A Must-See Music Video for Every Trader

If you struggle to come to grips with the fundamentals of the market, then have a look at this video. There's more to trading then watching two lines cross-over on a chart. There's a reason for the music of the markets. The music video was produced by Michael O'Rorke of Columbia Business School's Follies.

The Holy Grail of Technical Analysis

Q. What does a trader do when they apply to a chart all the indicators they've spent their hard-earned money learning about?

A. They flip a coin and use money management!

Live FX Prices

Live Equity Prices

Free Resource - Currency Trader Magazine

My trading focus since last year has been primarily on the futures commodity markets and currencies. A free monthly magazine for those interested in foreign exchange markets is Currency Trader Magazine. It includes tests on the performance of different indicators and also addresses current fundamental factors that may be moving currency pairs. Once you subscribe to the magazine, they allow you to download the current issue and just the previous issue.

Read the magazine for free before someone tries to sell you the same information by stealth as an ebook.

Free Resource - The Trading Naked Web Site

Here's a web site that will keep you busy with plenty of straight-to-the-point advice, and it's free: http://www.trading-naked.com/Setups.htm

I've directed your attention to this trader's discussion about trading setups - when is the right time to enter a trade?

I have experienced the frustration he describes, and heartily advocate his conclusions, for example: "You only need to master one setup to be a consistently profitable trader. "

I've found trading regularly using one primary indicator gives me better results than doing very little, waiting for all the planets (indicators) to line-up.

Get in there and get dirty and learn, you won't learn trading by reading, you gotta trade to learn how to trade.

Free Resource - Stocks, Futures and Options Magazine

You might as well access free information where you can, it's often as good as paid subscriptions, the trick however is to READ IT.

You can sign-up for free online access to the Stocks, Futures and Options Magazine here: http://www.sfomag.com

Click on the Subscribe button, then click on the Online Subscription option and follow the prompts.

Have a look, there are good articles in SFO magazine.

2006 - How are you doing?

Well, we're hurtling towards the end of the first quarter of the year, and it wasn't that long ago that a lot of us were thinking about what we would like to achieve for 2006.

How are you doing so far?

When we are learning a new skill like trading or we want to change our mindset over an old habit we no longer wish to possess, it is virtually impossible to become a master or to change that habit overnight.

We are required to practice and hone our new skill level. Especially when changing non serving beliefs and habits, it is so very easy to slip back into the ‘Old Way’ of thinking or doing.

I just wanted to remind you, to not give yourself a hard time if you see yourself slipping back or failing to master a new skill set fast enough. Instead “Keep Your Focus” on the end result by reminding yourself at least daily about what it is you want to achieve.

Keep your focus!

Higgins knew how to wax on, wax off.

Here's a story that might help you with your trading:

There was a 10-year-old boy who decided to study judo despite the fact that he had lost his left arm in a devastating car accident. The boy began lessons with an old Japanese judo master.

The boy was doing well, so he couldn't understand why, after three months of training, the master had taught him only one move. "Sensei," the boy finally said, "Shouldn't I be learning more moves?" "This is the only move you know, but this is the only move you'll ever need to know," the sensei replied. Not quite understanding, but believing in his teacher, the boy kept training. Several months later, the sensei took the boy to his first tournament. Surprising himself, the boy easily won his first two matches. The third match proved to be more difficult, but after some time, his opponent became impatient and charged; the boy deftly used his one move to win the match. Still amazed by his success, the boy was now in the finals.

This time, his opponent was bigger, stronger, and more experienced. For a while, the boy appeared to be overmatched. Concerned that the boy might get hurt, the referee called a time-out. He was about to stop the match when the sensei intervened. "No," the sensei insisted, "Let him continue." Soon after the match resumed, his opponent made a critical mistake: he dropped his guard. Instantly, the boy used his move to pin him. The boy had won the match and the tournament. He was the champion.

On the way home, the boy and the sensei reviewed every move in each and every match. Then the boy summoned the courage to ask what was really on his mind:

"Sensei, how did I win the tournament with only one move?" "You won for two reasons," the sensei answered. "First, you've almost mastered one of the most difficult throws in all of judo. And second, the only known defence for that move is for your opponent to grab your left arm." The boy's biggest weakness had become his biggest strength.

----

One market, one pattern and win.

What's your one thing for 2006?

See where wax on, wax off gets you!

TRADING GURU - Mark Douglas

"Trading in the Zone" Book Review

Don't get me wrong, I like Mark Douglas and I like the ideas in his book Trading in the Zone. The big problem I had with his book however was just getting through its 200-odd pages of turgid waffling. I read a lot of books and some are a breeze to read, but this book is as painfully slow as the Dow Jones Industrial Average on a Sunday afternoon.

I wondered if this book was a transcription of a talk, with the constant restating of the same ideas using different words so that I would "get it," like you might hear in a lecture. OK Mark, I GET it! Next Point!

Enough with the complaining. If you have trouble pulling the trigger, have been burned by a string of bad trades or are thinking of looking for another career or hobby then Mark's book is worth looking at.

It's not until the end that you get to the meat of the book, and there you get a practical implementation of his 5 principles of the market, which helps you approach the market from a realistic perspective:

1. Anything can happen.
2. You don't need to know what is going to happen next in order to make money.
3. There is a random distribution between wins and losses for any given set of variables that define an edge.
4. An edge is nothing more than an indication of a higher probability of one thing happening over another.
5. Every moment in the market is unique.

So just because you might have a string of losses in a row does mean that the next trade will also be a loss.

Mark gives you a trading plan to follow to help put the 5 principles into practice and this practical application of the principles is what makes this book worth the effort.

Unfortunately, Mark doesn't include all the record-keeping aspects that are necessary with implementing a trading-plan, so please beware that he isn't giving you a complete trading system, however he is focusing on one important aspect - the mind.

So, if you've been battered by the markets or are frightened by the prospect of losing any money while trading then have a look at Trading in the Zone.

Numb Trader Steps Outside

Trading Course Scams

This tosser is a model, not a trader.

If you see advertisements for trading courses that emphasize how great it would be to work from the home or the beach or go on and on about becoming financially independent, then IT IS A SCAM.

What do I mean by a scam?

A scam deprives you of your money through deceitful advertising. These ads (in brochures, TV or Web sites) sell a dream, but the reality of trading is quite different. To trade successfully, you need to be disciplined all the time and that's not what they tell you. Because trading requires taking on new habits it therefore doesn't suit everyone.

So don't be swayed by stupid pictures of people "working" from a yacht or the beach.

Marketing-hype gives you a false impression of what it takes to succeed at trading. What happens to MOST people who fork-out hundreds or thousands of dollars for such courses is that as soon as they get home and start paper-trading, they soon discover how much work is involved and give up. I've seen it happen many times!

That's why these advertisements are fraudulent. They're not telling you what trading really involves. As it turns out, most of the really useful information they give you in these courses you can easily get for free from books at the local public library or from the internet.

Marketers get your hopes up and make you think that THEY have the key that will make trading profitable and easy. But that's not what happens. They make your wallet lighter but they don't make trading any easier.

Are any courses worth it?

The courses that are worth paying for are those that offer you on-going assistance to help you learn the discipline of trading their system, long after you've completed their course or downloaded their ebook.

Do they offer to answer any questions you have for at least the next 12 months? If not, then I wouldn't buy it.

If they have an online or local support group or chapter trading their system then that's even better. If you can get-together with like-minded people and more seasoned traders who are willing to assist you in your quest to become a disciplined trader then you are more likely to succeed.

If a company is not willing to nurture you and take responsibility for what they're selling, then this indicates to me that they only want a quick-sale by selling a dream. They're not teaching you to become a good, disciplined trader.

Caveat Emptor! - Let the buyer beware!

Trading Currencies, Commodities, Indices, Stocks and Options

This blog will be where I'll post things that I've come across and use to be a numb trader. No pain, no euphoria, just numb trades.