Essential Elements of a Successful Trader

[شريف دعبس]

كل عام وانتم بخير

Essential Elements of a Successful Trader

.fullpost{display:inline;} Courage Under Stressful Conditions When the Outcome is Uncertain

All the foreign exchange trading knowledge in the world is not going to help, unless you have the nerve to buy and sell currencies and put your money at risk. As with the lottery “You gotta be in it to win it”. Trust me when I say that the simple task of hitting the buy or sell key is extremely difficult to do when your own real money is put at risk.

You will feel anxiety, even fear. Here lies the moment of truth. Do you have the courage to be afraid and act anyway? When a fireman runs into a burning building I assume he is afraid but he does it anyway and achieves the desired result. Unless you can overcome or accept your fear and do it anyway, you will not be a successful trader.

However, once you learn to control your fear, it gets easier and easier and in time there is no fear. The opposite reaction can become an issue – you’re overconfident and not focused enough on the risk you're taking.

Start by analyzing yourself. Are you the type of person that can control their emotions and flawlessly execute trades, oftentimes under extremely stressful conditions? Are you the type of person who’s overconfident and prone to take more risk than they should? Before your first real trade you need to look inside yourself and get the answers. We can correct any deficiencies before they result in paralysis (not pulling the trigger) or a huge loss (overconfidence). A huge loss can prematurely end your trading career, or prolong your success until you can raise additional capital.

Both the inability to initiate a trade, or close a losing trade can create serious psychological issues for a trader going forward. By calling attention to these potential stumbling blocks beforehand, you can properly prepare prior to your first real trade and develop good trading habits from day one.

The difficulty doesn’t end with “pulling the trigger”. In fact what comes next is equally or perhaps more difficult. Once you are in the trade the next hurdle is staying in the trade. When trading foreign exchange you exit the trade as soon as possible after entry when it is not working. Most people who have been successful in non-trading ventures find this concept difficult to implement.

For example, real estate tycoons make their fortune riding out the bad times and selling during the boom periods. The problem with trying to adapt a 'hold on until it comes back' strategy in foreign exchange is that most of the time the currencies are in long-term persistent, directional trends and your equity will be wiped out before the currency comes back.

The other side of the coin is staying in a trade that is working. The most common pitfall is closing out a winning position without a valid reason. Once again, fear is the culprit. Your subconscious demons will be scaring you non-stop with questions like “what if news comes out and you wind up with a loss”. The reality is if news comes out in a currency that is going up, the news has a higher probability of being positive than negative (more on why that is so in a later article).

So your fear is just a baseless annoyance. Don’t try and fight the fear. Accept it. Have a laugh about it and then move on to the task at hand, which is determining an exit strategy based on actual price movement. As Garth says in Waynesworld “Live in the now man”. Worrying about what could be is irrational. Studying your chart and determining an objective exit point is reality based and rational.

Another common pitfall is closing a winning position because you are bored with it; its not moving. In Football, after a star running back breaks free for a 50-yard gain, he comes out of the game temporarily for a breather. When he reenters the game he is a serious threat to gain more yards – this is indisputable. So when your position takes a breather after a winning move, the next likely event is further gains – so why close it?

If you can be courageous under fire and strategically patient, foreign exchange trading may be for you. If you’re a natural gunslinger and reckless you will need to tone your act down a notch or two and we can help you make the necessary adjustments. If putting your money at risk makes you a nervous wreck its because you lack the knowledge base to be confident in your decision making.

Patience to Gain Knowledge through Study and Focus

Many new traders believe all you need to profitably trade foreign currencies are charts, technical indicators and a small bankroll. Most of them blow up (lose all their money) within a few weeks or months; some are initially successful and it takes as long as a year before they blow up. A tiny minority with good money management skills, patience, and a market niche go on to be successful traders. Armed with charts, technical indicators, and a small bankroll, the chance of succeeding is probably 500 to 1.

To increase your chances of success to near certainty requires knowledge; acquiring knowledge takes hard work, study, dedication and focus. Compile your knowledge base without taking any shortcuts, thereby assuring a solid foundation to build upon.

[شريف دعبس]

Pendekar Forex: Forex eBook

[Dr_mahmoud]

كل عام والجميع بخير

[شريف دعبس]

Forex Trading & The Science Of Getting Rich

.fullpost{display:inline;} I first became aware of “the science of getting rich” a number of years ago when someone sent me a reprint of a book of that name by Wallace Wattle.

The book is a very “dry” read but the author claimed that getting rich was an exacting science which means that if anyone applied the rules – to the letter, then the outcome, by scientific definition, would be a true replication.

In other words, if one were to apply the rules of “the science of getting rich”, one would inevitably become rich.

In many ways, not dissimilar to applying a trading system that is proven to work, provided the user applies the system rules exactly, then the same success should be replicated time and time again.

You will recall – unless you have been trading Lunar Currencies (joke) – that we recently had a liquidity problem in the markets brought about by the meltdown in the sub-prime mortgage market.

In “the science of getting rich”, Wallace Wattle points out the necessity of generosity. In fact he states that one must give freely and although I may be slightly misquoting he suggests that “one should never miss the opportunity to give”.

It is a fact that almost all successful people give away money. I know that this may sound unlikely but check it out.

Warren Buffett has pledged to gradually give 85% of his Berkshire stock valued at around $40 million to five foundations. A dominant five-sixths of the shares will go to the world’s largest philanthropic organization, the $30 billion Bill & Melinda Gates Foundation. Yes that’s right, Bill Gates of Microsoft fame gives away very large amounts of his fortune to charitable causes. Warren Buffett and Bill Gates are far from being alone in giving away money.

Perhaps wealthy people understand more than most that the cycle of money must be kept in motion. You need to give to receive.
So what do “the science of getting rich” and forex trading have to do with each other?

In my opinion, rather a lot!

As we saw with the credit crunch, when money stops flowing, it causes a ripple effect that increasingly affects more and more people. As long as the money flow continues, there is opportunity for all, but when it stops, there is nothing but trouble ahead.

With the act of giving, according to “the science of getting rich”, one is perpetuating the mental attitude of plenty. In essence you are in the mind set of “I have plenty so I can give freely with the full expectation that I will receive even more”.

Being in the right mind set is a very important part of becoming a successful trader.

It is rather like “Trading in the Zone” (an excellent book on trading attitude by Mark Douglas). When you are in the mentality of winning, you carry on winning, but when you are in the mentality of “lack” you are just waiting for failure, which surely will come along.

If you would like to dynamically improve your trading there are a number of things you might consider, and these could include making sure that you have a well proven trading system, making sure that you are always in the “right” mind set when trading and being prepared to “pass on” some of you winnings to a good cause.

[شريف دعبس]

Knowledge and Confusion

.fullpost{display:inline;} I've learned for myself, and seen it in many others, that the more they or I learn and then try to apply, the more confused we can become.

To me, this doesn't mean that we have to stop learning or reading books or investigating new methods. What it does mean is that it's important to separate the learning process from the application of the learning. I make the analogy that trying to follow multiple trading systems can be like trying to drive a car with multiple steering wheels. It just won't work. It becomes confusing and it's overcomplicated.

The statemens about stepping back and having an open mind, and about you having to learn for yourself, that was quoted in this thread, are so very true in my experience. Through your own observations, and open-minded (so well put!) interaction with new ideas, and reading, etc, you are going to get an idea of what indicators or methods make the most sense to you.

And then you have to do more than observe -- of course this is my opinion and I am excited to hear what others have to say -- then you have to test the methods that you learn. You go back in time and you apply what you have learned and you prove whether it works or not. You learn whether the method experiences drawdowns that are unnacceptable, or whether it has a great win percentage but a bad average winner to loser size, or whether it requires you to keep an unrealistic schedule that negatively affects your health. This process of learning, making a hypothesis, and then testing that hypothesis, can take a long time. That's why so many traders fail, I think: they realize how much effort can go into "making a system your own" and instead they just start trading again, because of financial pressures, an addiction to trading, or because they simply feel that all that testing is unnecessary.

Once that learning and testing process is complete, you start applying what you've tested in the market. Do you get the same results? Or are they not what you expected based on your testing? You can share your results with a friend or mentor or spouse or people at FF -- someone who cares about your success. They can hold you accountable to apply what you have learned and tested in a disciplined way, and then they can help you stop trading if it's not working, or encourage you to be confident and continue to take the necessary risks associated with trading if the system is working.

All throughout this process, you are emphasizing learning and testing, and making a system "your own", and you are de-emphasizing lots of trading, you are reducing stress about whether you are doing it "right", you are proving to yourself that you can learn and test and implement.

And then as you implement a system that you have made your own, and you are profitable, you can repeat the process with more learning, more testing, and so on. It can be a continuous process that lasts a lifetime.

To bring it full circle, hopefully, one helpful thing for me (which I have seen with others) is that they focus their learning on one or two things at a time, then test, then implement, then hold themselves accountable to others and themselves. And this reduces the confusion associated with looking at so many things, so many systems, so many methods, and not "knowing what to follow."

[شريف دعبس]

Who am I?

I am a traders, just like you.
I have full time jobs, just like you.
I have a family to take care of, mortgages to pay, and countless other needs to attend to.

I am a part-time traders that set aside a few hours of the Forex trading day, trying to make a few pips here and there


Trading

• - Trading gives us lessons not only about what to do or not to do next time in a trade, but also life lessons about personality traits that could improve the rest of our lives too - if we are willing to work on them
• All through time, people have basically acted the same way in the market as a result of greed, fear, ignorance and hope - that is why the numerical formations and patterns recur on a constant basis.
• - What does your trading journal look like - or do you not have one? It is critical to keep a trading journal. Yet statistics show that 97% of people do not have written goals, so why would a written journal be much different?
• - It's not about trading EVERY day, it's about trading that ONE RIGHT DAY......You make money by waiting, not by trading. Sounds so silly nobody wants to believe it, but it's true
• - Patience. Let the market come to you
• - I would rather miss a good trade then be in a bad one.
• - The 90% problem: Over 90% of traders focus over 90% of their efforts into tweaking indicators, of which over 90% use some form of a moving average, and over 90% use the close price as their only input data. Not only that, but over 90% of traders don't really understand how the indicators they are tweaking work. Should it be any wonder that over 90% of traders fail?
• - If you use more indicators than articles of clothing you wear on an average day, then something's wrong with your trading.
• - A primary rule to achieving success in trading is that you have to have a plan. If you want to succeed as a trader you have to have a clearly defined plan and you absolutely cannot break your rules under any circumstances
• - Very important principle that all professional traders live by and amateurs ignore. If you focus on handling losses, profits will take care of themselves
• - Never buy into motion. The reason is you see the motion and get excited and buy/sell and then want to decide what the plan should be. You must allready have a plan before you open a position
• - "I'd rather be "out" of a trade and wishing I was "in" than "in" a trade and wishing I was "out"

Forex is a risky business.
You will lose money.
There is no perfect system.
You cannot, ever, predict the market.
Your emotions will get involved as trades move up and down
There is no such thing as bad margin as a universal law
The market isn't moved by rational reasons
More information will not necessarily help you become a profitable trader
What we see on the charts -- the market -- is simply a reflection of our own beliefs about the market.

Do One Thing Right

Traders do better when they try to do one thing perfectly right. Traders do worse when they spread themselves too thin, between many indicators, financial instruments, time frames, and trading systems.
Do less. Focus more. You'll do everything better.
It doesn't matter how often you are right or wrong - it only matters how much you make when you are right versus how much you lose when you are wrong.

LIFE

• Semua hal yang berharga dalam hidup kita gratis apa adanya: pikiran, jiwa, badan, harapan, impian, ambisi, kepintaran, cinta terhadap keluarga, anak dan negara, semua milik kita yang tak ternilai, cirinya: gratis!
• Success is not the key to happiness. Happiness is the key to success. If you love what you are doing, you will be successful
• - Yesterday is so far in the past I can't see it; tomorrow is too distant in the future to be seen.So I'll take a good look at what I can see - TODAY
• - Life is a puzzle consists of simple pieces.Find the right ones & make beautiful pic out of them

[شريف دعبس]

Forex eBook

[شريف دعبس]

A.J. Frost & Robert Prechter - 34 Elliot Wave Lessons
Alan Farlay - Pattern Cycles.pdf
- The Amazing Hidden Powers of Japanese Candlesticks

[شريف دعبس]

.:: Mundo Forex :: Forex World :: Home ::.

[محمدالمصرى]

مبروك يا شريف باشا اللغات
كتب أكثر من رائعة يا باشا

معندكش عربى ؟ !!