The Trader's Academy - by Traders for Traders

5 ways to deal with fear in forex trading:


1. Trust facts.

2. Walk away.

3. Do not just trade to be in the market.

4. pick one currency pair at a time.

5. Do not hesitake.



Yomi.

Trust your methodology, which is what you mean by trust facts I think. Fear arises from lack of confidence, and lack of confidence arises from incompetence. The very best way to deal with fear in trading is to first be absolutely confident in the knowledge that you have an edge which, if followed 100%, will result in a net profit after x number of trades. If you are fearful as you put on a trade, it usually means that you do not trust your methodology. If you are fearful even though you know you have an edge, then seek help or accept the realization that trading might not be for you. You have to conquer fear, especially with trading, because if you don't, as the old cliche goes, it WILL conquer you.

Thank you Sir

Hey there Tim, sorry its been a while and as life does, it gets busy. So made the time to read up on the thread either side of the All Blacks v Springboks RWC game.......

Good thread and particularly enjoying reading up on MACD divergence; so much so that Ive been researching it further for use on 5M charts.
Sad on the passing of Mark Douglas; and yep, Trading In The Zone is a great read. Ive got my three page sheet of TITZ notes out of his book - key reminders that I personally deem important to read a couple of times a week.

Regarding doji variations; are you using them much or just following a couple of majors such as the Shooting Star (aka Gravestone) and the Dragonfly?

In for a laugh, have a look at "You might be a day trader" from NinjaTrader

Inserted Video

Good for a giggle.
Has anyone else ever dreamed of trades... good or bad ones?
Of course, that question is for after watching the NT clip.

Kiwi

Hi Kiwi, good to hear from you, and congrats on the rugby, it was a great game, couldn't believe how well SA defended and the score so close despite the All blacks having the vast majority of the game. I think you should go on to win it now, I can't see either Argentina or the Aussies coming anywhere close if the All Blacks play well.

Dojis are powerful candles indeed, but like every other indicator, they are nothing if not backed up by others. A single Doji say on an hourly time frame is worth noting, but only if it apperas at a pre-determined S&R level, and then there will have to be a second confirming candle such as a shooting star. The way I use candles is really as a final indicator which tells me either than I have to be ready to see how the next candle or two closes, or as a final signal to open the trade. Everything else must be in place however. So I'm looking now at a trade from last week. I missed the initial move, so was waiting for a pullback to get in on the short side. In such a situation, I'll always wait for the price to push back up towards or to a big MA such as the 100sma or 200sma/ema. My smaller moving averages also come into play interacting with the bigger ones. So the price stalled, went sideways for a bit, put in a couple of higher lows, and pushed up towards the 100sma ( I had no intention of buying, the trend was down) As in this case, on the 30 sec chart, the 100sma was almost reached ( you never know how high this will push up to, but you do have the MAs ) the price put in a very sharp single down candle, but I don't trade yet, if it goes off from here, then it goes off without me, nothing I can do about it, but if it stalls, and comes back up again, I'm looking for it to make a lower high, which it does. Following a strong single positive candle, the next one is a Doji, and the next one is also a Doji, whilst the next drops back and closes beneath my 20ema.I've also managed to get a counter trend line in, so now, the sell is on, no hesitation, I pull the trigger after the 20ema is broken, and the price drops strongly away. A shooting star after the Doji would have seen me take the trade immediately upon its closing, they and the hammer coming after the Doji are the best candles to trade off, but again I emphasize, only if everything else is in place first.

Yes, the vid resonates, though I haven't seen Wall St once, neither do I intend to - my world is a million mil;es from that corporate nonsense. I am actually an ecologist by profession!

Take it easy and keep in touch.

The 3 best style of forex trading:


1. Position trading.

2. Swing trading.

3. Intraday trading.



Yomi.

4 trading psychology pitfalls that might blow your forex account:


1. The desire to be rich.

2. fear of losing.

3. The need to be right.

4. Being undiscipline.



Yomi.

3 ways to develop self-discipline in forex trading:


1. Keep the end in mind.

2. Direct your attention to what needs to be done.

3. Drive the negative vibes away.




Yomi.

Rehersal is your trading outcome out of every trade you take out of every new information you learn out of every loss or profit out of every new technical analysis you add to your toolbox, simply it's your long memory that is being trained to take decisions, trading experience is like an experienced car driver jumping into the driver's sit pulling the sitbuilt starting the engine and putting the first gear releasing hand breaks and finally accelerating with paying attention to your surrounding area your main focus is not how to drive these steps are imprinted deep inside your memory because of driving over and over again day by week by year it became a second nature to you, no wondering no hesitation you just act, when it comes to trading if you have took some steps in your past be sure that you are unconsciously being a slave to your habit, on order to be the trader you want to be simply set up a check list, and obey to your own rules it won't take you long until you notice your trades are getting better, work on your long term memory your long term trades will come to match a second nature, rehersal and rehersal.

7 forex trading secrets:


1. Trading hours.

2. Only one method.

3. Keep a journal.

4. All in the chart.

5. Follow your plan.

6. Risk management.

7. Do not be greedy.



Yomi.

hail

Effects of leverage on a $100 investment:



Leverage Level: Trade Amount($):

1. 10:1 > 1,000

2. 50:1 > 5,000

3. 100:1 > 10,000

4. 200:1 > 20,000

5. 300:1 > 30,000

6. 400:1 > 40,000

7. 500:1 > 50,000



Yomi.

Anyone out there who has been trying out a 10 second time frame, this may be useful if you, like me, use MACD on all your time frames. Normally, I use the standard 12, 26, 9, but for the 10 sec this just displays the MACD as an incomprehensible mess, so I use 65 , 100 , 15, which smoothes out the ribbon and more or less runs in synch with the bigger moves on that time frame rather than with all the noise. This configuration tends not to capture the diversion, but although I have traded 10 second diversion, all in all, the 30 second Tf will capture it when kept at the standard 12, 26 , 9. By the way, with MACD, I use both the Histogram and the ribbon, as they compliment each other very well, with the histogram sometimes showing diversion with the price where the ribbon doesn't. As always, MACD must be looked upon as just one weapon in your arsenal to be used in conjunction with other indicators such as moving averages, trendlines and fibonacci in my case.

Just a word about my moving averages. Without giving the ones I actually use, the ones I do use I use to either keep me in or keep me out of a trade, eg, not buying whilst x is still above the price on say the 10 second TF, and only buying when it is beneath the price and joined by y beneath the price on the next time frame up. I may trade this, especially if I have other indicators to confirm a trade, but it also depends upon where x and y are on higher time frames, and so all this will determine whether I take a trade, and how far I am expecting it to travel if I'm right. You've got to be a bit of a multi-tasker to use a multi-time frame system like mine, but like driving a car, when there are many actions we have to get used to performing simultaneously, it soon falls into place.

My only trade for today:

EURJPY (M15) +34.5pips


Trade Ideas:

1. Sync in pair.
2. Strength.
3. 5ema.
4. Momentum.


Cheers,
Yomi.

Divergence, hidden divergence and Fibos.

This morning's Dax London open. The 200ema on the 30sec here, on the 1 and 2 min TFs, was directly above the price. There's not too much explaining to do here, because it is self-explanatory. The Shooting stars are a clear signal to sell, and if you do sell on the 200ema in such a set up, the odds are firmly in your favour. A 12 pip stop loss here gets you above the Bollinger, my own criteria for stop loss placement which is why I use them. Try this out on a demo first of all to see how you get on. Yes the London open is tricky to trade, but it can be traded, especially when the price dips away from the 200ema to begin with, and then returns to it but finds support/resistance there. Candles with long wicks such as you see here are as good a sign as any that the price is soon going to move away. How far do you let it run? That's the tricky part and depends very much on what your higher time frames are telling you.

Useful tip for using MAs, and I'm using an actual example from today for this. Let's say you've a 50 and a 100 ( could be any type of MA, simple, exponential or whatever. You've missed the initial move, so your waiting for a pullback to get in. The price stops falling ( it works the other way around obviously) moves sideways for a bit, then breaks north towards the MA200 ( either on this TF, or the next higher one ) It peaks, then falls back fairly decisively to find support again before pushing up again to make a higher high before stalling again, but still either just beneath a major MA such as the 100sma or 200ema on a higher time frame, in this case the 30 sec, which means I'm following the move on both the 10 and 30 sec. Now the important thing to pay attention to first is to see whether diversion has been created by the second push up? If it has, and you have a lower high on MACD, you could be in business for a short, but you haven't got long. Can you also get a trend line in from the low, running along the bottom of the push down before the price made a higher high? If you can , then all the better, you can either short when the trendline has been crossed, or you can anticipate it and go early. What are the candles doing? A pin bar followed by a negative candle may give a great place in enter the trade. How about the MAs? It goes like this - the initial high of the pullback sees the MAs in their correct order, so for example 50 highest, then 100, 150, 200 as an example. However, when the price dips before it puts in the higher high, it pulls the 50 down beneath the 100, and when it pops up again, the MAs are no longer in their correct order because the 100 is now above the 50. If the price dips when the MAS are in the correct order, it's going to fall further and faster when the 100 is on top - it's called the ascendency of MAs, and believe me it works.

I'm giving quite a lot away here, but it's up to you to tinker around if you like the sound of this, because I'm not going to give any more away. The important thing to remember in all of this is that you know that the price is most likely to fall again because you have the big MAs, the 100/200 sma/ema bearing down on the price, and it is unlikely to break above these when the momentum is behind you. So you've got diversion, trend line, candles, and MA sequence - you should then be in business.

ps - thought I'd better post a chart shot of that, though I have taken off most of my MAs - sorry! This is the 20 sec, and hopefully you get the picture. This trade produced 60 pips very quickly. I never stay in long, especially with the Dax in this mood, better to ride it until it looks like it's going to pull back, and then you can always get in again, or even go on the long side if it looks it's worth it.

*grabs notepad* gold dust mate gold dust!

3 things to remember when trading bigger forex position:



1. Make sure you're in the green.

2. Take it slow and steady.

3. Focus on percentages rather than dollar amounts.




Yomi.

I know that every single person viewing this has one thing in common, and that's the strong desire to be a great trader. Remember, wherever you are right now with your trading career, chances are that you are nowhere near to achieving your full potential. Many have succeeded and have got to where you want to go, and many more will succeed. If you want it enough, you will be one of them, never stop believing that. Pursue your goal with as much or with more intensity than you have ever mustered in your life, and remember that learning how to trade takes you through a series of knock downs, the path is never easy. If you ever fall into despair and start believing that it is not something you can do, just remember that every single successful trader out there has gone through this - periods of self-doubt and uncertainty in our own ability and whether the path we are taking is the right one. Trading isn't easy, anyone who tells you it is is either a liar or a fool. It requires a great deal of hard work, knowledge, self-discipline, patience and an insatiable will to succeed. Those who fail, either do not understand this, or do not want to understand it. In trading, as with everything else in life, there are no short cuts.

Never give up if it's really what you want to do - you will get there!