On the chart below, we see that a bear trend has begun in late December and the three EMAs appeared in the order we are looking for.
On January 7th the 4-day EMA crossed the 8-day EMA in a top-down manner, while on January 8th we could make our move — to buy a put option with an expiry time of 1 week January 15th in this case. On the chart below, we see that a bull trend has begun in late July and the three EMAs appeared in their perfect order. On August 18th the 4-day EMA crossed the 8-day EMA in a bottom-up manner, while on August 19th we are able to take action — to buy a call option with an expiry time of 1 week August 26th in this case.
Another call entry opportunity occurred on October 24th, after a day earlier the perfect order of the moving averages formed. Unless you address them honestly, they will influence your trading on a subconscious level and lead you astray, no matter how well your intellect grasps your chosen trading strategy.
The market is a zero-sum game, an impartial, unsympathetic referee of the adversity of thousands of combatants. It possesses an uncanny talent for uncovering your vulnerabilities, and it will turn them against you. In my own case, at some level, I knew darn well that my early gun-slinging ways were unduly risky. So why did I fool around like that? To trade successfully, a trader must love the action.
Great traders love to trade. Wealth is the byproduct of successful trading, but pursuit of wealth is not the primary motivation of great traders, at least not in their formative years. Unless the markets fascinate you, unless you wake up each day with a passion for the game, you will not become a successful trader. I believe great traders share this quality with great athletes. But long before they won fame and fortune, they fell overwhelmingly in love with their chosen sports. That passion drove them to mastery and excellence. But any emotional need, indulged without balance, is a prescription for disaster, whatever your field of endeavor.
In the world of trading, the pros learn to harness their passion for the game with a disciplined, businesslike approach aimed at maximizing returns and minimizing risk. To find that balance, you need more than a defined trading plan. You must align your emotions with your goals. Only then will you possess the resolve to carry out your trading plan. We all consciously desire profits, but deeper impulses lurk at a subconscious level. If those impulses remain in the subconscious, they will influence our trading decisions to our disadvantage. By becoming mindful of those impulses, we can take corrective action.
Simple and Profitable Strategy For The Short-Medium Term Trader
Hyperactive hunger for the action was my own psychological Achilles heel. I remain vigilant against it every day of my trading life, but over time, the temptation to overtrade has diminished considerably. What is your Achilles heel? Nefarious influences come in many different forms. Try to be aware of your random thoughts and emotions during the trading day.
Just take notice. And have a sense of humor about them.
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That is the first step to keeping those influences clear of your decisions. The next step involves regular post-game analysis of your trades. You should already be doing this. The study of losing trades is the best way to improve your skills and technique. Ask whether something within you blinded you into making those technical mistakes. I assure you: You will make many startling discoveries as you find misjudgments rooted in yourself rather than in the market! Self-appraisal is key to success in any field. Is this lone-wolf machismo?
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Quite the contrary. My problem is that I am very impressionable.
In contrast, Cohen requires a team approach. Many traders like to fight their own battles. I prefer to get a lot of support. Each Wizard has evolved to reinforce his psychological strengths and minimize his psychological weaknesses. When I began trading, I consciously desired profits, of course. But on a deeper level, the trading action itself gave me my immediate pleasure. So on a subconscious level, I got what I wanted from the market, even though I was losing money!
Medium-term Forex Trading: Profitable Way of the Experienced Trader
It was only after I recognized this fact that I developed the emotional control needed to carry out a rational trading plan. I still love to trade. I still enjoy the action.
But I have subordinated those pleasures to the goal of making money. At that point, I ceased shooting from the hip and became an ambush artist. I adopted and stuck by two rules:. Trade no stock that is not already on my watchlist. If I discovered a stock breaking out during the trading day, I might analyze it to develop an idea of current market conditions and strength, but I would not trade it.
I also would ask why I had missed the stock in my afterhours research. Product Image. Company Details. About the Company. Nature of Business Service Provider. I agree to the terms and privacy policy.
Simple and Profitable Strategy For The Short-Medium Term Trader - BullBull
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