This. Is. HUGE! Such a tremendous honor as this signifies that the quality of this article is truly excellent. Now to keep it up.
“The bad news will always get the headlines, but headlines don’t make you money. You get better as an investor when you listen to the tape and follow the strength. The headlines will get bullish after huge gains are made.”
Howard Lindzon » Blog Archive » Finally..a Continuation in the ‘Inconceivable’ Rally
This is golden. And true in any market.
“A well-managed business pays high wages and sells at low prices. Its workmen have the leisure to enjoy life and the wherewithal with which to finance that enjoyment.”
— Henry Ford, 1914
Found this gem of a quote in Umair Haque’s article “A Deeper Kind of Joblessness”. It is so funny how business schools teach you costs costs costs. Here is an entrepreneurial innovator saying people people people.
“The ego is not your friend… The ego wants to be right, it wants to predict, and it wants to know secrets. The ego makes it much more difficult to trade well by avoiding the cognitive biases that hinder profits.”
— Curtis M. Faith
(via The Kirk Report : Justification Mode)
This article was retweeted all over StockTwits today before I finally read it. A great read that gave way to thoughts about my own trading. So to be blunt:
Summer chop is hard to trade
2010 has been nicer than 2009 but I’m not pleased when I look through my journal. After a great 1H 2010 - in which I stuck to my trading plans more, traded well, and seized opportunities, I can see how coming into July my ego got stoked enough to be loose with the rules. Respect the market by studying and taking the lowest risk opportunities.
Keep the probabilities in your favor
Losses have to be quick and small. “Keep it tight.” But what messes with my emotions is that those tight losses are taken more often. The focus on losses as numbers and not probabilities allows emotion to cause, over-trading at best and gambling at worst.
Patience is required. Entries have to be close enough to perfect. Smaller lot sizes on riskier entries. Take more off the table. Leave less to run. Break even stops. The idea is to be strict with both risk and profit. So I may be wrong more often but the losses are much smaller, allowing the winners to remain real winners.
Very timely article for me today.
My thoughts here are specific to my trading style and performance so let me know what works for you! Many fellow traders are doing well this year too both professionally and personally. We have all grown and prospered so much and I am always humbled to be trading and talking and tweeting with them. I’ve known traders on my stream for almost/over a year now. Our trading has certainly improved after last July. But oh what an interesting year :)
Hi Faith (I know that's not really your name, lol),
How long did you have to practice Forex before you went live? I don't know anything about currencies but I've been able to do OK virtually on just technical analysis. Do you think one can just do this based on TA? Finally, are you a career trader? That is my dream for retirement.
Thanks,
Mimi
Anonymous
Hey Mimi, thanks for your questions. Faith has become something like a pen name lol so no worries!
I went live 2 months after trading demo. And that was WAY TOO soon! I would never advise that. Inevitably, I blew up that account and several thereafter before putting down my ego and returning to demo. It wasn’t until I could really understand risk and how I use it and manage it in my trading before I could make the successful transition to real money trading.
There are many technical traders who do very well without the fundamentals. So can you be successful solely using technical analysis? ABSOLUTELY! As you trade you will learn the fundamentals and learn more about currencies, so just keep trading and staying disciplined to your rules. If you are successful doing what you do as you say you are, why change it? Too many times, we learn another’s approach because it works for that trader. So test new techniques in demo and if it doesn’t work TOSS IT. Most importantly, TRADE YOU! Much like the saying, “trade your style, not your mentor’s.”
I like your choice of “career” trader. Yes, I am a career trader. However, I am not yet a full-time trader. I think I am making a transition in that direction but I have interests and talents right now that I am blessed to do while trading. I’m enjoying life as it comes!
Best of everything for you in your trading :)
Lydia
“Let us move voluntarily into a robust economy by helping what needs to be broken break on its own, converting debt into equity, marginalising the economics and business school establishments, banning leveraged buyouts, putting bankers where they belong, clawing back the bonuses of those who got us here and teaching people to navigate a world with fewer certainties. Then we will see an economic life closer to our biological environment: smaller firms and no leverage - a world in which entrepreneurs, not bankers, take the risks, and in which companies are born and die every day without making the news.”
— Excerpt from New Statesman - Beware those Black Swans
Another discovery today. I’m sure many of you have already read this book. I’m adding it to my reading list!
“Genius is 1% inspiration and 99% perspiration.”
— Thomas Edison
This quote is truth and the inspiration motivation of an awesome think tank I just discovered. Thank you African Digital Art.
Keep grinding!
brit:
I am really psyched about TEDWomen, coming this December to DC in a two-day conference to focus on women from around the globe and their issues, innovations, insights, the whole shebang. Considering we’re talking about 50% of the population from around the globe - statistically slightly more, even - it’s sort of amazing and mouth-dropping that focusing on women is called “an emerging story,” but hey - TED calls it like it is, not like it should be. From the website:
Over the last several years, our ideas about women have changed. Investing in women and girls was once seen as a radical notion; today, its value is clear. A new lens reveals women as powerful change agents: In developing nations, women and girls hold the vital link to economic growth, public health, political stability. In the West, generations of educated women are forging new directions in the sciences, arts, business and beyond.
To track this emerging story, the first-ever TEDWomen will explore in depth: Who are the women who leading change? What ideas are they championing? How are they shaping the future? TEDWomen will also reveal how women and men, in concert with one another, orchestrate different but complementary approaches to ideas worth spreading.
The cross-disciplinary, cross-generational program will focus on how women think and work, communicate and collaborate, learn and lead—what this means and why it matters to all of us. Speakers from around the globe—from anthropologists to artists, scientists to soldiers, bankers to builders, farmers to futurists—will share their ideas in the world-renowned TED format, creating a program that surprises and inspires.
I’m already surprised and inspired. And excited. Will the dudes come? They should. Not only will it be a sweet pickup joint (ladies in the house holla!) but there is major money to be made off understanding the needs of 50% of the population - oh and also tapping into their brainpower. See you there, Fred Wilson!
- Via
- brit
Confessions of A Forex Trader
Greed
I got greedy last week. I admit it. But I didn’t start the week like that. Quite contrary, I approached the markets very humbly having wrongly made a bear call on the GBP/USD last week. But even in analyzing a bear case, I rightly saw the clear signals of the beginning of bull run that took price above 1.5250.
Moral of the story: Plan your trade.
Once the price break above 1.5250 happened, I traded the new trend that took price from 1.4946 to 1.5070 with very shallow retracements. I set targets very tentatively at all the resistance levels (1.5320, 1.5460, 1.55). A trade that developed the course of the week was increasingly profitable. Sounds good so far.
Moral of the story: Trade your plan.
But my ego allowed pips to blind me to the fact that I didn’t have a solid action plan for 1.55. I expected 1.55 would be met with resistance but failed to establish what I should actually do if I was still in a trade because my target was not achieved in addition to what I would do if my target was achieved. I needed to not only pay attention to that level but I needed to exit my trades after the first attempt at that level took prices below 1.5400.
Instead, greed told me that this was only a first failed attempt that would surely end with another successful assault at 1.55. This had been a strong rally all week, after all. Do you hear the insane sanity? Rational thought should have led to the conclusion that it had been a solid run all week and that 1.55 is a major half point level that would be met with resistance. And with resistance would come a correction so rather than looking for more longs, I should have exited my longs and looked where I could reset longs or go short for the correction. In addition, I set my limit too aggressively at 1.55 so my limit was missed by 30 pips.
My greed caused me to add to the trade rather than exit it. Now instead of sitting on a mountain of pips, I am having to manage now a loosing position.
Moral of the story: Don’t add to a position. Rather, build a position for a trade and manage that position until the trade is completed.
Please note that these rules and morals are specifically geared toward me and my performance last week. Please do trade what you see.
These 100 companies control the use of 25-40% of the earths 1… on Twitpic
So how do you compete? One idea is to form consortium of start-ups to medium-sized businesses that together can be much more influential and competitive as to sit amongst the companies in this group. Another idea is to have a consumer regulatory body instead of (in addition to) governmental regulation. Government regulation alone clearly has not been enough but can consumers really unite on that big of a level? Nonetheless. An interesting what-if. Tell us. What ideas have you heard of? What ideas to you have?
[Flash 9 is required to listen to audio.]
Follow Us
Big Boi & Vonnegutt
In honor of #FollowFriday, follow us:
My favorite of the collection. I LOVE that jacket and skirt combo. Cute shoes too.
(via .:OPÉStyle:.: Fashion Yummyness: Christan Dior Couture)
Intermission: Jimi Hendrix Plays the Star Spangled Banner at Woodstock - GOOD Blog - GOOD
Only a black man can play that song like that. The emotion is so raw, the love and pain for your country. AMAZING. Thanks Rick!
“Pros care very much about who is in the markets and why markets are moving. The principles provide a framework for making sense of market behavior, which then can be used to filter the setups provided by charts, cycles, and the like. The really good traders understand markets; they don’t just predict them.”
(via Thought of the Day… « 50’s Blog)
I read this as traders must look at fundamentals even if they don’t trade the news. 50 took it as traders must look at the charts and understand the different levels where flows could possibly change. Two different takes and both right depending on your trading style. I love the differing perspectives.
This is so so SO true. Probably why I love currency trading over stock trading.
