How to improve trading skills? | Forex Factory

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How to improve trading skills?

  • #1
  • First Post: Oct 21, 2009 3:21am Oct 21, 2009 3:21am
I have been in trading for 1 full year, and is close to consistently profitable.

The daytrading method that I am using is the most traditional and standard methods, like drawing horizontal Support/Resistance and diagonal trendline, observing Price action around them, and observing overall Trend, classic Pattern, 50% retracement, etc.

I wonder if there is a more effective way to improve my skill than just keep practising.

If you have better experience than me, please summarise your path of improvement and share with me!

Many thanks!
  • #2
  • Oct 21, 2009 3:42am Oct 21, 2009 3:42am
u might want to practice next skillset ,
scaling,
scaling in while in profit , scaling out while it goes bad...
To Live is the rarest thing in the world , Most people exist , that is all
  • #3
  • Edited 7:34am Oct 21, 2009 3:55am | Edited 7:34am
Quoting maheswara
u might want to practice next skillset ,
scaling,
scaling in while in profit , scaling out while it goes bad...

Thanks maheswara,

I refrain from learning something brand new to me, before I am skilful enough in my current skillset. This is for a good reason.

Nice people keeps suggesting me something new to me, such as volume, fundamental, etc. this could be an endless list. Nevertheless, if I keep learning new things without being experienced in one set of things, I will turn out to be not experienced in anything.

cheers,

kk007

P.S. I think here I am looking for more "directional" advices rather than a specific and concrete method, but thanks for your response anyway!
  • #4
  • Oct 21, 2009 4:54am Oct 21, 2009 4:54am
Quoting kk007
I have been in trading for 1 full year, and is close to consistently profitable.

The daytrading method that I am using is the most traditional and standard methods, like drawing horizontal Support/Resistance and diagonal trendline, observing Price action around them, and observing overall Trend, classic Pattern, 50% retracement, etc.

I wonder if there is a more effective way to improve my skill than just keep practising.

If you have better experience than me, please summarise your path of improvement and share with me!

Many thanks!
I find really useful to perform weekly and daily analysis to identify possible scenarios and key levels. I then go to my preferred lower timeframes and I take trades according to the weekly and daily plan. In this way I have a confirmation of the bigger picture which helps me filter out more false signals given on lower timeframes and I also have a better idea if the prices have the potential to keep going or just consolidate.

For example if I see a break of a resistence on a daily chart, I wait for a retracement and go on the 4h/1h charts to see if I can spot a retest of that level as support. If I do, I then start looking for long entries according to my strategy.

In this way you do not need to add new skills but you will have a better understanding of the overall trading environment and you will plan your trades much better. Maybe you will take fewer trades, but they hit rate will be higher.

Hope this helps.
  • #5
  • Oct 21, 2009 5:33am Oct 21, 2009 5:33am
Quoting dacouk
I find really useful to perform weekly and daily analysis to identify possible scenarios and key levels. I then go to my preferred lower timeframes and I take trades according to the weekly and daily plan. In this way I have a confirmation of the bigger picture which helps me filter out more false signals given on lower timeframes and I also have a better idea if the prices have the potential to keep going or just consolidate.

For example if I see a break of a resistence on a daily chart, I wait for a retracement and go on the 4h/1h charts to...
Thanks dacouk,

It is similar to a method that I am using. I identify S/R on the higher timeframe and observe the lower timeframe when trading. Yes. I do trade this pullback scenarios. It sometimes works sometimes doesn't.

I know that very experienced traders can distinguish when the setup will work and when it won't.
  • #6
  • Oct 21, 2009 6:30am Oct 21, 2009 6:30am
Quoting kk007
Thanks dacouk,

It is similar to a method that I am using. I identify S/R on the higher timeframe and observe the lower timeframe when trading. Yes. I do trade this pullback scenarios. It sometimes works sometimes doesn't.

I know that very experienced traders can distinguish when the setup will work and when it won't.
Good that you look at multiple timeframe analysis but I didn't exactly say that, let me rephrase. The pullback scenario was just an example.
I'm not saying that if you see a trade setup on a daily chart you should trade it on a lower timeframe. As you said, trade set up might work or not.

I'm saying that the trade set up on the daily chart to go long for example, is just a confirmation to look for longs on your lower timeframe whatever your strategy is.

Let's reconsider the pullback scenario on a daily chart. On a daily you would have a target say 300/400 pips away. You do not have to take that signal at the very bottom when prices just bounced from support. You wait and check that the support actually holds.
Now the price is maybe 200/300 pips away from your daily target, support held, now you get an entry signal to go long on your 1h chart with target 100 pips away. This trade has a much higher probability of success.
  • #7
  • Oct 21, 2009 6:33am Oct 21, 2009 6:33am
I agree u may also look at longer term trading, based on technical but also fundamental analysis
  • #8
  • Oct 21, 2009 7:33am Oct 21, 2009 7:33am
Sound to me that I have to improve bit-by-bit and keep working on it. No better way than this?
  • #9
  • Oct 21, 2009 7:36am Oct 21, 2009 7:36am
Quoting Tomo1
I agree u may also look at longer term trading, based on technical but also fundamental analysis
Look like another nice person suggesting something to derviate from what I am concentrating on, before I can master my current method.
  • #10
  • Oct 21, 2009 7:38am Oct 21, 2009 7:38am
Stop thinking so much, it will improve your trading.
  • #11
  • Oct 21, 2009 7:42am Oct 21, 2009 7:42am
hey,
it doesnt matter what method u use ...
but the only skill that would distinguish u from other traders is one which can extract more profit when you are right + minimize ur loss when u are wrong , and actively managing ur positions is the only way (scaling)
when you ve learned and polished your market reading skill , the next step would be this ...

btw market reading skills will grow only with ur screen time ...
good day

edit:
plus listen to dopey's advice
To Live is the rarest thing in the world , Most people exist , that is all
  • #12
  • Oct 21, 2009 7:46am Oct 21, 2009 7:46am
Quoting Dopey
Stop thinking so much, it will improve your trading.
Perhaps, there is no shortcut. cheers Dopey!
  • #13
  • Oct 21, 2009 7:47am Oct 21, 2009 7:47am
Quoting maheswara
hey,
it doesnt matter what method u use ...
but the only skill that would distinguish u from other traders is one which can extract more profit when you are right + minimize ur loss when u are wrong , and actively managing ur positions is the only way (scaling)
when you ve learned and polished your market reading skill , the next step would be this ...

btw market reading skills will grow only with ur screen time ...
good day

edit:
plus listen to dopey's advice
Cheers macheswara. The secret is ... screen time....screen time and screen time!
  • #14
  • Oct 22, 2009 5:20am Oct 22, 2009 5:20am
I agree knowledge + experience are the key,
Quoting Dopey
Stop thinking so much, it will improve your trading.
  • #15
  • Oct 22, 2009 6:06am Oct 22, 2009 6:06am
Quoting Dopey
Stop thinking so much, it will improve your trading.
Yes. I believe it is wise words.
But now, I don't know what I should think more, what I shouldn't. LoL.
  • #16
  • Oct 23, 2009 10:44am Oct 23, 2009 10:44am
Without recieving solid direction on this topic, I have finally summarised a few points on how to improve trading performance. Wonder if someone may brainstorm something more for me.


Key strategy for improving trading performance

-------------------------------------------------------

1. Exercise Reasoning: Exercising reasoning is the only effective way to improve trading judgement. Need to understand the principle behind a trading method in term of market dynamic, rather blindly obeying a mechanical trading method. Blindly obeying a mechanical trading method cannot offer any long-term trading improvement.

2. Identify the key elements: Need to understanding what is the most significant elements that technically predict price movement. Focus your attention on these elements, rather than everything relevant to price movement.

3. Look for the Best: To improve performance, remove your attention from 60% success rate setups, concentrate on those setups with 80% or above success rate.

4. Backtesting and trading practise: Spend extensive time on backtesting and trading practise. This is a no-shortcut no-substitute step.

5. Self-belief: Need to have the belief of being able to achieve a high-level trading performance
  • #17
  • Oct 26, 2009 6:39pm Oct 26, 2009 6:39pm
Quoting dacouk
I find really useful to perform weekly and daily analysis to identify possible scenarios and key levels. I then go to my preferred lower timeframes and I take trades according to the weekly and daily plan. In this way I have a confirmation of the bigger picture which helps me filter out more false signals given on lower timeframes and I also have a better idea if the prices have the potential to keep going or just consolidate.

For example if I see a break of a resistence on a daily chart, I wait for a retracement and go on the 4h/1h charts to...
This is precisely what I do too. It is a very effective plan each week.
  • #18
  • Last Post: Jan 7, 2010 7:13am Jan 7, 2010 7:13am
I really enjoyed the discussion and learned more. Thank you everyone.
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