Monday’s Blog Levels: The short idea never triggered and the market opened below the long idea.

Quick Tip: Powerful Habit

Do you know anyone who read the Bible, Quran, Torah, or Vedas only once? (Sorry if I missed your faith but you’ll get the point in a moment).

You read anything enlightening once… “Interesting! I didn’t know that. I’m definitely following this advice!”

Result: A few days of spotty application. Your experience is now called “history.” You didn’t change.

You read anything enlightening a few times… “I’m getting this. I see how it’s changing me for the better. I feel calmer, more intelligent, motivated. Wow!”

Result: You have some new habits. You’re seriously applying. Your experience is now called “real.” You’re changing.

You re-read anything enlightening regularly… “I knew that and forgot it! Studying this needs to be on my calendar....

Subject: Whipping fear.

You know that a confident trader is a winning trader, and a fearful trader is a losing trader. Part of your personal development plan should be eliminating your fears. Yes, fears. Plural. You can have more than one. Over the years teaching traders I’ve noticed different types of fear.

1. The most obvious is fear of loss. Managing your risk, pre-determining your “risk number” (the amount that negatively affects you either financially or psychologically) is the simple answer. Everyone can do this.
2. Fear of being wrong. This is a huge problem with traders and not so obvious. Look back to grade school. The teacher asked the class a question and only a few hands were raised. Not yours. Did you not know the answer? Or were you scared to be wrong in front of your friends? Fear of being wrong paralyzes some traders even when their risk number doesn’t.
3. Fear of not being in control. We all know people who are most comfortable when in control. They...

Yesterday: The suggested long at 4470.50 only bounced 4.75 points before continuing down.  

Quick Tip: Breakeven is a win.

Big win, little win, breakeven, little loser, big loser. All the outcomes of your trades. You don’t allow for big losers so that leaves all acceptable outcomes.

You can turn some of those little losers into breakeven trades. If you move your stop to breakeven after a pre-determined move in your direction (we use 4 S&P points) the outcomes are big win, little win, breakeven. Your drawdowns will be smaller. Your equity curve will be smoother.

What’s the downside? Subsequent price action doesn’t touch your original stop and the trade went on to your profit targets. You missed a winner.

You need confidence in your strategy and rules to succeed. Choose the style that appeals to your personality. Then keep records of every trade setup, taken or not, to find out which is better financially.

Today’s Best S&P Futures Turning Points:

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Tuesday’s Results: The suggested short @ 4580.50 nailed the top of the day session and ran for 63.75 points to the close. How much did you get?

Quick Tip: Orphans.

Entry decisions are easy. Exits are tough. If you managed this trade you likely took profit before the end of the day.  There were two 15+ point corrections in the trend down. Watching that money leave your account is tough. Not getting the full move of 63.75 points is tough, too.

All-star trader Larry Williams, in his book Long-Term Secrets to Short-Term Trading, finds that his best trades are those exited at the close. He researched and tested all kinds of exit strategies to determine this. His advice: enter and walk away. Come back at the close.

Another great trader I know, Bob Dunn, would say something similar. His view is NOT to cap your wins but let them run. In fact, this is a common view from many great traders. Cap your losses and let your winners run.

The challenge is this: you’re reviewing...

Subject: The foundation of success. 

Success at trading, at anything, is formulaic. No one stays successful at anything without a proven formula to follow. What’s yours? 

You may think it’s your trade plan. You may think you need the hottest strategies, the best broker, more risk capital, and better sources of information. All that surely helps but the foundation for your success starts within you. It’s your belief. 

Do you honestly believe you can become a top-notch trader? Or are you thinking of giving it a try? Trying isn’t enough to overcome the challenges of anything worthwhile. It’s a negative belief. Knowing you’ll succeed is a positive belief. 

The glass-half empty trader will think, “I don’t KNOW I’ll be successful, but I’ll try my best.” The glass-half full trader visualizes their success every day. Regardless of their daily result. You will have losing...

Friday’s Blog Results: No short fill. The long level @ 4510 stopped out for a 3.50-point loss (per contract).  

Quick tip: Lose your edge?

Your trade strategies must have “edge,” otherwise you’re gambling and likely losing. The challenge is that edge is not always permanent. You need to be vigilant in your review process and notice when the edge may be fading or gone.

Our team has been relying on some edge that was validated by thousands of trade setups. This past weekend I updated the edge document to reflect current market conditions and some of those rules needed adjustments.

Strategies and trade plans can evolve. If you’re losing confidence in your strategy don’t assume it lost its edge. Research your results database. You might find, as we did, some minor changes to reflect a changing market will bring the edge right back. Learn more about trade plans and edge. Click here.

Today’s Best S&P Futures Turning Points:

Short...

Thursday’s Blog Results: Neither trade triggered but the buy @ 4534.75 did touch and bounce for 6-points at 3:59 PM ET, too late to enter.  

Quick Tip: Glad you disagree!

In Stephen Covey’s bestseller, “The 7 Habits of Highly Effective People”, the 6^th habit is Synergize. The concept of synergy is real and born in nature. You’ll need to read the chapter (the whole book would be better) to get all the details and proof. Just assume it’s true for now.

Think about this: If everyone you talked to agreed with you about the subject at hand, would there ever be any improvement to the subject (process, strategy, plan, etc.)? Nope. Case rested. We agree. Move on.

That is precisely why you should embrace disagreement… from a constructive viewpoint. Different opinions and outlooks, when approached properly can lead to dramatic improvements. It’s obvious. No one knows it all. Only by being open-minded and willing to understand a counter...

Wednesday’s Blog Results: Neither trade triggered.

Quick Tip: Quick Fix-it is.

Wouldn’t it be fabulous to find the simplest, easiest, most profitable trading strategy that you could master in minutes?

Hell yeah! But not likely. Not even remotely possible. Innately you realize this is true. You know that wishing for this “winning Lotto ticket” is a fruitless solution to your need for sustainable trading skills.

Let’s turn the table. What if you were told this: “Successful trading requires intense study, practice, hard work, time commitment, and devotion.” Sounds overwhelming, doesn’t it?

But what if the result of that intense study, practice, hard work, time commitment, and devotion enabled you to fulfill your deepest lifestyle desires? What if you were so skilled that you didn’t even have to think about the job? It was like muscle memory. You just “did it.” All the rewards were obtained seemingly instantly.

What is...

Tuesday’s Blog Results: No trades triggered. BUT the short level missed fill by only 2 ticks. Reframe that as a positive for the strategy.

Quick Tip: Your unsatisfied need.

You’re either a trader or thinking about becoming one. Either way, to succeed in trading (actually, anything in life) you must be motivated. Why? Because there will always be setbacks, frustrations, losses, failures, and rejections. If you’re not motivated you won’t persist. You’ll quit and carry that psychological “loss” with you. Collect enough of those and you’ll be miserable.

The answer is to get and stay motivated. But how? Find your unsatisfied need. You don’t require motivation for anything that you’re already satisfied with. You don’t even think about it. If you have enough money for acceptable shelter, food, transportation, and recreation you’re not worried. You have those. You’re covered.

But if you don’t have enough...

Monday’s Blog Results: The buy ran for 52 points. The short offered 8.75. BOTH only had 2 ticks of adverse move. You can PayPal me a tip if you’re feeling guilty.

Quick Tip: The day matters.

Imagine if you could click the “print” button and a report would stream from your printer that showed how much money you made or lost by day of week. Would it surprise you if you lost money most of the time on a given day of the week? Say, Thursday? Would you call it coincidence and keep trading or would you stop?

If you’re not documenting all your trades, taken or not, with plenty of related information you’re missing out on huge “edge” potential. Day of week matters. Time of day matters. Volatility matters. The list goes on and on. Commit yourself to building your own results database rich with all the data points you can think matter.

From “start” to meaningful results takes plenty of time. Prefer a short cut? Click the button below...