us. The Stochastic is a number that ranges from 0 to 100. The market is overbought when the Stochastic lines are over 80 (the red dotted line in the chart above). When the Stochastic lines fall below 20 (the blue dotted line), the market is likely to be oversold. We purchase when the market is oversold and sell when the market is likely overbought, as a general rule.
The Relative Strength Index, or RSI, is a famous indicator created by J. Welles Wilder, a technical analyst, that helps traders assess the strength of the current market. The RSI is similar to the Stochastic in that it detects overbought and oversold market circumstances. It also has a 0 to 100 scale. Readings of 30 or lower usually imply oversold market conditions and a greater likelihood of price strengthening (going up). An oversold currency pair is interpreted by some traders as a sign that the declining trend is likely to reverse, indicating a buying opportunity. Overbought circumstances and an increased risk of market weakness are indicated by readings of 70 or above (going down). Since a lot of people have RSI as a default indicator on their charts, it’s a very reliable instrument (even though the margin is considerably large).
See you next week for Part III?
Here are few bad traits that burn tradersHello traders,
Everyone of us have went through one or many of these traits listed here. Some of us are still struggling with this. Honestly, trading psychology is less taught in the trading world and this has become one of the contributing factors that causes traders to lose money and give up trading.
These traits, if they are not controlled they can burn accounts and even leave a trader in a lot of debts which will lead to depression.
It is always best to know oneself, list down all the traits that are manifested when in front of the screen and evaluate oneself what might be causing these traits and look for ways to control this.
One can start sweating immediately he starts watching price swings and another can begin increasing the lot sizes after a loss hoping to recover the money lost.
One can begin to be very confident in his new-found strategy that gave him profit 5 times in a row and only go harder the sixth time and loose it all.
Another one sees a 24 year old boy on Instagram driving a Lamborghini that he apparently bought cash from the money he made from Forex in just 6 months and throw 100k in his trading account and risk it all.
One loss after another, until the losses accumulates to thousands of dollars and eventually a trader begins to feel worthless and give up.
It is not only about a strategy, your strategy can be good, if you do not have the right mindset-the mind of a trader, your strategy is useless.
Safeguard your mind by feeding it with health stuffs, learn the proper way of investing, plan for a long term, write down your plans and work according to your plans-never ever deviate from them.
Today, there are so many trading gurus-just how they are flexing about how they are making money from Forex, this tempts you to pull the MT4 trigger, aimlessly, hoping you can be like them.
If you envy them and are making you feel greedy- unfollow them. Hahahaha.
Trading isn't simple, if it were, I bet 90% of retail traders could be millionaires.
Be patient with yourself, set long term goals and be determined to reach those goals slowly.
Above all, continue acquiring knowledge and be humble to admit that no one knows it all. Me and you are a grain of sand on the seashore compared to the giant market.
RSI Indicator & How To Use ItHello everyone, today, we´re gonna talk about an RSI and how to use it.
What is an RSI?
Basically, it´s an indicator that shows if the asset is overpriced or underpriced.
Basic information
RSI is 0-100
if the price is at 0-30, the asset is underpriced and theoretically it should go up.
if the price is at 70-100, the asset is overpriced and theoretically it should go down.
Professional information
You can set an MA based or RSI moves. And this is getting really interesting right now :)
Every time, the MA is touching bottoms or tops of RSI, it will go up or down (touch bottom = go up, touch top = go down.)
It works like an ball and floor. You just drop the ball on the floor and everytime the ball touches the floor, ball will just bounce and go up.
I drew it to the chart (green circles).
Okay guys, seems like we are in the end. Hope this helped you to make greater decisions and take good view at RSI.
Personally, I use RSI a lot and it´s really saving my a$$.
Thank you so much for reading my post, I´ll be really glad if you will hit that like button and follow me, so you can see other tutorials.
Have a nice rest of your day and stay safe.
Tommy.
Bullish Engulfing PatternsThe bullish engulfing pattern is a two-candle reversal pattern. The second candle completely ‘engulfs’ the real body of the first one, without regard to the length of the tail shadows.
This pattern appears in a downtrend and is a combination of one red candle followed by a larger green candle. On the second day of the pattern, the price opens lower than the previous low, yet buying pressure pushes the price up to a higher level than the previous high, culminating in an obvious win for the buyers.
You want to trade crypto? You need to read this! Hello dear traders i hope you were not affected by recent drop.
About a week ago i advised everyone not to trade this market neither short nor long becuse it's too risky for both sides. So what have should we do? I told you stay aside and wait for global trendline breakout.( i tagg that post below).
What to do now? Now we should stay aside as we did. It's so simple and it's easy to do you do nothing UNTIL this trendline is broken. Maybe this is the bottom but we do not buy UNTIL this trendline is broken.
In every drop and every midterm correction we only will be looking for clear GLOBAL PATTERNS like a big falling wedge, a global trendline, a big descending channel which price hits its top many times etc.
So if you have a clear long term pattern trade it if you don't have it stay aside and watch. DO NOT trade local petterns and short term ones because in most of cases they will give you fake results. When people are trading and loosing money and market makers beat them hard you just watch and wait for a clear longterm pattern breakout. This is how you can survive in this choppy market.
If you liked this post push the like button and tell me do you like to know how to exit the market right before a big correction?