Donald

Losing because your analysis was wrong. Losing because your impatience, greed or fear stepped in. Those are the losses you can get rid off, by training self-discipline.

I wasn't sure where to put this, so the powers that be can move it if they see fit. I put it here for anyone who is just starting out and wondering what it really takes to become part of that elite club of profitable traders.
 
I lurk on several trading forums. I join a few and make a few posts. One thing that I rarely see is the painful path one took to becoming successful. So for all you beginners here is what becoming successful took. For my fellow brethren that are already in the club have a good laugh.
 
The markets had always lured me as a kid. I would read the paper and make predictions. Sometimes they were right; sometimes not. Then one day I got that famous commodity-trading flyer, sent my money off and took the plunge.
 
My first stab at trading was commodities and I started with $5k in 1991. I was using the strategy as outlined by the guru. The account was gone within a few months. Well that didn’t work. I thought, people do this everyday and make money why not me.
 
So off to the library. I read every book the Memphis library had on trading and investing. I paper traded the strategies I found while I built my bankroll back up. I learned exits, set-ups, position, expectancy, market psychology, and portfolio management. I soon realized that I was reading the same thing over and over no matter which book I checked out.
 
Time to build my strategy. I am ready to do this. I bought a new computer, Metastock Pro 6.0, and opened an account with $30k. Its 1995, and this is my shot. By 1997 I was toast again. The family life went to hell in a hand basket, and I thought I could trade through the difficult times. The result was an account with a balance of $2500.
 
Back to the drawing board. Took care of the personal stuff. Lived like a monk raising capital. Worked nights and watched the market during the day. Took a second job on the weekends to raise more money.
 
Then one day out of the blue, the little red and green candles started to make sense. I saw patterns develop over and over in the same spots. I placed a trade and made a profit. But I had done this before. I removed the MACD from my charts. Placed another trade and made a profit. Maybe I am on to something. Removed the channel indicator that I stumbled across. I could still see the action and new what the MACD was doing and where the action was in the channel without them even being on the chart. I even stopped drawing trend lines.
 
It was just me and the screen. I planned every trade. I knew exactly when, where, and why I entered and exited. I was patient. I became a predator. Lurking and waiting. I took every shot the market gave me. If it started to go wrong, I got out quick and waited. If the market did not give me an opening, oh well. There is always tomorrow.
 
By the fall of 1999, I was consistently profitable and have been ever since. For those that are waiting for the sales pitch, there isn’t one. For those that are waiting for me to expose some great secret, well there isn’t one of those either.
 
What I will give you are a few simple pointers that I learned the hard way. And the sad part is, most will stilll learn these the hardway.
 
1)Take everything you read with a grain of salt. That includes this post.
 
2)Never pay for a system. It is just not that easy.
 
3)If something comes up in your life that is distracting, stop trading.
 
4)Plan every aspect of your trade down to the smallest detail, and plan for every possible outcome.
 
5)Develop your own strategy. Don’t let someone tell you that you can’t trade a simple moving average if you truly believe you can.
 
6)Test the strategy in the market that you will be trading. If you like the results, trade it in another totally unrelated market and see if it still holds up.
 
7)Paper trading is ok, but there is nothing that truly tests the strategy like hard earned cash.
 
8)You will have to make sacrifices in order to make it. I still do. In the middle of my learning period I was working 18 hours a day during the week and 12 on the weekend.
 
9)You are responsible for everything when it comes to trading. That includes stop running, bad fills, limit moves, your PC crashing. I mean everything. See #4
 
10)And last but probably most important, don’t be afraid of failure. Just do like Edison and go, “Well that didn’t work”.
 
Good trading to you all.

$TEVA (TEVA) stock nice opening breakout, from Stocks To Watch,



analysis http://chart.st/TEVA
 

I like that idea of pulling out the profits. I think where some traders go wrong is thinking in terms of a salary and expecting a fixed dollar amount every xx week/weeks like when they are on payroll.
 
In all my years of trading my returns are never smooth -- some weeks/months the market is just so generous, other times it's incredibly stingy. I'd drive myself crazy if I had a "salary" expectation that was consistent/smooth.
 
Even when I look at my long-term non-traded assets like funds and stocks if I look at the monthly returns it is literally all over the map.
 
So, skimming out the profits makes sense but just don't expect that to ever be a consistent number. Assuming it's positive to begin with!
 
MMS

I agree with cuttshot. Once you have a sizable account I find it necessary to remove all profits for the week from your trading account. Take physical delivery of that money and go cash it at the bank, touch it, hold it in your hand, and then deposit it into your check, savings, and investment accounts.
 
I think this process is important because it makes what we are doing tangible and real. Perhaps its mostly for psychological purposes, but if you leave the profits in your account, they are "at risk" of the market. Removing them each week keeps it structured more as a business.

davey,
 
It is very important that you focus on building your account before even considering taking any money out. Trading full time on a $10,000 account just wont cut it. You can start with a small account but you need to leave the profits alone. Pulling money out right away will just lead to you spinning your wheels.
 
How much money you pull out and when you do it depends on your lifestyle. Keep in mind there are fees when you pull the money out so you don't really want to be doing this too often. I have found it best to start with a budget for yourself. This way once you have built your account size up to make a living off you can pull the minimum amount out monthly/quarterly to cover expenses.
 
The budget will also help you guage when it's possible to trade full time for a living. You should make sure you can make money for an extended period of time before you consider going at this for a living. Making money for 2 months in a row will not guarantee future success. You could run into weeks or even months where you don't make any money. Hopefully you are using a system that doesn't let this happen very often but it is possible. You have to make sure you are able to ride these times out.
 
traderwill gave you some great advice. Having a successful system in place is very important. I would also recommend getting that budget in place so you know what you need to make in oder to cover expenses. From there you will be able to schedule your withdrawals.

Daveyjones, this is a great topic. If you've been trading for a while you know that there's a lot of hype about the fortunes you can make by trading for a living. The reality is that like every job or business it is a process of gradual growth. And if you know people who've started their own business, you'll know that they lived like paupers for years, building their business to the point where they could reap the rewards by paying themselves a decent salary.
 
It's the same with trading for living. If you have a profitable system, you first need to build your trading account so that you can increase the number of shares, contracts or lots that you trade. You also need to have an idea of how much you need or want to withdraw from your account on a monthly or quarterly basis, that becomes essentially the salary you want to receive. Once you trade enough shares, contracts or lots so that your account grows on average more per month or quarter than what you want to pay yourself as a salary, then you can start pulling money out of it. But not before. You want to be in the position that even after your periodic withdrawals the trading account continues to grow, albeit more slowly.
 
Depending on the initial size of your trading account, and on the profitability of your system, you may have to build your account for one or two years before you can start pulling money out of it. It can be done, but not as fast as some would have you believe. Of course the larger your starting account and the smaller your salary requirements, the faster the process.

You can't reinvest everything you make. Eventually, you will need to take money out of your trading accounts and pay bills, take your family on vacation, etc. But how often and how much should you transfer from your trading accounts to your personal accounts? Should you take out a fixed amount each month or a percentage of your earnings? What if your accounts are currently sitting lower than your opening balance? Should you wait until you move above that point before you reward yourself with a salary?

In an effort to educate and stimulate some discussion, I'm going to try to put together a few steps for candlestick trading success!
 
Step 1: Identify the candlestick 'patterns' or 'formations'
 
There are a variety of websites and books out there talking about candlestick patterns or formations.
 
Some sites out there with some free stuff that can at least get you started in pattern recognition. Stockcharts.com in particular has a nice section on candlesticks (click hyperlinks):
 
Main Page
Intro To Candlesticks
List of Common Patterns
 
That's a few free links from stockcharts.com. Those are pretty good for being free. Keep in mind that is not meant to be a substitute for books, videos and live seminars. As mentioned previously, I like the work of Steve Nison.
 
So the very, very first step is to be able to look at a candle(s) and identify if there's a potential candle pattern or formation there. That's step 1. I know that seems easy, but it can take some practice, esp in real-time and esp in day-trading. I would suggest looking at some DAILY charts and just start flipping through charts of stocks to see what you can recognize. Don't worry about stock charts if you just trade futures, you just want to train your eyes to see patterns and formations.
 
And speaking of day-trading, there is one important consideration when using candlestick analysis in a day-trading environment - YOU MUST REMAIN FLEXIBLE IN YOUR DEFINITIONS OF CANDLESTICKS IN REAL-TIME, DAY-TRADING. The lower the chart timeframe, the more flexible you must be. And what I mean is that if you are only looking for picture perfect hammers, you might be waiting a while for a signal. As we get more charts posted, this will make more sense.
 
And from candlestick recognition, there are a couple schools of thought of how trade them:
 
1) Trade any of the patterns if your parameters are met.
2) Trade certain patterns based on your preference and testing.
 
This is going to be an integral part of your trading plan and there's no right answer here. It really is dependent on how you build your trading plan and what your testing has shown. I'm not going to do the work for you, so don't bother asking.

Pastthepost, if you are a newbie, I think online courses are suitable for you. Through this, you can easily learn and understand what you need to know about trading and more.

Every stock market investor wants to make a good profit from stock market but the journey to stock market most often starts with No Rules.

It depends on the person that how he can manage his skills with trading and learning the basic with a demo or any other way. We can suggest them but after all, learning is the procedure which takes time.

Mits,
 
Insist? I let it go long ago... and just thank the lord I don’t need this place. https://www.theguardian.com/media/2018/jan/23/never-get-high-on-your-own-supply-why-social-media-bosses-dont-use-social-media'>https://www.theguardian.com/media/2018/jan/23/never-get-high-on-your-own-supply-why-social-media-bosses-dont-use-social-media
My audience here is miniscule and I only need to do a better job with them...
 
As far as damage goes...and “What chance is there for a return to the 'glory days'” etc - imo, the intolerance of the smart posters edges out damaging TL more than the bot echo chamber dumb posters do across the years. And neither are ultimately to blame. We’re looking at multiple generations now of dumbed down... and the results are starting to show.
https://www.theguardian.com/media/2018/jan/23/never-get-high-on-your-own-supply-why-social-media-bosses-dont-use-social-media
 
Re:AI
" never spoken" / “swear at the fukcre” - That’s funny, mits . To get passed off to a human quickly, I like to mumble
 
Luvn AI .... dystopi

 
Why You Say Indicators Fail and Price Action Always Works ? ...esp when AI uses indicators to 'create' PA
 
shine on you crazy diamond
 
zdo
 
 
ps CrzyCzry is the ultimate generalist... :rofl:

Actions for the 31st.

Iphones and phones running Android have serious security issues. I'd be careful before using anything that requires a password and relates to money (banking, trading, etc.)

I'd strongly suggest to anyone who is serious about trading to think very carefully about whether using a mobile phone app for trading is a good idea. The interface, speed, reliabilty and security issues make it something I personally wouldn't do. If you have a position and you absolutely must leave, either make sure you have a way of getting through to your broker's execution desk quickly or close the position out before you leave.

I've been using my iPhone 7 since the release of this phone. So I was trading for about a year now, and I never had a problem using my broker's mobile platform.

For me, just for monitoring purposes. That's it.

I have a suggestion. When someone first registers at Traders Laboratory, automatically send them some tips, or links for beginners. They may not be a beginner, but it won't hurt.

:haha: I hear you say. But really. I think that this is perhaps the single biggest factor in the high failure rate of new traders. Perhaps it would be better put that you should not expect to make money.
 
Let me put it in a different way. A beginner will come into trading and have had very little experience of anything similar. The market will however look familiar somehow and tease them into thinking small successes are down to skill. After all, humans like certainty and are quite happy to congratulate themselves when they think they are good at something.
 
Would you expect to pick up a guitar and then a month or two later be playing at a rock concert? Would you expect to pick up a paintbrush and shortly after have an exhibition on display at the Louvre? Probably not. The difference is though that poor trading costs you your money. Coming into trading, you will be pitted against seasoned professionals, massive hedge funds, banks and computer systems to name but a few.
 
Losses early on affect more than just your bank balance. They affect your emotions and your ability to learn and develop confidence in your understanding of markets and methods you use to trade. If you don't understand how to 'take a loss' this can be catastrophic.
 
Do yourself a favour, when you start trading, trade to trade well, not to make money!

One of the number one reasons that traders lose money is because they cannot follow the most important rules. In fact, some novice traders do not even have any rules in place when trading. They are simply relying on luck or tips to make money in stocks. Here are three rules that every stock trader should adopt if they want to have a chance in this market.
 
1. The 10 Percent Rule. The ten percent rule was made famous by the legendary trader Jesse Livermore. He said that he would never take more than a 10 percent loss on any stock. Whenever he broke this rule and let his emotions get the best of him he really suffered a bigger than expected loss both financially and mentally. A ten percent loss keeps you in the game and allows you to fight another day. I cannot begin to tell you how many times I have seen one trade turn into a huge loss. This giant loss often hurts the trader involved and has even been the cause of many blown up accounts.
 
2. Do Not Trade With Capital You Cannot Afford To Lose. There is an old saying, scared money never makes any money. Whenever traders and investors trade with capital they cannot afford to lose it hinders their thinking. Trading comes with enough pressure already, but betting the rent or the mortgage on a stock simply affects the traders ability to read or follow that stock's price movement correctly. A good rule is to also apply the 10 percent rule to position size. Never put more than 10 percent of your account into any one stock position. This will allow you to find other trading opportunities should they arrive. All of your capital will not be tied up in one stock. By keeping the position size to just 10 percent of your account you will not have too much of an emotional connection to any one trade. Keeping the stress of trading down is extremely important for your health.
 
3. Learn To Use And Read Charts. While most of the people in the world will use fundamental analysis to trade (PE ratios, EPS, book value, ect) it is the charts and technical analysis that will show you the actual money flow of a stock. The bottom line, the trend is your friend except at the end. Reading charts of stocks will show you patterns and signal where the money is going and flowing. Remember, it is money flow that moves stock prices not opinion from some talking head on the financial news channel. How many times have you seen a company report great earnings only to see the stock plummet and vice versa? Often, the chart will tell us this will happen before it does. Chart reading will also help traders to place stop losses and know where pattern breaks down or fails. Traders must understand that it is just as important to know where you are wrong on a trade as it is to know when you are correct. Charts do all of these things and more when a trader can read them. Every trader and investor should get educated in reading and understanding charts.
 
 
Nicholas Santiago
 
InTheMoneyStocks

Im a beginner trader and just wanted to say hi. Ive bin trading with a real account for about 6 months now strictly in stocks. Practiced on a simulated account for about a year off and on and i must say the difference is like black and white, I did far better on my simulated account. Hoping for better times ahead.
 

You are right Greed is bad in Forex....

First, there's no short-cut. Either commit to spending hundreds of hours developing professional skills or don't begin at all. If it was easy, we'd all be millionaires.