If you don't know who you are, the market is an expensive place to find out.
Quote: George Goodman Afaik
10 Steps To Success
1) Knowledge Acquisition Great traders are voracious learners. Most professional occupations have a learning curve. Doctors, lawyers, criminals, etc.. often study years to refine their craft. Novice traders often believe they are immune to such time intensive studies. Don't fall prey to such ignorance - study the markets, put in serious chart time, read and learn from those that are winning.
2) Money Management This one is simple. Trading more then 2-5% of your account on any one trade is account suicide. Let's assume you start out trading a $1000.00 mini-account. Your system has a 30 pip stop loss. The maximum you should risk on any one trade is a dollar per pip. The market will forgive a lot of things - bad trades, bad days even bad weeks but without the capital to withstand the drawdown your trading career with be short lived.
3) Simplistic Strategy Have you ever noticed Forex scam sites often provide a unique system that only they have? Additionally - these systems are only known by a hand full of successful traders. Your system should do just the opposite. I use pivot points, psychological levels and trend line breaks because large institutions follow these levels. As a retail trader your goal should be to pick up the pennies in front of the steam rollers. Keep Occam in mind when adopting any trading system. Leave the over complicated systems to the guys at Long Term Capital.
4) Trade During Prime Time One of the biggest benefits of the currency markets is its hours. It's open 24 hours a day 5 days a week. This is great for trend analysis but not for trading. Don't let these extended hours fool you. Only the biggest players trade during the prime hours... so should you. Keep in mind that only 14% of all trades occur outside of non-financial institutions. That's where the retail trader lives. Since we only trade the EURUSD we only trade between 2:00am and 11:00am EST. This time period covers the European open and close, the open of the US session and the overlap between the US session and the European session.
5) Follow Your Trade Plan You don't know where the market is headed. Don't guess. Hope isn't a strategy. Once you adopt a trading strategy that fits your trading style stick to it. Leave your ego at the door when you begin your trading day. This is one of the most difficult things to overcome. The old adage plan your trade and trade your plan is very important. When you trade outside your plan you will lose.
6) Double Your Demo Account Almost every Forex trading platform offers demo accounts. When you can double your demo account you are ready to trade real capital. Additionally - after your double your demo account trade the first few months of you real capital using micro-lots where each pip equals a small dollar amount. This will help ease the emotional impact of trading real capital.
7) Trade with the Trend All those little axiom's about the trend exist for a reason - the trend is your friend... trade with the trend until it bends... trade the trend or lose in the end - you get the idea. These exist for a reason. They are true. Use long term trend analysis to determine market direction. When you trade with the trend your chances of success are greatly enhanced.
8) Set Realistic Expectation What's realistic? If you can return 5-8% a month you are doing great. While this may seem like a relatively small goal very few traders can achieve this month after month. If you set unrealistic goals - say 20% a month you better be sitting beside John Arnold because that's about the only way your going to see that kind of return.
9) Post Trade Analysis When the trading day is over take a few minutes to analyze what happened. Did you follow your trading plan? Was your analysis accurate? Why? Why not? At the end of the week spend some quality time looking over the trades you placed during the previous week. How many trades did you take? Are you over trading? Many traders find it advantageous to keep a journal of their trades and their thought process for taking or not taking the trade. In a very short time you will see patterns emerge that will aide you in fine tuning your trading.
10) Predetermined Profit Targets and Stops Setting your stop loss is a must. Intra-day traders usually use a 20-40 pip stop. After you've adopted a system and spent hours watching the chart you will know where your stop should be. Once you've settled in on a stop never move it. One more time - never move your stop! Remember that capital accumulation is secondary to capital preservation. On the other side of the equation set profit targets prior to entering your trade. Utilizing pivot points will always provide you with realistic profit targets.
Source : http://www.thefxpivotpoint.com/10StepsToSuccess.htm
Trade Your Way to Financial Freedom
Read this book
The single most important book I've ever read is Trade Your Way to Financial Freedom by Van K Tharp. The two most important parts of this book are on expectancy and position sizing. Read this book. Successful traders apply the insights Van details in this book with laser focus. Highlight it and then read it again. It will make you a better trader.
We aren't the only ones who believe this is a masterpiece. Ed Seykota (a trading legend) called this book, "one of the three best ever written." If anyone reading this knows Ed please have him forward me his other two recommendations. Change what you think you know about trading and pick up this book. You can buy it new for under $20 on Amazon. If this book doesn't change how you trade then read it again - you missed something.
History
in one sense history never repeats itself since the same set of variables are never lined the same way twice
Sites You Might Like
baybpips.com
If you're a beginner or just need a refresher on the basics this is the first place you need to go. I love the featured lesson section of the site's home page. The site design is very intuitive. You can download written lessons for a small fee.
I use this site everyday. The releases are the first thing you see once the site paints. To the right of the releases is a button labeled Impact. The color determines the potential the release has for moving the market. On the right hand side of the page is the Forex News. There are a variety of contributors and the majority of their market insights are very useful. This is the site I frequent the most.
Great FX market prowess. The main experts are Kathy Lein and Boris Schlossberg - both are very good at what they do. I read their reports all the time. Additionally - the other authors are great technical traders. I like Jamie Saettele's technical writings.
From a design standpoint this site is horrible. They attempt to put every piece of information they can on their home page. However, the content is very, very good. They have great guest traders and Rob Booker's trading methodology and insights are inline with my trading philosophy. Their resident speakers are also excellent.
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