Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

Recommended Posts

"You must be rigid in your rules and flexible in your expectations. Most traders are flexible in their rules and rigid in their expectations". This is from Mark Douglas in his book, "Trading in the Zone". When I first read the above-mentioned book years ago, I did not highlight or remember this quote as anything special. It was not until recently when I saw it again that I had the experience to recognize the pure wisdom in the words. That is the reason I am devoting this commentary to this quote, so everyone reading can recognize its importance.

 

The reason I feel this advice is so important is because two of the most common problems among new or struggling traders are addressed here. The first problem raised is that most traders are flexible in their rules. Actually, the truth is most traders do not even have a firm set of rules they trade by. Sure, if you ask most traders they will say that they follow stops, and set targets. But very few have the rules that are generated by a quality trading plan. Those that do, usually view them as optional, which really defeats the purpose of having rules.

 

The second problem is that traders are rigid in their expectations. They form or acquire a market bias, or a 'feeling' about a particular stock, and hold to that expectation regardless of what the chart (reality) is telling them. When good news is released, they go long the stock and stay steadfast in their bullish view; even though the chart (reality) is telling them the stock is falling.

 

Some say that you can't follow rigid rules, because trading requires your expectations to be flexible and change as needed, as the second part of the quote implies. Obviously, I agree that trading requires you to be flexible. I just believe that all of the contemplated flexibility can be part of your plan and your rules. For example, you can decide ahead of time and define what a 'change in market direction' is and then define how you react to that new information. You could react by selling all of your position, selling half, raising the stop, etc.

 

I hope that those of you that have not embraced these concepts take new look at the quote above and use it to help improve your trading.

 

Jared Wesley

Contributing Editor

Interactive Trading Room Moderator

Gap and Intra-Day Trading Specialist

Instructor and Traders Coach

pristine-logo-small.jpg

Share this post


Link to post
Share on other sites

Traders -- beginning and otherwise -- are flexible in their rules because they have no trading plans hence, no rules, or at least no rules that mean much. But it goes deeper than that: they have no plans because they believe that they are better traders than they really are, and since their record-keeping is spotty at best, they are perfectly capable of going on for years without much improvement (or none). In fact, their belief in their trading ability is so unshakeable that they don't hesitate to depart from their "plans" -- if any -- when they believe the occasion demands because they believe that they are smarter than their own plans (though one could argue that under these circumstances the plan can hardly be classified as such).

 

But it all works out in the end. This type of trader brings money to the market that traders with thoroughly tested and sound plans -- and rules -- can take from them, much like the kid in elementary school who gets beaten up on the playground for his lunch money.

 

Db

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • Date : 24th November 2020.Macro Events & News – November 24 2020Market News Today USD recovered after better than expected PMI’s. – Earlier AstraZeneca vaccine hopes lifted stocks, EZ PMIs worse than expected, UK’s better than expected but both poor. Trump acknowledged that Biden transition should start – Equities rallied further (Nikkei back and up 2.5%) & riskier currencies gained a bid. Biden to name Yellen as Treasury Secretary & Kerry as Climate Tsar. In total a triple whammy for sentiment and risk appetite. USOil followed stocks higher and Gold trades $50 lower than Friday’s close. German GDP revised higher to 8.5% in final reading, from 8.2%.Shortened Thanksgiving Week Ahead – Highlights – FOMC mins – more significance, after Mnuchin removed emergency funding – possibility of action at their Dec. meeting. Plus – Consumer Confidence, Durable Goods & GDPUSDIndex – Sank to support at 92.00 yesterday – rallied to 92.70, post PMI’s. back under PP now at 92.35. S1 92.10, R1 92.90.EUR – Rejected 1.1900 & tested down to 1.1800, again yesterday. Now 1.1855 (PP) JPY – down to 103.67 lows yesterday. Rallied to 104.60, now back to 104.40. PP 104.25.GBP – rallied to a smidge shy of 1.3400, & down to 1.3262. Back to 1.3340 (PP)now all in anticipation of EU-UK Trade announcement this week?AUD – 0.7340 – 0.7270 range yesterday. Trades at 0.7320 now (R1), PP 0.7295 NZD – down to test 0.6900 yesterday, another good Asian session for king Kiwi, back to test R2 0.6990 earlier, now at 0.6975.CAD – Back to 1.3040 (S1) ; R1 & 200Ma cap at 1.3090, S2 1.3015 CHF – 0.9075 lows to 0.9150 yesterday. Back to PP and 200Ma now 0.9115, s1 0.9093BTC – Holds bid at $18,400 (PP). Tested to 18k low yesterday.GOLD – Collapsed 3% from 1876 to test S1 at 1820 earlier – now 1830 – PP 1850 USOil – Rallied over R1 to $43.70. Vaccine hopes & OPEC+ production cut noises continue to support prices. R2 today 43.90. Private inventories later, official EIA data tomorrow.USA500 – Closed +20 (+0.56%) 3577 – USA500 FUTS now at 3605.Today – German IFO, US Consumer Confidence, BoE’s Haskel, Fed’s Bullard, Williams, ECB’s Schnabel, Lagarde, Lane,Biggest (FX) Mover @ (07:30 GMT) NZDJPY (+0.79%) –. Holds rally from yesterdays sub 72.00 open, ran to test R3 at 73.05 earlier. Fast MA’s aligned higher but cooling at R2, RSI 68 moving below OB zone, MACD histogram & signal line aligned higher, breached 0-line last week. Stochs. lowering from OB H1 ATR 0.2565 Daily ATR 0.7411.Always trade with strict risk management. Your capital is the single most important aspect of your trading business.Please note that times displayed based on local time zone and are from time of writing this report.Click HERE to access the full HotForex Economic calendar.Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!Click HERE to READ more Market news. Stuart Cowell Head Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • HotForex is an Official Partner of French giant Paris Saint-Germain F.C.! Dear Client, We are thrilled to announce that for our latest partnership we have become an Official Partner of Paris Saint-Germain F.C. for the 2020-21 season! The partnership will combine trading excellence and football finesse in a collaboration between a leading football team and market leading broker that share the passion required to be at the top. According to our statement: “We're incredibly proud to announce that HotForex is an Official Partner of Paris Saint-Germain F.C. Through this partnership, we are thrilled to offer our valued clients VIP tickets, exclusive gifts and events.” HotForex CEO George Koumantaris said: “This partnership is an exciting opportunity to bring together two brands who share global recognition for their commitment to excellence. Together we look forward to establishing new standards and offering clientele and supporters a truly unique experience.” HotForex is an internationally acclaimed multi-asset broker of choice to over 2.5 million live accounts worldwide that has earned over 45 coveted industry awards in its ten year history. Paris Saint-Germain F.C.’s popularity and success are also recognized worldwide, and it has a star-studded roster including Neymar Jr., Kylian Mbappé and Ángel Di Maria. Find out more about the partnership: Kind Regards, The HotForex Team
    • USD/JPY IS REACHING BEARISH EXHAUSTION, MAY REVERSE AT LEVEL 103.23 Key Resistance Levels: 111.000, 112.000, 113.000 Key Support Levels: 104.000, 103.000, 102.000 USD/JPY Price Long-term Trend: Bearish The USD/JPY pair has been in a downward move since November 12 after a rebound above level 103.30. The pair is approaching the previous support at level 103.30. The selling pressure will resume if the current is broken. The Yen will resume an upward move if the support holds. USD/JPY – Daily Chart Daily Chart Indicators Reading: The 21-day SMA and the 50-day SMA are sloping downward indicating the downtrend. The pair has fallen to level 40 of the Relative Strength Index period 14. The pair is in the downtrend zone and capable of falling. USD/JPY Medium-term Trend: Bearish On the 4-hour chart, the pair has been in a downward move after rejection at 105.00. On November 18 downtrend; a retraced candle body tested the 78.6% Fibonacci retracement level. This indicates that the market will fall to level 1.272 Fibonacci extensions. That is the Yen will reach the low of level 103.23 and reverse. USD/JPY – 4 Hour Chart 4-hour Chart Indicators Reading The USD/JPY pair is currently above the 25% range of the daily stochastic. It indicates that the pair is in a bullish momentum. The SMAs are sloping downward indicating the downtrend. General Outlook for USD/JPY USD/JPY has been on a downward move but the selling pressure is reaching bearish exhaustion. According to the Fibonacci tool analysis, the Yen will fall and reverse at level 103.23. Source: https://learn2.trade 
    • EURJPY BEARISH MOMENTUM REMAINS TOWARD 123.00 LEVEL EURJPY Price Analysis – November 20 The EURJPY pair is attempting to close beneath the 123.37 price zone as speculative interest stays trapped between coronavirus outbreaks and vaccine hopes. The pairs selling momentum remains toward the 123.00 level. Key Levels Resistance Levels: 127.07, 125.00, 123.37 Support Levels: 122.37, 121.61, 119.31 EURJPY Long term Trend: Ranging As seen in the daily time frame, the downside pressure is expected to accelerate if EURJPY breaks below the 123.00 support, exposing the ascending trendline support and the 122.37 low. Meanwhile, the moving average 5 and 13 stays mixed for a range in the coming sessions. If the 123.00 support holds, a surge towards the 123.40 level could be expected during the following trading session. However, a barrier around the MA 13 could serve as a limitation for bullish traders within this session. Lower here a firm breach of 119.31 level will argue that the rise from 114.42 level has completed and turned the focus back lower. EURJPY Short term Trend: Ranging The intraday bias in EURJPY is staying in consolidation with the current recovery. A much more decline is mildly in consideration with 123.37 minor resistance level intact. Beneath the 122.37 level will target a test on the 121.61 low level initially. The resolute breach there may restart the trend from 127.07 level with another decline to 119.31 key support level. On the upside, though, a breach of 123.37 minor resistance level may shift sentiment back to the upside for the 125.00 level instead. Source: https://learn2.trade 
    • Let’s skim some features of Dominion from the manual 1. Dominion is a black box with votes ultimately tabulated in a central server system. Who has access to the central server and where is the manual and security reviews of that server software? 2. Local IT can clandestinely change settings to potentially alter an entire election. There are no checks and balances or observers of the local IT guy when he accesses machine debug and admin settings. Its unclear if a log exists. 3. Many complex rules decide how the “straight ticket” option works, but he system can be set up to ignore votes for individuals if a straight ticket vote is selected. 4. Network Security is very weak since all software access keys use the same cryptographic pair. This gives plausible deniability to whoever potentially decides to mess around with voting settings. It cant be proven who changed a setting since everybody has the same key 5. Digital certificates are not protected by password, and Dominion user manual explicitly says not to enter a password. This enables potential for bad actors to MITM attack data traveling over network between precinct tabulator and central tabulator. 6. Cryptic “split rotation” function that features the ability to “force a maximum deviation”. There is no definition of a “split rotation”, so we cannot know what “force a maximum deviation” means in this instance. 7. Settings can be changed during evening downtime on first night of voting. Much easier to change settings on hundreds of machines than to forge thousands of ballots. A couple of people can do it quickly. 8. The word “Cast” became “Print”, obfuscating the moment when your vote becomes officially cast. Reason for the semantic changes requested by the State of Pennsylvania to the Dominion voting software is currently unknown. 9. There is an option to force the vote scanner to “overrun” a preset amount of ballots every time anybody pauses the scan mid-batch. “Overrun” is undefined. Potential for abuse is high with this function, which was added shortly after 2018 mid-term elections.   ... Americans have a bad and chronic case of “it can’t happen here” ... I'm just sayin'  
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.