Category: Trading

Day Trading Indicators and Indicator Trading

Day Trading Indicators and Indicator Trading

Did you start day trading after buying a book on technical analysis, and getting a charting program – probably a free one that you found online – in order to save money? While reading your book you learned about trading indicators which could ‘predict’ price movement, and what do you know, the ‘best’ indicators were actually included in your free charting program – let the games begin.

Now that you have all the day trading tools that are necessary, the book for education AND the free charting program with those ‘best’ day trading indicators, you now need a day trading plan so you can decide which ones of those ‘magic’ day trading indicators you are supposed to use. This really is a great book, besides telling you how to day trade using indicators to ‘predict’ price – it also said that you need a trading plan to day trade.

So what should this plan be? The book told you about trend following using an indicator called macd, and it also told you how it was possible to pick the top or bottoms using an indicator called stochastic; my guess is that you picked the stochastic indicator to start your day trading – this must be the ‘best of the best’ since this indicator was going to ensure you of entering your trades with the ‘best’ price. Amazing, simply amazing how easy this day trading stuff really is. In fact, why even bother taking the trades, each time your indicators give a signal – just call up your broker and tell him to stick $ 100 in your account.

My book was Technical Analysis of the Futures Markets. My charting program was TradeStation with an eSignal fm receiver; that was the one that if you hung the antennae wires just right, and you put enough foil on the tips, you might even get quotes. I had sold a business before I started trading so I did have some capital – isn’t that how everyone gets into trading, you either sell a business or you lose your job? My indicator was the macd as I had decided that I was going to be a ‘trend follower’ instead of a ‘top-bottom picker’. I also decided that I was going to be ‘extra’ clever, if one indicator was good than two indicators must be better, so I added a 20 period moving average. My first trade was a winner, then after many months of extensive therapy, I was finally able to forget the next twelve months – ahhh the memories

Learning To Day Trading – The Learning Progression

Beginning to day trade, or learning to day trade, as an indicator trader is very typical. This is also logical when you consider – HOW are you supposed to initially learn how to trade? Trading indicators are available to anyone who has a charting program, and simply using line crosses, or histogram color changes, provide ‘easy’ signals to understand. If you will also take the time to learn the arithmetic behind your indicators, as well as learning what each indicator is specifically intended to do, not only is this a logical way to begin, it is also a good ‘step’ in your learning progression – understanding the WHAT you are doing, instead of attempting to create ‘canned’ indicator only trading systems, without any regard as to WHY you are trading this way.

This does become one of the ‘sticking’ points in your learning progression, as you come to find out that you are unable to profitably trade indicators as signals only – now what? Now what – you ‘can’t’ develop your own indicators, so you start doing google searches for day trading indicators and start buying your ‘collection’ – they don’t ‘work’ either. Now what – you buy a mechanical trading system – what does hypothetical results may not be indicative of real trading or future results mean? Now what – you start subscribing to signal services OR you start joining the ‘latest and greatest’ chat room – am I really the only person using the signals who isn’t profitable?

Now what – you never learn how to trade.

I began trading as an indicator trader, and I did try to learn everything that I could about the various indicators, as well as trying to combine indicators that were consistent with how I wanted to trade – I just could never develop a mechanical day trading system from what was available to me. I read a couple more books that didn’t really help me, so I then started looking for someone who could teach me. From what I now know about gurus -vs- teachers, I am very lucky that I got involved with a money manager-trader who taught me a tremendous amount, but I still couldn’t get profitable, in part because there was also ‘pressure’ to learn how to trade using real money. As well, any discussions or thoughts about trading psychology and the issues involved, especially to beginning traders, was non-existent.

Now what – learning but losing – I stopped trading.
Learning to trading using real money, and ‘scoffing’ at trading psychology as simply individual weakness, really was something that I now regard as misinformation. I always mention this as I now feel that this cost me as much as a year of time, and was very close to costing me my trading future, as stopped trading was VERY close to quitting trading. How can’t trading psychology be real to a beginner, when you consider that you are risking losing money at a very fast pace as a day trader, and when you further consider that you are also doing this when you really don’t know what you are doing – this is NOT by definition being weak. And if trading psychology is real, how are you going to learn to make ‘good’ trading habits with real money while you are fighting the implications?

Now what – not trading and not ready [quite] to quit – still studying and searching.

Probably the single most important ‘thing’ that got me to a next step in learning how to trade, was the concept of a trading setup, and that a setup and a signal were not the same. This was extremely meaningful to me, as it also led to an understanding of how to better use trading indicators for the information that they can provide, but not to use them as trading signals – in essence I began learning about trading method where discretion could be consistently applied -vs- trading system that was mechanical and arithmetic rules.

Traders who are indicator only traders, are also what I refer to right side only traders, that is they are always looking at the right side of their charts for an indicator signal. BUT what about the left side of the chart, what about price and patterns, what about market conditions – WHAT about the relevant ‘things’ that are ‘moving’ price, instead of indicators only as an arithmetic derivative of price, and thus, one that is dependant on the time frame that you have chosen to trade from? These ‘thoughts’, along with the concept of trade setup, became instrumental in the development of a trading method, and how I came to turning my trading around.

When I think about the steps in my learning progression – I would list them as follows:

2/95 – 6/96
indicators only
teaching service that included signals
learning to trading with real money and trading psychology issues
stop trading

6/96 – 3/97
understanding of trading psychology issues
learning about trading setups concept
trading method -vs- trading system
trade setup – trade trigger are not the same
method development
understand the importance of the left side of the chart and what is happening ‘across’ the chart
related trading setups and how/when they triggered
indicators + pattern
indicators + pattern + price
indicators + pattern + price + market conditions

3/97 – 11/97
able to paper trade profitably
able to real money trade profitably
able to trade for a living

Indicator Only Day Trader – Setup Including Indicators Method Day Trader

I have attempted to discuss the way I started day trading, and the way I think many-most traders typically begin. Along with this, I have pointed various issues and problems that I had – those regarding how to learn to trade, and then progressing into a profitable trader. My experiences have been both personal, as well as those of many traders that I have worked with over the last 8-9 years through Tactical Trading – that a very large number of these problems are due to day trading only with indicators, the specific indicators used, along with trying to turn these indicators into a mechanical trading system. This is not to say that this can’t be done – I simply couldn’t do it. However, I would strongly suggest that anyone who is in the early stages of day trading, or struggling with their day trading, consider these things that have been discussed.

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Is Stock Day Trading For You?

Is Stock Day Trading For You?

How do you become a successful stock day trader? And what is stock day trading anyway?

Day trading is the ability to buy stocks, currencies or futures, and then sell them on the same day. Out of the transaction, a skilled day trader expects to earn a reasonable profit. Notice that the word skilled is important. Stock day trading is not for the uninformed, lazy or unskilled trader.

While many traders experience more losses than gains in day trading, there are still some dedicated stock day traders who swear by their trading system and continue to reap the benefits. Here are some advantages of day trading and how to go about becoming a stock day trader, as related by successful day traders.

One major advantage of day trading is being able to work on your own when and where you please. You are your own boss. You don’t have to consult with others before making a decision. In fact, you will usually be better off by not doing so. Should you fail, you are the one accountable for your trading losses.

Since there is no one to check up on your trading decisions you must have the self discipline and hardworking attitude to know your trading business well. You must be able to put your emotions on hold as you make your trading decisions yet be confident in those decisions and not be afraid to trade.

Because more people want to become involved in day trading there are now more sources of information that you can find compared to many other kinds of online businesses. Be diligent in reading these materials, as they can help you as you learn more about day trading. But be cautious of some of the information that you find on the Internet. Some website offers are mere enticements to get you to part with your money and to subscribe to their services or to purchase their software without giving any useful value in return.

You do not need to know much about stock trading before you can try stock day trading. Anybody with a high speed Internet connection and a little risk capital can venture into day trading. However, if you want to trade at a profit and be successful, you need to study how trading systems work, find one that is suited to you, and work hard at mastering it. Most people who try out day trading without preparation and without a good day trading software program will lose money.

In day trading you don’t want to speculate or make decisions based only on your opinion of trends or your gut feelings. You must master a trading system and base your decisions upon the systems trading signals. If you use a proven system you should be able to gain over the long term by using the same system over and over again. That is if you have the discipline to follow it. The main reason so many day traders end up losing money by trading is that they fail to follow their own trading system even when they have a very good one.

One of the major advantages of day trading is that there are some very good off the shelve software trading systems that will generate accurate trading signals. You must take the time to research various software offerings and be willing to pay for a trading system that suits your trading style.

The matter of being disciplined with your trading comes up again. Discipline, discipline, discipline, there is just no way to get around it. To be a profitable day trader you have to possess the iron clad kind.

These are only some of the advantages of day trading. The main disadvantage, of course, is the always present risk of losing money. As with any business venture, the risk of loss is always present. That is why it is important that you understand the day trading business well before getting involved with real money trades. Perhaps by starting with a demo trading account you can develop your strategy and skill level and minimize your risk.

You should trade small positions until you can test your trading system and see how you and your system are performing. Day trading is a highly scalable enterprise. Once your system is working well and you have confidence in it you will find it is easy to step up the size of your trades. Just don’t over do it and trade all out with only a small amount of capital to back up your trades.

The most important thing to realize if you want to become day trader is that you do not want to always be in the market. Most day traders over trade. They do not wait until a trade sets up just right. They lack the discipline to be patient and to wait for the proper signals before pulling the trigger.

Some day traders wait too long before pulling the trigger on a trade. That is they wait, and wait, and wait for the perfect trade. Since there will always be an element of uncertainly with any trade the waiting trader will be too late in entering a trade and as a result will probably lose or make only a small profit.

To become a successful day trader is not easy. But it is amazingly profitable for those traders who master the art. A really good day trader can make hundreds of dollars, even thousands of dollars, almost every trading day. That is the reason so many people want to give day trading a go ready or not.

But, believe me. It is best to learn what you are doing and to be ready before trading with real money. The cost of experience can be high for the unprepared.

If you have an interest in stock day trading, foreign exchange trading, commodities trading and other day trading information you may want to visit Taipan’s stock day trading website.

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Trading in MCX – Vital Tips for Trading Different Commodities in MCX

Trading in MCX – Vital Tips for Trading Different Commodities in MCX

Commodity exchange has been taking place since the 19th century but in those days the trading was done in certain basic commodities like sheep, corns, wheat and other cattle. With the passage of time and advancement of technology, commodity exchange became wider and several news commodities were included to be traded.
Commodity trading business is growing by leaps and bounds over the last few years in India. MCX (Multi Commodities Exchange) is the leading commodity exchange. The commodity of was established in 2003 and about 2/3 of commodity trading volume is contributed by trading in MCX. It is also the 5th largest exchange in the world in terms of the number of future contracts traded by the investors. The MCX market mainly comprises of base metals such as Zinc, Lead, Aluminum and precious metals including Gold and Silver. MCX commodity trading also includes trading of energy products such as natural gas and crude oil.

If you wish to invest in stock commodities, the following tips greatly help you how to understand the right techniques to invest in different commodities to earn maximum returns:

* Trading in Bullion Commodities:

Trading in bullion commodities involves trading of precious metals like platinum, palladium, gold and silver. Before investing in the bullion market it is important to analyze the existing macro-economic situation of the country including interest rates, growth rate in GDP, inflation and energy prices. You must invest only if these economic indicators are favorable for trading in MCX.

The silver market value is much smaller than gold, so if you wish to invest in Silver it advisable that you do a thorough study of the supply and demand in the market. Since metal is referred as poor man’s metal it guarantees better returns, however, the nifty market experts suggests that you must avoid buying the metal at spot price.

* Trading in Energy products:

Energy commodities trading have a great impact on both investors and non-investors. Even a slight change in the prices of the energy commodities can have a radical effect on the prices paid by the consumers.

* Trading in Base Metals:

Base metals are crucial for the growth of global economy. While trading in basic metal you must consider the following nifty trading tips:

* It is important that you understand about the metal before investing in it; you must study the metal profile.
* You must be abreast with the latest MCX exchange news and know about the factors that affects the price of the metal.

* It is advisable that you subscribe for services that offer live charts or real time figures about the demand and supply of the metal in the global market. This would help you make informed investment decision.

* To succeed in the commodity trading it is important you learn as much as you can about trading in MCX and develop bargaining skills and act on your intuition.

Known about how the market function and staying abreast with the latest news of the market is the key to success in trading in MCX, you need to constantly refer to commodity trading tips to maximize your profits.
Online Share Trading – Tips for Amateur Traders

Online Share Trading – Tips for Amateur Traders

Online share trading is a profitable business venture. However, only a few investors enjoy great success in the business while many other falter. This is mainly because the unsuccessful investors are not aware of the important principle for winning in the share trading business. To be able to succeed in the share trading business, you need to have penchant for learning new trading techniques and constantly develop new skills to gain edge over other investors in the market. If you are an amateur investor, the following online share trading will greatly help you:

Know How The Trading Business Works:

One of the important aspects of being successful while trading in MCX is to know how the share/commodity trading business works. You must invest your time in researching about the market condition and the latest market trends. This would give you a better idea about what you need to do to be successful in online share trading business. You also need to research about the rules and regulation guiding the business, what are the different types of equipments you need, understand the technical jargons and have a strong knowledge base before you start putting your money online. You also need to constantly keep updating your knowledge about the business and be abreast with the latest news and develop the skills of adapting quickly as per the market condition.

Patience Holds The Key:

Expert stock commodity traders who offer commodity trading tips to newbie investors suggest that being patient is the virtue to succeed in the business. You need to wait for the right time to make the right deals in online trading to be sure that you would get valuable returns. While it is important to take a few risks, you need to understand that doing risky deals often would lead you to suffer loss; you need to be patient because you would to be in the trade for long. You must wait until you grab the right opportunity with both hands.

Develop A Good Trading System:

While it is true that no system is ideal in online share trading that would ensure profitable returns always, it is important that you have a good trading system in place. This is because all successful share traders definitely have a certain system which they use to determine whether they would invest in certain shares or not. You can try using a couple of different trading systems and stick to one which you feel is the best even if you suffer losses a couple of times. You can use the stock market technical analysis to determine if investing in certain stocks or commodities have the potential to grow in the future and help you earn good returns. Also you must set a limit for your loses before you adopt a different strategy.

While trading in MCX you must know about the basics of the trading business and understating the stock market technical analysis methods would greatly help you be successful in online share trading business.

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CFD Trading Strategies to Boost Your Trading

CFD Trading Strategies to Boost Your Trading

CFDs or Contracts for Difference are trading instruments which allows traders to invest as per the movements of prices in the market in the long term. The holder can sell or buy an asset at a future date at a current price. These are traded by the CFD brokers. Traders can definitely take advantage of leveraged positions. Although trading CFDs may sound easy but getting the desired results is not that simple. The biggest problem in enjoying a successful investment is the absence of product as well as investment knowledge.

Just like any other type of investment, CFD trading also involves risks. Therefore CFD trading strategies can act as a guide in your trading. In order to have a successful and sustainable investment it is important to know how to formulate your CFD trading strategy. It becomes difficult to earn desired profits in the absence of proper strategies.

Going long is the most widely used strategy. It involves searching for markets, indices and securities that provides potential long profits. CFD is one of the trading instrument which traders can use to bide their time as well as money whenever the market is in their favour.

Going short strategy involves selling contract as the fundamental act and purchasing them whenever prices fall. This trading strategy is used when the market trends are expected to go down in the long term. It requires trader to find out the factors that may considerably impact the performance of the instrument and maintain a small position reaping the benefits of the expected downfall

Pairs trading is another CFD trading strategy that is very popular among the big investors. It involves finding and investing on related shares and instruments which can fluctuate in tandem.

CFD trading depends on individuals and situation and therefore suggesting a standard strategy is very difficult. Selecting appropriate CFD trading strategies involves considering various factors such as trading objectives, available capital and risk tolerance level of the trader.

Trading Lounge is an online trading, analysis and education service that offers services such as Day Trading- cfds like cfd trading,cfd trading strategies,Trading Strategies, Technical Analysis, and How to Trade advice by a reputable and experienced trading coach. TradingLounge.com.au was started by Peter Mathers in 1982 to meet the growing demand of accessible and sensible education in online trading.
Benefits of CFD trading report provided by Trading Lounge

Benefits of CFD trading report provided by Trading Lounge

CFDs or contracts for difference are one of the most preferred financial services. They are flexible, powerful and easily accessible instruments which help you to get exposed to different markets such as Australian shares CFDs, Stock market indices, International share CFDs, Commodities, Foreign exchange, etc.

Investors and traders with different levels of experience and backgrounds are now trading CFDs to maximise their returns and manage their risks in a better way. Trading Lounge offers a number of trading reports – CFD trading report, Forex trading report, Share trading report and investment trading report for beginners and experienced traders. These reports provide an insight to our methods and strategies that will improve the chances of earning profits from the markets.

The guidance, education and suggestions given in our CFD trading report aim at helping our members make the most out of their trading by offering high quality research and analysis.Trading Lounge’s CFD report is one of the most comprehensive CFD trading, news, research and education service in the trading sector.Trading CFD is a challenging pursuit which requires traders to be aware of different information streams at a single time in order to receive the best results.

Trading Lounge offers a wide range of trading reports which includes:

Day ahead Report – The daily report Monday to Friday 7.30 AM Australian Eastern Daylight Time (AEDT), (UTC/GMT +11). The day ahead report is a daily technical analysis report which is published before the trading day in Australia, UK and the US. It gives a thorough analysis of the overnight markets US, UK and Europe.

The CFD trading report provided by Trading Lounge comprises of certain trading ideas for securities from across the world, helping traders who uses these reports to expand their activity and take part in important opportunities at any one time.Apart from our suggestions and analysis, the report also contains plenty of CFD related education and research. Our objective is to make our education and trading as simple and easy to understand as possible.

Trading Lounge is an online trading, analysis and education service that offers services such as Day Trading-cfd trading report, Trading Strategies, Technical Analysis, and How to Trade advice by a reputable and experienced trading coach. Tradinglounge.com.au was started by Peter Mathers in 1982 to meet the growing demand of accessible and sensible education in online trading.
Importance of CFD trading education

Importance of CFD trading education

A CFD does not have volatility premium or time value. It is just one for one equity swap. Like equity swap, CFDs are OTC, meaning the contracts can be customized as per the needs of the individual and exchange fee can also be avoided. However, selling may be difficult if one cannot find a seller for a CFD.

Before entering CFD trade, it is very important to understand them as for new CFD trades it can be daunting. There are various companies that offer CFD education to the new traders however, many a times this could be quite expensive. Before paying thousands to a CFD education provider, one should do some extensive research and go through various CFD ebooks available online. Consider paying to your CFD educator only after you have understood the fundamentals of CFD trading and are ready to take the next step.

One of the most important features to be considered while choosing the right CFD trading education is the feedback about the provider received from past graduates. This is crucial as there are some education providers that will ask huge amount for the study material that is available for free on internet.

A good educational package will provide you with details on as to how to manage risk, develop a trading plan and effectively distribute capital across forex, share and index CFDs. It is also important to implement your trading plan to ascertain that it is as per your lifestyle as trading should not become a burden in the long run.

After learning how to create a trading plan, it is crucial that you follow it. Lack of discipline is one of the common mistakes made by the new entrants which leads to trading mistakes.

There are many good CFD trading education materials available, however choosing the the right educational course offered by a reputed provider plays a very important role. Sometimes attending a trading expo or inquiring educational providers over phone can be helpful as this will help you to understand the authenticity of the provider.

Trading Lounge is an online trading, analysis and education service that offers services such as Day Trading-cfds like cfd trading,cfd trading education,cfd trading strategy.Trading Strategies, Technical Analysis, and How to Trade advice by a reputable and experienced trading coach. Tradinglounge.com.au was started by Peter Mathers in 1982 to meet the growing demand of accessible and sensible education in online trading.

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Long term CFD trading strategies

Long term CFD trading strategies

CFDs or Contracts for Difference are instruments of trading which provides opportunity to the traders to invest as per the long-term movements of prices in the market. CFD allows the trader to sell or buy a single tool at some future date at today’s price point. These are traded through CFD brokers. It gives a leverage position to the traders. Although, participating in such type of trading appears easy, getting the desired results is not that simple. The biggest challenge in making a successful investment is the absence of product knowledge and knowledge of your investment. However, this problem is getting resolved with investors being more informed about the market and choosy about their investments.

As in any other kind of investment, risks are always associated. Because of this reason, it is crucial to refer to CFD trading strategies as a guide to your trading. It is important to be able to design your own strategy for having a sustainable and successful investment. It is difficult to achieve your goal I.e earn profit without having a proper trading strategy. Infact, there are applicable CFD trading strategies which can be implemented by interested CFD traders.

One of the most popularly used strategy is Going Long. It involves searching for markets, indices and securities that provides effective long term results and investing on them. CFD is one of the trading instruments that is beneficial to traders as it can bide their money as well as time whenever they feel the market is in their favour.

There is also a Going Short strategy which is related to selling of contracts as a front act and buying them again whenever the price falls. This CFD trading strategy is helpful whenever there is a risk of downside in business or trade in the long term. It is required for a trader to find out the factors that may considerably affect the functioning of an instrument and acquire a small position leveraging the downwards trend that is expected to occur.

Another CFD trading strategy is Pairs trading. Pairs trading involves investment on related shares and instruments which can possibly fluctuate in tandem.

CFD trading differs for people and situation thus there is no perfect standard strategy. Choosing the suitable CFD trading strategies involves taking into account several factors like trading goals, available capital and trader’s level of tolerance risks. Once the investor finds the appropriate strategy, then it is easy to earn profits in CFD trading.

Trading Lounge is an online trading, analysis and education service that offers services such as Day Trading – cfd trading strategies, Trading Strategies, Technical Analysis, and How to Trade advice by a reputable and experienced trading coach.tradinglounge.com was started by Peter Mathers in 1982 to meet the growing demand of accessible and sensible education in online trading.
forex trading- Find the Best Broker

forex trading- Find the Best Broker

A stock market trading plan will not guarantee your success in the markets, but a good plan will enable you to work methodically toward your stock market trading goals while reviewing on a regular basis what is working and what is not. It will act as a roadmap for your trading journey. It will enable you to respond positively and constructively no matter what happens with your individual trades. And, most importantly, it will help you control the only thing a trader can control: his or her own actions.

Finally, stock market trading is a business. It can be a fascinating and sometimes thrilling business, but in the end it is a business. A trading plan helps you treat it as a business.

Successful stock market trading begins with a winning trading plan. It’s as simple as that. If you develop a well-conceived trading plan to guide your actions in the stock market you will already have the advantage over most of your market competition. Put simply, it gives you the edge you need to win over the long haul when trading the stock market or forex market.

Finally, stock market trading is a business. It can be a fascinating and sometimes thrilling business, but in the end it is a business. A trading plan helps you treat it as a business.

Here are some important elements of a trading plan.

1. Why am I trading? What are my goals?

The answers to these questions might seem obvious, but they usually are not. Take some time to ask them of yourself, and seriously consider the answers. You may be surprised by what you learn. And whatever the answers, you will have a clearer picture going forward of what this enterprise means to you, and that will help you survive any rough patches.

2. What markets am I going to trade and why?

It is often best to specialize, especially for beginning stock market traders. Many pros make a great living trading the same stock day every single day for years. Choose a market that is appropriate for your experience level and trading style. Consider other factors such as available margin, volatility and liquidity.

3. What is the concept or philosophy behind your trading methodology?

Your trading system must have a concept behind it. Whether you are a value investor like Warren Buffet or a trend trader like George Soros, you should understand why you are doing what you are doing, how your beliefs about the markets define what you will do as a trader.

4. What will be your specific method?

In other words, specifically how will you execute your trading ideas? Will you buy breakouts or pullbacks? Buy oversold or sell overbought? Or will you use specific technical setups such as moving-average crossovers or another indicator-based strategy? Under exactly what conditions will you enter? When will you know to exit?

5. How much money will you risk on any single trade? On trading in general?

This is critical. Of course, start small. But just as importantly, have a plan in place for how much you will risk, emotions don’t cloud your judgment when the time comes. The key is to find an allocation that doesn’t cause any stress but still makes the trade worthwhile financially. One of the biggest problems with newer traders is that they are trading way too big in relation to their account size. Like when you are forex trading. Trading forex at 100-1 leverage is like introducing your mistress to your wife. Yes, you can do it, but that doesn’t make it a good idea. Normally they don’t get along too well.

6. What will my trading rules be?

This is also critical. Your trading rules include entry and exit rules, rules governing maximum daily, weekly or monthly losses, maximum risk on any given trade, the maximum number of trades per week, etc., etc. These rules enforce discipline and keep you out of trouble. What stock price will enter at, what stock price will I will exit. Be discplined.

7. How will I record and evaluate my trading performance?

Allow me to repeat myself: This is critical. In fact, this might be the most important element of trading for new traders in the stock market. A new stock market trader who evaluates his trades, winners and losers, in an effort to learn what works and what does not, will make quantum leaps forward in terms of ability and profitability. If you have a working trading plan and evaluate every single one of your trades after you have closed it you have already beaten 95% of the competition.

8. What are my rules for managing profits?

What’s the problem with profits? Well, believe it or not there is one, and it’s a serious one. It’s called euphoria, and it clouds the judgment perhaps more than any other emotion related to trading. Start piling up the profits for the first time and it won’t be long before you are convinced you are king of the world. About 30 seconds later you’ll be broke, following a series of unwise and exceedingly risky trades. So have a plan for protecting closed profits when you have reached your goals for the week or the month. Don’t give them all back.

9. How will I reward myself for following my trading plan?

Don’t leave this out. Following your trading plan will bring rewards in the form of profits, but you should also consciously reward yourself for doing so because it is such an important part of successful trading. So if you finish the week or the month (or even the day) without having broken any of your trading rules, find a way to reward yourself. You deserve it. You are in rare company.

If you follow your plan you are improving your chances of becoming sucessful stock market or forex trader.

Happy Trading

About the Author

CFD FX Report is a real time tool for clients with an interest in the trading of stocks, indices and commodities globally.CFDs (Contracts For Differences) are one of the worlds’ fastest growing trading instruments that allows clients to profit from a rising and falling market. The CFD FX Report is a company comprising of expert traders that analyse the market daily and are able to make recommendations for the following day trades based on this analysis. The CFD FX Report is released everyday at 6.30 p.m. (Singapore time) for review by the clients for the next trading day.

We provide sms and email service for our trade ideas as well as full member support. The trading tool that traders needs. Free 1 week trial

A stock market trading plan will not guarantee your success in the markets, but a good plan will enable you to work methodically toward your stock market trading goals while reviewing on a regular basis what is working and what is not. It will act as a roadmap for your trading journey. It will enable you to respond positively and constructively no matter what happens with your individual trades. And, most importantly, it will help you control the only thing a trader can control: his or her own actions.

Finally, stock market trading is a business. It can be a fascinating and sometimes thrilling business, but in the end it is a business. A trading plan helps you treat it as a business.

Here are some important elements of a trading plan.

1. Why am I trading? What are my goals?

The answers to these questions might seem obvious, but they usually are not. Take some time to ask them of yourself, and seriously consider the answers. You may be surprised by what you learn. And whatever the answers, you will have a clearer picture going forward of what this enterprise means to you, and that will help you survive any rough patches.

2. What markets am I going to trade and why?

It is often best to specialize, especially for beginning stock market traders. Many pros make a great living trading the same stock day every single day for years. Choose a market that is appropriate for your experience level and trading style. Consider other factors such as available margin, volatility and liquidity.

3. What is the concept or philosophy behind your trading methodology?

Your trading system must have a concept behind it. Whether you are a value investor like Warren Buffet or a trend trader like George Soros, you should understand why you are doing what you are doing, how your beliefs about the markets define what you will do as a trader.

4. What will be your specific method?

In other words, specifically how will you execute your trading ideas? Will you buy breakouts or pullbacks? Buy oversold or sell overbought? Or will you use specific technical setups such as moving-average crossovers or another indicator-based strategy? Under exactly what conditions will you enter? When will you know to exit?

5. How much money will you risk on any single trade? On trading in general?

This is critical. Of course, start small. But just as importantly, have a plan in place for how much you will risk, emotions don’t cloud your judgment when the time comes. The key is to find an allocation that doesn’t cause any stress but still makes the trade worthwhile financially. One of the biggest problems with newer traders is that they are trading way too big in relation to their account size. Like when you are forex trading. Trading forex at 100-1 leverage is like introducing your mistress to your wife. Yes, you can do it, but that doesn’t make it a good idea. Normally they don’t get along too well.

6. What will my trading rules be?

This is also critical. Your trading rules include entry and exit rules, rules governing maximum daily, weekly or monthly losses, maximum risk on any given trade, the maximum number of trades per week, etc., etc. These rules enforce discipline and keep you out of trouble. What stock price will enter at, what stock price will I will exit. Be discplined.

7. How will I record and evaluate my trading performance?

Allow me to repeat myself: This is critical. In fact, this might be the most important element of trading for new traders in the stock market. A new stock market trader who evaluates his trades, winners and losers, in an effort to learn what works and what does not, will make quantum leaps forward in terms of ability and profitability. If you have a working trading plan and evaluate every single one of your trades after you have closed it you have already beaten 95% of the competition.

8. What are my rules for managing profits?

What’s the problem with profits? Well, believe it or not there is one, and it’s a serious one. It’s called euphoria, and it clouds the judgment perhaps more than any other emotion related to trading. Start piling up the profits for the first time and it won’t be long before you are convinced you are king of the world. About 30 seconds later you’ll be broke, following a series of unwise and exceedingly risky trades. So have a plan for protecting closed profits when you have reached your goals for the week or the month. Don’t give them all back.

9. How will I reward myself for following my trading plan?

Don’t leave this out. Following your trading plan will bring rewards in the form of profits, but you should also consciously reward yourself for doing so because it is such an important part of successful trading. So if you finish the week or the month (or even the day) without having broken any of your trading rules, find a way to reward yourself. You deserve it. You are in rare company.

If you follow your plan you are improving your chances of becoming sucessful stock market or forex trader.

Happy Trading

About the Author

CFD FX Report is a real time tool for clients with an interest in the trading of stocks, indices and commodities globally.CFDs (Contracts For Differences) are one of the worlds’ fastest growing trading instruments that allows clients to profit from a rising and falling market. The CFD FX Report is a company comprising of expert traders that analyse the market daily and are able to make recommendations for the following day trades based on this analysis. The CFD FX Report is released everyday at 6.30 p.m. (Singapore time) for review by the clients for the next trading day. We provide sms and email service for our trade ideas as well as full member support. The trading tool that traders needs. Free 1 week trial

CFD FX REPORT we help you find the best online broker, free forex report. Find out now who the best broker is

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Advantages of CFD Trading for investors

Advantages of CFD Trading for investors

Nowadays, companies are getting benefited from trading in CFDs (Contracts for difference). Infact, CFD trading has become very popular among the traders these days. There has been a lot of innovations and developments in CFDs with time. It is considered as one of the major investment tool which has lot of advantages for the companies. It also offers several opportunities from commodities, stocks, bonds, indices and foreign exchange. Let us know what are the advantages of this trading method to the investors? Typically, there are 4 major advantages of CFD trading in market.

Margin Trading

Trading through margin is one of the main features of CFD trading. This means, CFD can be bought or sold by the investors simply by investing a small capital. This is very advantageous for small investors and companies having small capital for investment. Thus by using this instrument, they can have a high leverage.

Investment Diversification

CFD trading is also helpful for big companies and investors as it provides them an opportunity to diversify their investment. Well, this is because companies will need only a small amount of capital to be invested to other baskets. Actually, most of the big companies find investment diversification a big challenge due to the requirement of capital. If they have to seek investment diversification, they will have to distribute their funds to different investments. Therefore, as a result, they may end up missing on few opportunities simply because their capital investment will be stuck somewhere else.

Hedging tool

CFD trading also serves as a hedging tool for companies for hedging the risk that may occur on some instruments. This is possible because their investment portfolio will be more diversified than ever.

Flexibility

CFD trading also provides flexibility to both big and small companies. This is because they will be able to trade and invest on a wider scale of opportunities with only a small capital. They will not be refrained from investing to something simply because they are stuck somewhere else.

Trading Lounge is an online trading, analysis and education service that offers services such as Day Trading – CFD Trading, Trading Strategies, Technical Analysis, and How to Trade advice by a reputable and experienced trading coach. www.tradinglounge.com.au was started by Peter Mathers in 1982 to meet the growing demand of accessible and sensible education in online trading.

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