CONTROLLING RISK

One of the most important things You can do as a trader is to control your risk. In other words pre-set a point that You have determined that You could possibly be wrong.



Remember, trading isn't hard, it is just tricky because everyday the market does the same thing, it moves up and down and sideways and gets choppy. It not only does this every day, but every week, every month and every year. Your job is to determine the primary direction of the market's movement and try to profit from that knowledge.



Sounds easy, but there are hidden traps in the market to snag You, and keep things interesting. Market Makers are always trying to to trick You before taking price strongly against You. They are attempting to trap You in a losing position. This happens everyday in the market, and it WILL eventually happen to You too.



You advantage is in keeping your losses small. Have a predetermined amount of pips the You are willing to lose. Once You have determined that amount, 'say 20 pips or so on a short term trade, MAKE NO EXCEPTIONS!!!!!!!



A FREE RUNNING LOSS can be a major game changer!



It should not take a -200 pips in short term trading before You realize that You have loss Your advantage. If You are telling yourself "Ah it will come back", chances are very good that You are already in trouble!



Being a pro traders does mean that you never take losses, being a Pro Trader means that You never let losses take You out of the game!!!



NEVER LET THEM TRAP YOU!!!!!!!







If You are telling yourself "Ah it will come back", chances are very good that You are already in trouble!



CUT BAD TRADES QUICKLY AND GO IN THE DIRECTION OF PROFIT!!!!!

YOU CAN DO THIS (^_^)!

SEASONS

This was an amazing gift from a Friend this morning and I had to share it:

There was a man who had four sons. He wanted his sons to learn not to judge things too quickly. So he sent them each on a quest, in turn, to go and look at a pear tree that was a great distance away.

The first son went in the winter, the second in the spring, the third in summer, and the youngest son in the fall.

When they had all gone and come back, he called them together to describe what they had seen.

The first son said that the tree was ugly, bent, and twisted. The second son said no it was covered with green buds and full of promise.

The third son disagreed; he said it was laden with blossoms that smelled so sweet and looked so beautiful, it was the most graceful thing he had ever seen.

The last son disagreed with all of them; he said it was ripe and drooping with fruit, full of life and fulfillment.

The man then explained to his sons that they were all right, because they had each seen but only one season in the tree's life.

He told them that you cannot judge a tree, or a person, by only one season, and that the essence of who they are and the pleasure, joy, and love that come from that life can only be measured at the end, when all the seasons are up.

If you give up when it's winter, you will miss the promise of your spring, the beauty of your summer, fulfillment of your fall.

Moral :

Don't let the pain of one season destroy the joy of all the rest. Don't judge life by one difficult season. Persevere through the difficult patches and better times are sure to come some time or later.



Thanks Jonathan, it was a much needed lesson for life (^_^)

YOU CAN DO THIS (^_^)

A LOSS IS LIKE A RATTLE SNAKE

A loss is like a rattle snake, DROP IT BEFORE IT KILLS YOU!!!!!!!

As of late, I have been getting emails from traders who have blown up their accounts. Believe me, I know first hand the pain, desperation and frustration that comes with that experience as I have had it many times. The first time I blew up an account I had to get two jobs 7 days a week to almost cover my bills and I was still struggling.

No matter how many accounts I have blown up, I have always managed to do it the same way every time 'holding on to a loss' that grew up to kill me because I refused to let it go, hoping and praying that the market would come back in my favor.

When I would read other traders info that said cut losses, I thought they were being negative and trying to make me lose my money. Had I listened to that wisdom, it would have saved me many heart-aches.

Let's deal with some hard facts about trading:

#1 YOU ARE GOING TO LOSE MONEY HERE!

This is a big girl's game, if You are afraid to lose money, You should be doing something else with your life, it will be much more profitable.

#2 THE MARKET IS VERY VERY GENEROUS AND WILL ALWAYS GIVE YOU OPPORTUNITIES TO MAKE MONEY!!!!!!

-CUT BAD TRADES QUICKLY AND GO IN THE DIRECTION OF PROFIT!!!!!!

Most of us got into forex with the idea that this is easy money, ignoring everything that told us that 95% of all 1st time traders go broke in the market. We ignored it because we decided that we would be part of the 5% who beat the odds. If You are like I was, You read every book You could get your hand on, every website and attended every webinar to make sure You were part of the 5% who were successful here.

FOREX IS NOT HARD. FOREX IS TRICKY AND WITH THE RIGHT EDUCATION AND DISCIPLINE ANYONE CAN DO IT (^_^)

What we fail to realize is that forex is like any other profession, it take most of us a while to be successful here.

NO ONE WHO IS TRULY GREAT DID IT OVERNIGHT, it took continuous education, practice, discipline and sometimes a little blood, sweat, and tears.

I don't care how brilliant a surgeon is, You don't want him to cut on you without PROPER TRAINING & PRACTICE. Notice how many high powered professions are always practicing, 'Practicing Physician', Practicing Attorney'. Other professionals are practicing to get better and so should You.

You can be successful at forex, but not if You are not willing to do what it takes to succeed.

SUCCESS LIST FOR FOREX:

WAIT for a proper trade set-up before entering the market!

LET GO of bad trades quickly!

ALWAYS TAKE MORE than You give!

YOU CAN DO THIS (^_^)

SAVE YOURSELF!!!!!

Last week we got a huge surprise in the market when the bank of Japan intervened to devalue the yen against other major pairs. Most traders were caught on the wrong side of the trade. Many took huge losses and some of them let their account be blown up.

Guys when bank volume starts to move price, You may not get a pullback to take a smaller hit. If You don't have volume on your platform, You can recognize bank action by price that moves one way almost continually without much retracement. Price will get to a resting plateau and rest before exploding again in the direction of the previous price action.

Many of us will sit at our screens, cursing, praying, begging, but the best thing to do is to save yourself, by cutting bad trades quickly. DON'T DEPEND ON THE MERCY OF THE BANKS TO DO IT!!!!!! THEY ARE OUT TO EAT YOUR LUNCH ALWAYS ! THEY ARE YOUR ENEMY, AND THEY ARE RUTHLESS WITHOUT MERCY!!!!!

What happened last week was nothing more than a market shake out, it happens to traders about 3-4 times a year. The last big one in May 2010 saw a drop of up to 1000 pips in 24 hours.

What can You do to save yourself from this kind of adverse action.?????????????

#1. DON'T LEAVE OPEN POSITIONS! Trade what You can see. When You are not in the market take your money out with You. That way You can save on all of those foul words to Your broker when he tries to explain the price slippage that caused price to go beyond Your stop loss.

#2. If You must leave trades opened, put in a physical stop losses..

#GRANDDADDY OF THEM ALL!!!!!!!!!

NEVER LET LOSSES RUN !!!!!!

NEVER LET LOSSES RUN !!!!!!

NEVER LET LOSSES RUN !!!!!!

CUT THE LEGS FROM UNDER THAT BEAST AS SOON AS POSSIBLE!!!!!!!!!!

Two things are essential if You are going to enjoy a very successful and lucrative trading career.

#1 Wait for a proper trade set-up

#2 Learn to save yourself. CUT BAD TRADES QUICKLY!!!!!! So what if it comes back in your favor, many times it will, but it only takes one good shakeout to leave your lifestyle in jeopardy.

Cut bad trades to leave the most capital possible for a more profitable trade set-up. THE MARKET IS VERY VERY GENEROUS, IT WILL ALWAYS GIVE YOU ANOTHER OPPORTUNITY TO MAKE SOME PAPER, BUT YOU HAVE TO CUT YOUR LOSSES QUICKLY SO THAT YOU HAVE THE MAXIMUM CAPITAL TO TAKE ADVANTAGE OF THE RIGHT OPPORTUNITY WHEN IT PRESENTS ITSELF!!!

The market is swim, float or sink. Don't let them sink You. SAVE YOURSELF!

YOU CAN DO THIS (^_^)

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DANCING WITH THE MARKET

Dancing with the market can often be a frustrating experience because it is constantly attempting to trip You up on the dance floor.

To make Your dance experience a little more pleasant, You must develop the discipline of a Master Trader.

You must be willing to severe trades that are working against You.

You must be willing to wait for proper trade set-ups.

You must continue to educate yourself.

The market is fickle and temperamental, some might even call it bipolar. Sometimes it is up, sometimes it is down. As a trader You must tread lightly and follow the varies moods of the market until You can see an advantage.

As a trader You only have two jobs when You engage the market in dance.

#1 Keep from being tricked........

#2 Try to put a little money in your pocket...............


That is it!!!!!!! It is as simple as that (^_^)

YOU CAN DO THIS (^_^)

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EVERY BROKE TRADER DOES IT THE SAME WAY

Every trader who ever goes broke does it the same way.

I have heard it said that Traders go broke because they are under capitalized, that isn't true. If You can lose $100.00, you can lose $1,000,000.00. The problem is the same in both traders, the refusal to let go of losses. The difference between the pro and the amateur isn't necessarily his/her trading ability. Trading is easy!

The difference is in how he/she takes a loss. A disciplined pro will say, " I will stop the bleeding here if I am wrong." The amateur says, " I am right and eventually the market will come back in my favor." If You are thinking that, You have lost Your advantage.

While a pro will let 10 profitable trade kill 1 loss, an amateur will let one loss eat the profits of ten profitable trades. Both traders had the same number of trades but one will end the month in profit and the other will end the month in stress and pain.
Cutting a loss quickly soon ends your attachment to that trade and allows You to pursue a more profitable trade set-up. Part of the reason it is so hard to cut a trade is because You waited forever for that trade set-up and now You not only have to admit that You did not have the advantage that You thought that You did, but now You have to start the process all over again and with a loss.

DON'T MARRY ANY POSITION; THE MARKET CAN CHANGE IN AN INSTANT!!!!!!!!
IT IS ESSENTIAL THAT YOU HAVE AN EXIT STRATEGY (ONE THAT WILL CAUSE YOU THE LEAST AMOUNT OF PAIN)IF THINGS DON'T GO AS YOU PLAN!

ANY TRADE CAN TURN INTO A LOSS!

If You play this game long enough, You will eventually meet with disappointment. It happens, cut and move on. The market will give You another chance to make profit.

Never allow yourself to become wounded beyond repair in the market, either financially or emotionally. Cutting a loss means that You love Yourself enough to save yourself.

If You are going to win at this game, You have to have the capital to play and cutting trades that have lost the edge is one way to thrive here.

Gotta learn to save yourself! If You are getting stopped out frequently, You have gotta to rethink your strategy because something is wrong.

Free Your mind to find good trade set-ups by cutting trades that are not working in your favor. Holding on to diseased trades only punishes You and eventually it can break You

The biggest discipline that a great trader learns is how to cut a loss

YOU CAN DO THIS (^_^)

HOW I TELL I AM LOSING MY ADVANTAGE

When trading the 1 min time frame it is essential for You to be able to recognize when You have lost Your trading advantage.

These are ways that I can tell that I no longer have the advantage that I believed that I did:

If price moves above/below the previous candle even though it may not close there, I don't have the advantage.

A good trade should run in your favor almost immediately !

If you are not in a decent profit in 7-10 mins , then You may want to consider getting out with a tiny profit or at break even, because chances are high that price is going reverse on You.

Wacky MA's- Pay attention to the order of Your MA's, it is very important, they will tell You if You are in a good trade or trade hell. If your moving averages are 1, 2, 3, 4, 5, then they should be in order 5, 4, 3, 2, 1, or 1, 2, 3, 4, 5, not 4, 2, 3, 1, 5.

Lastly a flat 50 period strongly suggest that You may not have the advantage that You thought.

YOU CAN DO THIS (^_^)

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