Clash of Clans

It has been years since I played video games.  Then my little nephew tells me of "Clash of Clans" and since it looks like Warcraft, which I played 20 years, I decide to install it... now I'm addicted!

The funny thing is...

Clash of Clans has made me a better trader!

• Clash of Clans is a good addiction to keep me busy and away from trading when I'm bored.
• Clash of Clans lets me evaluate my "trading mind set".  If I make mistakes in the game, I know I'm not fully awake and alert for trading.
• Strategy games challenge your mind and get your wheels turning.  Quasi training your mind.
• Weekends are kept busy playing Clash of Clans to offset trading withdrawal.

Download Clash of Clans here

Join my Clan

Crystal Ball Interface

While most people focus on Signals, Confirmations, Take Profits, and Stop Losses, many overlook the perhaps most important factor...  Precision

My good friend Markus tends to trade like he's got a "Crystal Ball Interface".  That is he has some pretty long term "predictions", "feelings", and "analysis" however he rides the Crystal Ball Rollercoaster when he enters trades.  That is, he makes perhaps the right long term decision but the market takes it turns and valleys in the short term, which leaves his position going from positive to negative, often several times.   That makes for some stressful trading.

Now he is comfortable with that style of trading, and if you are too, and you are successful at it then kudos to you.

My preference is to pick the low hanging fruit (short term market direction) and pick the tougher fruit (long term direction) later, that is I will look for precise entries on lower timeframes, (M1, M5, M15) keeping in mind what the overall long term picture (H1, H4, D1) looks like.   Furthermore I will look for Take Profits using the lower timeframes.   Sure I will make less pips (low hanging fruit) but while you're climbing the ladder to get to the top, I will pick many times over.   That is your trade will go up and down while I'm consistently entering and exiting several times over.

There are far too many Crystal Ball Expert Advisors and Automated Trading Services that in my opinion are attempting to pick the hardest fruit while leaving the low hanging fruit rotting.

So next time you find yourself in a trade that has turned on you, perhaps several times, ask yourself if you would like to pick low hanging fruit or go for the pie in the sky.

Forex is Gambling

Many times when I tell people what I do for money, they respond saying "Isn't that like gambling?"  And I laugh and tell them

Forex is Gambling

IF you don't know what you're doing!

 

You know what else is a gamble?

• Driving a motorbike if you don't know how to drive... without a helmet... in Rush Hour Traffic...
• Taking out a Mortgage when your company is downsizing
• Bench Pressing twice your body weight without a spotter

The thing is, anything in life can be a gamble.  It all boils down to "Risk", understanding the Risk, the Reward, and making educated decisions based on experience and probabilities.

 

Driving a motorbike for the first time without a helmet in rush hour is a bad idea.  The risk is quite high.   What happens when you take motorcycle lessons, ride in the parking lot with a helmet?   Your Risk goes down.  Add hours of riding experience, days and weeks of practice, and now you can ride the main roads, and soon the express way, in rush hour. 

 

Trading Forex comes with its risks like anything else in life.  You're obviously not going to take your entire pay cheque and put it in one trade.   You're going to get lessons from a Pro.  Get some coaching.   Practice, Practice, Practice.  And start out small, just like riding side streets, you make small trades.  Slowly graduating to the big boys club.  Perhaps you'll upgrade your motorbike and get a bigger bike, perhaps you'll get more lessons, or you'll be happy driving a middle of the class bike for the rest of your life, as you are content making small profitable trades consistently. 

 

Anything in life is a gamble, if you let it be a gamble.   So don't let it be a gamble.   Education pays. Many times over.   So do yourself a favor and get a Forex Pro to teach you.  If it's not me, then someone that you can relate with.  

 

 

 

 

 

 

 

 



FOMO

Watching the Shark Tank today Mark Cuban mentioned "FOMO".  The fear of missing out.  If you are a Forex trader, you know where I'm going next...  Fear and Greed.

It has been a while since I've had FOMO.  I'm pretty much at peace now and know there will always be a better trade, another opportunity.  No longer do I jump into trades for the fear of missing out.  I am content knowing I am missing out all the time.

If you haven't conquered FOMO yet then I suggest you look at your trading plan and your routine.   A well informed and prepared trader has to be confident.  If you are not confident then that means your trading skills or mind set isn't there yet.

Confidence Boosters:

• a Clear Big Picture
• Trendline Analysis on ALL timeframes
• studied the Currency Pair for some time
• gauge upcoming financial news impact
• gauge upcoming sessions open and closes and their impact
• a tested and proven entry plan
• a tested and proven confirmation
• an alert or signal system that keeps you connected when away from the charts
• a tested and proven risk reward ratio (TP / SL, Lot Size)
• reasonable lot size that has been gradually increased
• a tested and proven exit plan
• a bank account that can weather several consecutive losses
• ability to monitor your trade remotely

The Britney System

Last night I met with one of my students, Brendan, from Canada. He is visiting Phuket Thailand with his girlfriend Britney.   We caught up on life, traveling, and of course trading.   His trading story is that like many trading stories, all experienced traders really go through it one time or another.  He started out following his system and making good trades but then jumped the gun and traded with a live account, not following his system, and letting fear, greed, and impulses control his trading style.   Trying to catch reversals has been his downfall too.

Now that he is traveling with his girlfriend and she is interested in trading as well, we came up with "The Britney System", that is when he sees a trading opportunity he double checks with her and she says Go or No Go.   Funny thing is that most women, although emotional, are less emotional with money when it comes to trading.   I think I wrote about the "Japanese Housewife" phenomenon before where housewives in Japan with a lot of time on their hands and an entrepreneurial mindset, turned to trading the Forex Market and did quite well because they are able to execute trades and follow a system without emotion interfering.

When it comes to trading and life in general, sometimes the simplest solutions work.  Some might laugh at the idea, and for some it might not work.  I'm pretty certain it will work for Brendan and Britney.

If you're stuck in a rut with your trading or simply want to improve it then sign up for my Forex Trading Audit and we'll put together a trading plan that works.

Know All The Facts

Too many times traders jump the gun and enter a trade, often despite a gut feeling to stay away, only to ride an emotional rollercoaster until finally that stop loss is hit.

Knowing When to enter a trade is important.   Knowing when to stay out separates you from 80% of traders.

There are three things in life...

1. The things you know you know.
2. The things you know you don't know.
3. The things you don't know that you don't know.

The third one will kill your trading account!

The Market is Never Wrong

Fear and Greed are the two emotions that have been a detriment to mankind.   It is written about again and again.  Yet it still exists.  And even if you control it today, it will lurk it's ugly head again perhaps tomorrow, like those pesky ants that just keep on popping up.  Mosquitos that never seem to stop breeding.

Fear and Greed are alive and well and producing spawn time and time again.   All you can do is keep your emotions in check.  Fight the temptation.  Like on a Friday when your Forex Account has a big fat positive balance.  And you have this urge to trade again.  Out of fear that you will miss out.  Out of greed because you want more.  And out of ego because you have been "right" so many times already this week.

Don't do it.   Just stay away.  Once you go negative then Fear will feed on you.   It can mess with your psychology.  Create doubt.  The fear will grow.  Your natural defense mechanism will kick in and you will want to fight the good fight.  You're right. The market is wrong.  Guess what.

The Market is NEVER Wrong!

Do yourself a favor and just sit out some trades.  It's better to be right and watch then to enter and be wrong.   Already in a bad trade?  Be honest with yourself.  Suck it up.  It's better to stop out now then to weather a loss 5 or 10 times of your current loss.   Do your trend analysis.  Analyze just how bad the situation is.  Go to a smaller time frame and look for exit and entry points.  Maybe stop out and reverse your trade.  Or just wait until the next entry point.    Just know that the market is right. You are wrong.  And if you're in the plus that means like the force, "The Market is With You".

 



NO Water Cooler Talk

It's 1:30am and I'm beating myself up because I've done it once again....   I chatted with a good friend who happens to trade Forex too...  and everytime I do it's the same old thing.... 

We compare analysis.... he wants to go long... I see it as a short opportunity and before you know it I'm going long because in the back of my mind I keep hearing my friend tell me to go long and how he's aiming to make a couple hundred pips....      maybe he does... maybe he doesn't...

The thing is...  When you're trading it's somewhat lonely and you feel like sharing what you're doing. Talking about your successes.  Comparing Notes.  You miss that "water cooler talk".

You're better off WITHOUT the water cooler talk!

What I have found time and time again, that sharing trades with other traders is the worst thing to do.   The good traders usually keep to themselves.  The ones that talk a lot are like the empty can that rattles the most.

Don't get me wrong, my friend can make money at the market.  BUT his style is totally different.  I don't like to wait for hours or days for my setup to go in the right direction with a huge draw down. 

The other issue I have is that my friend will always pry on my trades.  "Got any trades open?"  "How many lots?" "Where did you enter?"   I remember visiting him in my home city of Vienna Austria and I happened to be in a bad USDJPY trade.  Analyzing the market however I knew it would just take some time to come around.  So while I was busy exploring the city for a few days all he would do is tell me how far in the minus I am... and that it will come around again.  Gee Thanks!  Despite me telling him not to worry about it and not to update me.....  Painful... 3 days.... I finally closed in the plus and was able to get BOTH monkeys of my back.

You're better off keeping to yourself!

The thing is when it comes to trading you need to just keep to yourself.  Do It Your Way!

Well my rant is over and (hopefully) I have learnt my lesson.

Ultimately it's my fault for letting it come to this.  I should have just put my foot down and not gotten into a trading conversation.  It's best to just put the instant messages on ignore and change the subject, talk about something else, and after the air has cleared tell your trading friends that you trade better on your own, completely focused on trading.

There Are All Types

Today I did something I haven't done in a long time...  I scalped the EURUSD, 11 trades in about 2 hours...  I used the minute chart and went in the direction of the major trend.  EURUSD has been a short for a while.

It's been a few years since I scalped.   I remember when I first started trading it brought me great joy.  There is an argument to say that's the kind of person I am.  Get in, get out. Rest easy.   That's how I like to exercise, that's how I like to shop, and that's how I like to date. hehe

There are all types of Traders...

So the question is, what kind of Trader are you?

Scalper

• Typically in and out within minutes or even seconds.
• Never leaves a position open overnight.
• Goes for as little as a pip.  Typically not more than 10 pips.
• Trades the minute and 5 minute chart.
• Given the small Take Profit, currency pairs with the best spreads are favored. 
• News times are typically avoided.

Day Trader

• Stays in the trade only for the day.  Closes (even at a loss) at the end of the day.
• Trades the 15 minute, 30 minute, and 1 hour chart.
• Take Profit is between 10 and 50 pips.
• Some Day Traders love trading the news, the majority will wait till after the news release and volatility has settled.

Swing Traders

• Hold Trades beyond a day but never beyond a week.
• Trades the 1 hour and 4 hour charts.
• Take Profit is between 50 and 200 pips.
• Wait for several confirmation signals.  Requires a lot of patience!
• Extremely technical traders.
• News is considered noise.

Position Traders

• Trades can last weeks, months or even a year.
• Trades the monthly, weekly, and daily charts.
• Well versed in the financial market and it's long term direction.
• Not concerned with short or mid term market conditions.
• Requires some serious balls in my opinion.   Emotions can run wild and patience is a virtue.

Robot Traders

• Technical Traders that have programmed their software platform to trade automatically for them.
• Backtest their trading plan and adjusts their code on a regular interval (monthly at a minimum).
• Hands-free trading while the computer trades for them.
• Somewhat dangerous as the Robot is only as good as it has been programmed to behave.
• Often successful for a short period of time before suffering major drawbacks.
• Many accounts have been wiped out for these "Holy Grails".

What kind of trader are you?  Well that might not be an easy answer.  If you have done any type of personality test then you might know that the results change over time.  As you grow, your personality adapts.  As you trade, your trading style adapts.

I used to Scalp all the time.  Then I started day trading, and swing trading, and then meddling between all 3 styles.   While I feel comfortable as a Day Trader, I'm starting to feel like Scalping again for a period of time.

As the market changes, your trading style may change.  Same goes for your lifestyle.  

It's like golf really.   As you get better with some clubs, you end up not using the others as much.  But you've had lots of practice with them.   As the course changes and your four-some changes, you adapt.

If you haven't done so already, try each approach, on a demo account of course, and see which one you are happy with the most.

Take a Break

The other day I was in Singapore to get my Thai Education Visa renewed.  Going in I knew that the Singapore embassy was one of the toughest and unfriendly Thai embassies there is and getting my Thai Education Visa renewed was a coin flip.

You see after 1 year of studying Thai at a private school I was starting to get bored with my routine and it was interfering with my trading.  The only teacher that I found I could learn from had classes just around the time I like trading.  Europe Open on Tuesday and Thursday.   Sure I could trade around that but given that my learning was plateauing it made sense to focus on what was more meaningful and fun.

So when I was denied my Education Visa and got a 60 day tourist visa (extendable to 90 days), it wasn't the end of the world.  Sure it's a pain in the ass however now I am going to take a break, be a tourist for 90 days, and trade more.

You see taking a break sometimes helps you get better at something.  For me at this point it will actually help me improve my Thai langauge skills because I can practice what I learnt and learn more on my own.   I can always go back to school, find a tutor, or practice with the many beautiful Thai ladies there are here in Phuket.

What does this have to do with trading?    Simple.  Taking a break from Trading can be the best thing you can do to improve your trading.  Just like in sports or exercise you need to take a break and let your muscles rest (and grow!).  You see often we are so determined we get caught up in it, be it studying, trading, sports, etc and we tend to overdo it, while for a short time that is beneficial, in the long run it can hinder your growth.

Taking a break from trading can really help you.  Like a vacation to recharge your batteries.   Take a week or two, then slowly start just analyzing the markets.  Start looking for new strategies, review your existing ones.   Don't trade.    Put on your observer hat and just get a feel of the market.   Feel the force ;)

Soon you will be in the full swing of things and you will find that those 2 steps backward while taking a break helped you accelerate and run forward, perhaps leap forward.

Perhaps get ahold of your Forex Mentor or Coach and he can guide you to a new start.

Taking a break from Trading can be the best decsion you've ever made.  And boy is it fun trading again after a a couple weeks or months away from the market.

Trading is like Dating

Even if you are married you will remember the time you were single.  For some it was awkward, for others it was fun, and for some people it was a period of ups and downs until you met that one.  For me "Single Life is Happy Life".  Needless to say I still do a lot of dating.  And yes it's a lot like trading.

There are some dating mistakes that most of us will shake their head at but some of you will remember making.  Like falling head over heels for a girl and trying way too hard.

#1  Trying Too Hard

Life, trading, and dating is all about moderation.  Try too hard and you will not get a second date or worse you'll be taken advantage of.  Don't try too hard.  Relax. Take it easy.  While it doesn't hurt to make a good first impression, you don't have to bend over backwards.   Don't trade too much, don't stay up 24x7.  Don't read every book out there.  Take your time.  Good things will come to you.

Lets face it, if you are carrying the girl's school books home then she might lose interest and go for the guy that just doesn't care.

#2  Absence Makes the Heart Grow Fonder

The jock that never helped carry her books, in other words didn't give her all the attention she wanted and was distant.  He had it right.  Either by sure dumb luck or by pure genius.   Women want to date a real man.  They don't want to date their friend, chauffeur, and butler.  They want someone that will tell them No.  Why?  Because women are drawn to leaders. Leaders have higher mating potential, because they take risks and are considered more dominant, more of a survivor, and hence the female body perceives that their sperm will swim the distance.  Women love jerks. 

The market will eat you up alive if you devote your life to it.   Take a break, enjoy life, find another hobby, and for every minute you spend away from "temptation" you will be closer to getting what you want.  Be a leader and control the market.  Don't let the market control you.  Make solid plans, know when to walk away for some breathing room, and don't let a bad trade consume you.  Likewise don't let a good trade give you false confidence.   That girl that you have "wrapped around your finger" can turn on you anytime.

#3 Don't Be Too Cocky

There is confidence and arrogance (cockiness).   Sure she might laugh at your arrogance and cockiness but don't be fouled.  Women are always (over) analyzing you.   Before, during, and after they met you.   Tell some good jokes, talk a little bit about yourself, with confidence tell her about your passions but don't get overly cocky.  Be confident.  Trade with confidence.

Don't start increasing your lot size and prancing around the room telling people how much money you made.   Don't make messy trades because you think you own the market.  Know your limits.  Know when to take a time out and real back into reality.

#4  Be Real

Women can smell bullshit.   And even if you are speaking the truth, there was a line of bullshit men that have given them reason to doubt you.   Don't over exaggerate. Don't embellish.   Don't pretend you are someone you are not.   Women can tell.  Or they will find out. And when they do, it's not pretty.  The market smells your bullshit too. 

Don't tell yourself you are a superstar because you had a few lucky trades.  On a demo account...  Don't quit your day job thinking you have what it takes.   Not just yet.  Be real.   You need to live the life of a trader.  For at least one year.  First on a demo account and then another year on a real account.  Then and only then you have a real feel of the market.  No "oh yeah with a real account I wouldn't have done that" bullshit.  And no "oh yeah I just need to use 5 times as much equity next year" wishful thinking.  Be real.  With yourself.

#5  Baby Steps

You're not going to show up with a bouquet of flowers, a box of chocolates, and a diamond engagement ring on the first date.   And if you do then she will RUN!     Get a grip on yourself, be real and pace of yourself.  

Have a plan.   First date, get to know her.  Second date, make a move.  Third date, if you haven't made a move yet you better make one quick or you'll end up in the friend zone...   The point is you need to have some sort of idea in your head of what your goal is and then plan out the steps to get there.  Or at least pace yourself and not skip any steps. 

Same goes for trading.  Month 1.  Get to Know the Market.  Month 2.  Make some moves, place some trades.  Month 3.  If you still haven't made some trades then you better think about just sitting on the sidelines and watching the market as an observer and get stuck in the F-Zone.

#6 The F Zone

The most dreaded word.  FRIENDS.   Do what you can to stay out of the Friend Zone.  You don't want to be sitting on the sidelines watching her as she dates other guys and comes crying on your shoulder about them.  Just like you don't want to sit and just watch the market.  You need to grab the bulls by the horns and make sure you know how to stay out. 

For one, never ever do lunch or coffee dates during the day.  She's just killing time.  You aren't her favorite choice.  Make sure it's drinks (and only drinks).  No dinners.  You need to have an escape plan before she starts ordering a 5 course meal and she tells you about her crazy ex boyfriend and 5 kids.     Same in trading.  

Take trading serious and don't be an observer. Take the lead and schedule the time to trade.  Commit to an hour a day. Schedule it in your calendar like a doctor's appointment.  Don't try and squeeze it in on your lunch or coffee breaks.  Be serious about trading.  Just like you want to be serious about going on a date and not be picked as her friend.   Let her find a gay friend for that.  Stay out of the friend zone by being a man, not her friend.

#7  Know When to Walk Away

Know when to put your foot down.  Know your limits.   Know when to walk away.   When you're dating you need to weed out all the crazies and incompatibles.  Don't let "love" blind you.  There is a difference between being "in love" and "loving" someone.   And if you're just starting to date then you are likely just "in lust".  

Know when to walk away.  Do so when knowing that the risks are just not worth the reward.  Like waking up with your testicles chopped off.   When you're trading "walking away" is the most important skill you have.  Think of the market as dating opportunities 24 hours a day, 5 days a week, with opportunities almost every hour.   You need to know when to walk away and sit out a trade.  Sure the Moving Averages look good, the MACD looks good, but there is news coming up and the trend analysis doesn't look good.  Walk away. Save yourself the headache.

The minute she wants to be friends...  When her ex is back in the picture...  When she starts showing some real emotional issues...  When you just don't feel the connection...

#8  The Routine

I have been on countless dates.   It's really down to a routine.   I meet for coffee, always after sunset, so it's more intimate, and I never go for dinner.  I get to know the girl, what she does for work, for fun, her family, what she's looking for.  I crack some jokes. Tease her a little.  See how her body language responds.  Is she smiling, giggling.  Touching me.  Then I ask her to come back to my place for a night cap or to watch a movie.    Maybe a bit aggressive but why bother with date 2 or 3 when there is no chemistry and trust on the first date.  And as for just coffee, well I find dinners overrated, time consuming, and boring.  I don't like to eat out and find when a girl is more interested in how much money you spend on her than she is in just having a conversation in a neutral setting, then she isn't worth my attention.   That's me, that's my routine.  I am happy.

When it comes to trading my routine is not dissimilar.  I get up in the morning, drink a glass of water, then make Strong Espresso.  If and only if I'm fully awake then I glimpse at the market.  Get to know the market.  I do the same basic checks, what's the big picture, where is the market moving now, what news is coming up, what are my indicators telling me.   Are the indicators favorable. Am I liking the situation.  What is the risk, what is the reward?   Sometimes I walk away, sometimes I make a move.   If I have made a trade I will keep an eye on it.   Around lunch and dinner times (they happen to coincide with Europe Open and US Open Times), I have another look and see what is developing.  If I don't see anything I'm usually happy.   Just like I'm happy to ditch a date from hell by taking that emergency phone call "Oh my god, what happened?  I'll be right there" "Sorry gotta go".     I know far to well that waking up next to a basket case is just as bad as hitting a Big Fat Stop Loss.   I either go out on a real date at this point, do sports, or watch a movie.   Eventually bed time hits and the next morning I repeat my routine.

I keep a normal routine.  I don't believe in working late. I don't believe in trading all hours of the day.  I believe in trading around your lifestyle and schedule.   Integrating trading with my lifestyle.  Of course there are times you have to make trading a priority, just like you make that hottie with the hourglass shape a priority when she smiles and asks you what you're doing later tonight.

All in all trading is like dating.  A lot of gotchas.  A lot of lessons learned.  Eventually you will have it down to a routine and enjoy that routine.

Happy Dating. ;)

Bad Trades are Good

Another week of trading is coming to an end. Here in Thailand I'm already relaxing at +35C.  If you're in Europe the trading day just started while in the US it's middle of the night.   I typically stick to the saying Don't Trade on Monday's or Friday's and today it sure looks like it's time to call it a day.  I've made my pips this week already.  I hope you have too!

 

I hope you've had a good week.  And if you've had a bad trade then this article is for you!  You see Bad Trades are Good!  Bad trades are a learning experience. 

 

The worst thing that can happen to you is making too many positive trades when you start trading.  It gives you false confidence. I know because it happened to me.  When I first started trading I made nothing but positive trades.  I think 79 in a row was my record.  It gave me a false confidence.  I made some bad trades here and there but by far I felt unstoppable and on top of the world.  Positive time and time again.  Until one day I had back to back losses.

 

I couldn't believe it.  Back to back losses.  Big losses.  What was wrong?  I had been a rising star and now I'm in the minus for the day. The week. For the month!   What the hell?

 

Well it was the best thing that happened to me and I wish it would have happened sooner because you learn the most from your mistakes.

 

So if you've had a bad trade.  Shake it off.  Go on with life.  Stop trading for the day.  Then when you have a clear mindset, maybe after you slept on it, then go back and retrace your reasons for going into the trade. Then determine what went wrong and what you can do in the future to not make the same mistake again.

 

The most common mistakes are:

 

• Trading shortly before, during, or shortly after news.  The market is too volatile.  Like that high wind crashing wave after wave into the ocean shore.  Wait to ride a good wave when things settle down.
• Trading before Market Open times.   Make a note when the Europe, US, and Asian Markets open.  Try not to trade shortly before that time.
• You feel the market is turning.   Unless you are a seasoned trainer or can predict the future, don't get caught up in trading potential reversals.   Trust me, you'll know when a currency has reversed direction.
• Your analysis wasn't thorough.  Always get a feel of trend and market conditions on ALL timeframes.  Monthly, Weekly, Daily.   Technical analysis on the bigger time frames is key to taking calculated risks.   If all the major timeframes say down and you are going long based on a signal on a 5m chart you are asking for trouble. 
• Your lots size was too big.   Bigger isn't always better.  If you are sweating just a little bit when the market isn't moving the way you thought it would, well then you are using a lot size that's too big for your comfort level.   You can minimize your risk and maximize your reward by using a lot size that's proportional to the "strength" of the signal and your analysis.   The more certainty the bigger the lot size.  For example,  I will trade a full lot if several indicators confirm my signal.   If the confirmation isn't strong then I'll half the lot size. 
• You can't stay out.   Many people will be somewhat addicted to trading and want to place a trade every day either because they want to prove to themselves they can do it or because they feel this need to trade all the time.  It's like overeating.   You get thirsty and instead of drinking water you opt for a Big Mac.   And after you're done with the meal you didn't really need you hit up a coffee shop and suck back an iced latte and a couple donuts.   Self control is a must in trading.  All those calories add up.  All those trades out of boredom or lack of discipline will add up too.
• No confirmation.  Some people see an entry but jump the gun too quick and place their trade before waiting for the confirmation..  For example CCI or RSI are great indicators for confirmations.  Candle closes and opens are too.   MACD.is another great oscillator for confirmation.    You need to wait for a candle close before your signal is valid.

Whatever the reason for your bad trade.  Study it and find out what you're doing wrong. 

One of my students has a big problem with this and hence she is struggling.  She just wants to place a trade and make money.  When she makes a bad trade she throws her hands in the air and complains, instead of analyzing her mistake.   And when she does analysis it's only for the signal and not for the confirmation or "red flags" like a major trend line or upcoming ECB or FOMC News Event.

You will learn more from your bad trades than your good trades.  So don't be afraid to make mistakes, just be committed to analyzing your bad trades.

Insanity is a Full Time Job

In all likelihood you are familiar with Albert Einstein's quote:  "Insanity: doing the same thing over and over again and expecting different results."


Insanity truly is a full-time job.  On so many levels.

• Making mistakes over and over again will keep you busy all day long.  Without desired results. So you keep on repeating and spending more time, energy, and focus on something that is likely to fail again.
• Full-time trading is overkill.  Sure there are traders that live for being glued in front of their computer screen 24 hours a day, 5 days a week, and perhaps even keeping busy somehow with analyzing trades on the weekend.  It is fun for sure.  When I first go into trading that's how it was for me.  BUT and this is a biggie, in my opinion, it's like a sport.  You don't want to over-exhaust yourself and play Badminton 4 hours per day, lift weights 4 hours a day, and then go for a 20K run.  Every day.   Your body needs rest.  So does your mind.   And if you get hooked on a sport, say running, and you love that runner's high, you can get away with running every day for a while but soon enough your body will tell you that you need to pace yourself.  Run every other day. Or just run a little every day but rest once or twice a week.  Sometimes your body (and your mind!) needs rest every couple months for a week or two.   So don't overtrade.  Pace yourself.  Sports may be a "healthy" addiction, Trading is not.  Either way even healthy addictions can bite you in the ass. Do everything in moderation.
• A full-time job does drive me insane.  I just don't have the time and energy to deal with all the b.s. for little pay.  Or even great pay for that matter.  Making $200,000 / year is great.  But if it doesn't fit your lifestyle and you are not happy then you are going to insane trying to fit in and "ride it out".  Sure in 5 years you have made a million, and in 10 years you will have saved a million from the 2 million you made.  BUT life has gone by and you will never get that time back.  If you are unhappy and rich, you are still unhappy.   If you are happy then it doesn't matter how much you make, every day is a gift, and you realize that you don't need much to survive.  I have learnt this the hard way but now I am in Thailand living it.  Don't get me wrong, I still make good money, I don't make $200,000 a year.  Because I don't need it.  I make more than I need to live.  If I want to go to Europe then I just make the money I need and then go.  It's similar to planting a garden.  Why plant more than you can eat?  Sure you'll have some extras to give to neighbours but why plant a field of Basil when you just need a couple bushes.
• Lifestyle.   Sit back and ask yourself "Why was I born?"  "What is life's purpose?"  "What makes me happy?"   "Where do I want to be in 1 year, 3 years, 5 years?"   "When it's time for me to move on and leave this world, what will I look back on?"   Chances are you don't think working is your life's mission.   My motto is "Work to live, not live to work!"
• Not all day's can be sunny days.  You are going to drive yourself insane thinking you need to trade every day.   Life isn't all sunshine and lollipops.  There will be rain, there will be bad weather, life will happen.  So don't expect to be trading every day.  The sun is brightest after darkness.   Find other things to do on "rainy days".

Stay Sane.  Trade in Moderation.  And please get help from an expert.   I just discussed this with my friends Mr. Teddy and Mr. Jai.  If you learn to golf, you should start with a pro.   Sure you can try on your own and get golf tips from someone that plays well.   But you will develop bad habits and eventually realize you spent all this time, effort, and money, and are still doing it wrong!  Then you will seek out a pro, and he will have to reteach you everything, break your bad habits.  That takes more time, effort, and money than learning how to play golf from a pro in the first place.  Please find yourself a good Forex Coach.   If it's not me, that's fine.  I don't take on many people.  BUT be careful to select the right one.  Unfortunately when it comes to money and investments, there are a lot of scams and cons out there.  A lot of "golf pros" that have never played "professional golf" but make money from teaching.

....to be continued

Rotten Fruit

Arriving home from Thai Language class I went to grab a banana and had ants and fruit flies everywhere due to the bananas' ripening.  Don't you hate it when you have to throw out food?  All the best intentions in the world justify your decision to buy fruits, vegetables, and other food with expiry dates.  And for whatever reason you then are faced with having to throw out rotten food.

Once in a while we need "rotten fruit" as reminders.  Growing up in a world where there is a surplus of food, we take it for granted and don't realize how good we have it.  Others are starving.  My parents often told me about their experience growing up in Post World War 2 where they counted how many peas one could have for dinner.  And that was the only dinner.  Potatoes and other vegetables were traded on the black market.  Not only do we not appreciate today's abundance of food, but it hinders our creative thought process and drive.   Arnold Schwarzenegger when asked what made him successful said "Stay Hungry".  Overfed hunters lose their ability to hunt.  The well fed are not hungry enough to strive for more.   When you are constantly hungry you strive to do better, to do more with less.   So in a way when it comes to shopping and cooking, today's meals aren't as creative as they used to be.  In the post world war 2 days one had to come up with creative way to make do with what they had.   Don't be fooled by so called "peasant foods".  They are nutritious, delicious, and filling.  Here in Thailand I get more satisfaction from cheap food rich in herbs and taste, say Pad Kaprao, than from a meal that costs me 10 times as much, perhaps Thai but mostly Western.

Shopping only for the next dinner is far more rewarding. It eliminates waste.  Your ingredients are fresh.  And if you are in a bind because your fridge is somewhat bare, suddenly that one vegetable, fruit, or food item, that would have been overlooked in a full fridge, becomes inspiration for creativity.  You tend to think more about what you are going to cook and how, rather than think about eating, and perhaps eat more because you just have to have the pudding, crepes, and yogurt because it's there looking at you.  And after you are full and over nourished.  Intoxicated by overstimulation.   If you had to go hunting again, you'd have not will or interest.  Worse yet you are going to get fat and your body and mind will be stressed.

Trading is not dissimilar.   There are plenty of trade opportunities. Plenty of pairs.  The market is open 24 hours a day, 5 days week.  You can go long on EURUSD, short on USDJPY, heck you can hedge your trades if you feel the market will swing either way.   Is that a good thing?  Or are you juggling too many balls?   Too many moving parts.   Too many eggs in the basket.     Bitten off too much to chew.   You might get lucky and all your trades go well.  Or you could choke on that big bite and with more at risk, you lose more.

Stay hungry.  Go for low hanging fruit and only pick what you need to eat today.   There will be low hanging fruit again.  Don't over trade.  Trade only when the market conditions are strongly in your favor and you have minimized your risk.