Free Forex Guide Part 9
23. Measure yourself by profitable consecutive days and not by individual trades.
24. The best way to break a streak of consecutive loses is to not trade for a day.
25. Don't stop trading when you’re on a winning streak.
26. Don't turn three losing trades in a row into six in a row. When you’re off, turn off the screen, do something else. Sticking in when you
are loosing is just silly.
27. Scalpers reduce the number of variables effecting market risk by being in a position only for a few seconds. Day traders reduce market
risk by being in trades for minutes.
28. If you convert a scalp or day trade into a position trade, technically you did not consider the risks of the trade properly.
29. You should not worry about a missed opportunity. There is always another one just around the corner.
30. If you look for secrets in the market you will only find things that no one cares about. It is better to use the tools, which will be
covered in the next section.
31. Never ask for someone else's opinion, they probably did not do as much homework as you did anyways.
32. When the market is going up, you should say it aloud. When the market is going down, you want to say that aloud too. The reason for this is
that you’d be amazed at how hard it is to say what is literally going on in front of you when your mind is full of preconceived opinions.
33. Successful day trading requires flexibility. You have to do your homework so that you can understand the full potential for both sides of
the market. This will allow you to make your trades based on what the market is doing at the time of the trade.
34. Here is a quote that would be good for you to remember: “When you wake up, your instincts are wrong.”
35. When you make a mistake of discipline, whine like a fool to anyone that will listen. Any errors that are made in discipline are mistakes
you will keep on making for many years. Wearing ashes and sack cloth may help you to extend the time before you do it again.
36. If you whined or got fidgety while you read this list, then you share two obvious characteristics with many other traders:
A. You have traded long enough to recognize that you (not the market) make mistakes, and you try to overcome them.
B. This fact is awkward, you have become part of the market and you can never leave. No matter where life takes you, you will always check
the market and you will also always want to continue being a part of it.
1. For small accounts ($25,000 and under), like I said before you need to trade with the trend. Many beginners look for trades
that flow in any direction. While forex trading easily permits bi-directional trading, trading in the direction of the trend improves
your odds over the long run.
2. You should have at least two accounts. One real account and the other a demo account. Learning doesn't stop when trading real
dollars begins. Keep the demo account and use it to test any alternative trades etc. For example, you can shadow your real trades with
identical ones in your demo account, but you will want to widen your stops in the demo in an effort to see if you're being too
conservative.
3. You have to stop looking for leading indicators because there aren't any. While some firms make a lot of money selling software
that predicts the future, the reality is that if those products really worked, they wouldn't be telling you about it.
4. Examine the daily charts, the four-hour charts and one-hour charts are there to assist you in timing your trades. While you are
trading at 30- and 15-minute time increments, it takes a great deal of dexterity.
5. Don't trade the time frame that is offered. Trade the pattern instead. Reversal patterns, hesitation patterns and breakout
patterns show up a lot. Learn to look for the pattern in any time frame.
6. If you have the right amount of money, trading two lots is safer than just
trading one. Trading three lots is safer than two etc. Trading is a big pile of
emotions, technical analysis and money management. One lot alone makes it difficult to weigh these elements in deciding to enter or
exit.
7. Extreme trading can be the most conservative trading when you think about it. Trading at the extremes increases the odds that
you have chosen the right direction.
8. You should fully check the Big Five the dollar/yen, euro/dollar, Swiss franc/dollar, euro/yen and pound/dollar
before you decide to take a position in any one of them. There might be something obvious that you’ve missed.
9. Follow the Upside Down Rule. If you can turn a chart upside down and it still looks the same, avoid it all together.
10. Don't keep count of your profits in your first 20 trades. Keep track of the percentage of wins instead. Once you know you can
pick direction, profits can be increased with multi-plot trading and by using variations in your stops. In other words, now is the time
to get serious about your personal money management.
(Continued on next page)
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