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Proper Trading Vs Profitable TradingIf I ask you what type of trading you would like to reach, I guess that the majority will pick the profitable trading as the main goal. And it will be not so good. Let’s think together why and discuss it in comments below this post. What does it mean profitable trading? It means that you trade for making money. It sounds like a good goal, of course, but for reaching it, you need to have knowledge and experience or a piece of luck. Novice traders don't want to spend time getting knowledge and experience. They want to start making money as soon as possible. That's why profitable trading as a goal is good for them. Yes, everyone can make a profit in trading. Even without knowledge, even without experience, even without trading plan and trading strategies. You need just a piece of luck for this. Everyone can make profitable trading. But what about making profit day by day, week by week, month by month and year by year? In this case, relying on luck is not a good idea at all. Just one day without luck can destroy all your profit and get all your money. Profitable trading as a goal is not so good if you don't have enough knowledge and experience and very risky without them. What about proper trading? Proper trading means you do the right steps in trading. It means you have the proven trading plan included tested trading strategies, the proper money management strategies. Your work is to follow your trading plan day by day. With such an approach, you will be able to avoid mistakes. You won’t need luck for making profit as your profit will depend only on your trading plan and how you will follow it. It is absolutely another picture, and you can expect stable and profitable trading in the long run - day by day, week by week, month by month. For this, you just need to do the right steps = follow your trading plan. That’s why when we talk about goals in trading, I would like to recommend set the right goals. Learn how to trade properly is one of them. Focus not on profit but focus on your trading. If you do the right steps, profit will come, and it will be stable income in the long run. If you rely on luck in trading, you will fail. It is just the question of time.
BITFINEX:BTCUSDEducation
by DLavrov
10
Forex Education: Stop Repeating Trading MistakesLet's relate our mistakes to Forex education. First things first, it's common sense that mistakes can turn into a positive learning experience. And also, they can help develop our skills while performing a task given to us. But in reality, it appears that learning from errors is hard to achieve because traders do not usually learn from their mistakes. Instead, they just keep on repeating them all over again. Now, for instance, a trader is starting to lose at the day trade, and the trader decided to widen stop loss. However, the trader knows that the decision made was a mistake. But still, the trader continues out of panic and results in doubling the risk. Nevertheless, the trader will go on and will adjust. After that, the trader might add more funds to sustain it longer in the later stage. In the initial journey on the trading industry, this type of dilemma happens frequently. And many traders get trapped in this situation. If a trader can't properly handle emotional stress, and clueless on managing a critical moment, this might result in committing the same mistakes and wrong decisions. The problem is, making mistakes does not happen once. But why do traders keep on repeating them? The answer is simple, and it's the way brain responses to errors. Brain's Responses Furthermore, in Forex Education, one type of response mind does is when making a mistake, in trading or not, is the wake-up call. In here, the problem-solving skills are awakened. Usually, it will process every single detail on what happened and the factors that caused the unwanted situation. Also, in connection to that, there is a phenomenon called post-error slowing. In here, attention sharpens, resulting in a long time to come up with the next step or a solution. Another possible response is the complete opposite of the first one. The brain shuts down completely because it perceives the error as a threat. And to prevent the discomfort feeling the mistake gives, the mind creates its own escape strategy. Usually, this happens to traders who focus more on positive feedback. Now, if you think a brain responded this way, try to rationalize, justify, or selectively omit information that shows something is wrong by attributing the result to external factors. Record Sheet The last topic of this Forex Education is all about noting every mistake. Start by creating a trading error record sheet. Then, make this as a part of a trading journal and jot down every unfortunate event the occurred. But always remember that dwelling in the previous mistakes will never improve a person as a trader. Instead, practicing on how to nurture a higher awareness of inner workings and precise planning is where the improvement starts. Learn everything about the trading market with ProfitStar Forex Trading Online Education. Join us and be a part of our pro-trader team!
Education
by Profit_star
EURGBP, A short trade explained. Price action & Technicals.Ok, going to throw in a little education from a trade I got on earlier. Nothing overly special from this trade. 30 pip move (and counting hopefully, the trade is still running). First of all, I always draw my Fibonacci tool from top to bottom, never bottom to top but I appreciate there are people who do otherwise. So drawing from swing high(0.90517) on the 1H chart, to swing low(0.89571).The fib tool I use is custom if wondering, only 3 levels included. I monitored the price waiting for a strong price action signal for a sell(large pin bar on candle in a down trend) The price moved through the .382 level once before dipping slightly and moving through to the 0.5 level. Notice I did not take the trade when it rejected on the first occasion as there was no strong price action candles. I took the trade on when the candle bar which is circled was closed. Always wait for the right price action!. The risk to reward ratio for this was very good, very little risk. Anything that went through the red highlighted area would have stopped me out, a 15pip stop loss for what I hope to be a 50+ pip move. This may have not been explained well but I will try do better in future, but in summary: 1. Price action - Personally the most important signal when trading. Wait for the correct signal - There are 1000s of trades to take. 2. Technical analysis - In this trade I used the fibonacci tool to identify an area that the price respected and rejected. 3. Money management/Risk reward ratio - Always respect this with every trade. Do not take on trades without ratio being in your favour. When combining the 3 of the above to your advantage you give yourself a chance at gaining from the markets. Thanks!
Education
by Craven64
2
AUDNZD Is Ready for next Move.AUDNZD is in Down channel pattern were in the lower time frame we bet Rising wedge pattern we need to wait for break down the pattern so that we can take them as per the market move everything was mention on the chart. Note one think the market can go further more upside till Down channel pattern resistance line there is really Big Stop loss but if market break downside then it will continue the trend. Note: This is only for Educational Purpose this is not Investment advice. Please support the setup with your likes, comments and by following on Trading View. Share Our Chart on All Social Media. Thanks Adil Khan
Education
by Make_Money_Guru_Bitcoin
7
USING MATH TRICKS ON YOUR CHARTS You can't count cards in casinos, but you can count bars in price action. No matter what pattern you trade, I would bet that if it falls out of of the pattern in less than 5 bars, it's not going to happen, so don't waste your time. Come back to it later. But, if it holds the pattern for 10 bars, it's probably going to continue in the pattern for 20 to 30 more bars. This little trick enables you to estimate how much time to expect your trading pattern to continue which is very useful when you're deciding whether or not you want to take the trade. For example, if you're looking for a range pattern to trade on a short-time frame chart, look for one that has been working the range for 10 bars and you can expect at least 10 to 20 more bars of similar price action. The MACD (Moving Average Convergence Divergence) is another math-hound I love on my charts. It looks at historical prices and gives you a picture of current momentum and direction. MACD crunches numbers on 4 different levels, and that might be hard to do in your head. But, have a look when the MACD line crosses zero, changing from positive to negative polarity, and you'll know the math is telling you something new is happening in the market right now. How does it take historical price numbers and tell us what's happening now or even be predictive of what's going to happen next? Mathematically, of course, it can compare what was happening awhile ago with what the price numbers are doing now, and detect change in the algorithmic patterns. When "change" is viewed as momentum starting to build, that math makes you smarter with your trade entries and exits.
Education
by Tradingstrategyguides
CAN MOVING AVERAGE GIVE CONTEXT TO PRICE MOVEMENTConsider the common situation in Forex when price makes a move for 50 or more pips in one direction. It could be a sudden move covering a large distance in just one or two bars, or it could move steadily over many days. Whether the move surprises you or steadily makes tracks in one direction, it happens that you notice this market might be trending. Will it continue? Or, should you expect it to suddenly reverse? How do you know? Trading is a speculative venture without absolute assurance of timing or direction for the market’s next move, but there is something you can do to stack the odds in your favor. Plotting a moving average gives context to changes in price, and provides a template for planning trades with expectations about what the market will do next. Look at these 2 charts. The first one, without any technical indicators, is a picture of rapid change in price. It would be impossible to know if it’s random, if it’s expected to continue going down, or if it might swing back in the opposite direction. In the second picture, two moving averages give context to that same price action. In the midst of a choppy market where price is jumping up and down over a period of time, the moving averages show me that price is holding to one side, giving me the information I need to know this market is in a down-trend and will be looking for lower lows. Going short is a good bet in spite of the volatility. Moving averages are guides, providing context and making the world of price action look a lot less random.
Education
by Tradingstrategyguides
TRADING BREAKOUTS WITH KELTNER CHANNELTrading Breakouts with Keltner Channel When it comes to breakout trading, Keltner Channel is a very powerful indicator. The keltner channel breakout system works best when volatility rises. However, the Keltner indicator measures not just the volatility, but it can also show anomalies in the price behavior. Since Keltner channel indicator is lagging in nature, we can use a secondary tool like the ADX indicator to give us more confluence. These two indicators can help us catch explosive breakouts. With the ADX we measure the strength of the breakout. Generally, and ADX reading above the 20 level is considered to be the beginning of a bullish/bearish trend. Any reading below 20 signals a period of consolidation. The ADX needs to continue to rise to suggest that the trend is strong. When the Keltner Channel is used in combination with the ADX indicator, you can trade breakouts with objectivity. Trigger conditions for buying breakouts: Keltner Channel bands need to turn flat. Price need to break above the upper band. ADX needs to cross above the 20 level. Follow the above trading rules if you want to avoid most of the false breakouts.
Education
by Tradingstrategyguides
1
TRADING PULLBACKS WITH KELTNER CHANNELTrading Pullbacks with Keltner Channel Trading pullbacks successfully can only be done in the presence of a strong trend. Using the Keltner channel indicator we can study how the price behaves around the upper and lower envelopes to gauge the strength of the trend. As you already learned when the price hugs one of the two bands and crawls along the band, we have a case for a strong trending market. In the chart below we’ve highlighted small retracements while the price hugs the upper Keltner band. Notice that the price retrace to the area around the 20-EMA. It won’t give you an exact price, but a price zone from where the price can potentially bounce and the bullish trend can resume. This remains a good way to measure pullbacks in price. Successful trading doesn’t require catching the exact turning point. For a better timing of our trades we can use the Stochastic RSI indicator in combination with the Keltner indicator for more confluence. The trade trigger is simply to follow with this Keltner Channel pullback strategy. Pull the trigger when the price retraces to the middle band and the stochastic indicator develops a crossover from an oversold territory.
Education
by Tradingstrategyguides
Is Taking Small Profits Bad Habit In Trading?Answer is, it depends! ( no surprise here ;) ) So now let's talk about, it really depends on what factors. What does taking a small profit means? If we talk about Forex trading then, taking anything less than 5 pips of profit is generally considered as small profit where usually people target roughly 30+ pips of gain in normal circumstances ( or taking profit well below the so called risk/reward ratio in range of 1:2 at least or healthy 1:3). Why is it not good? Keep on taking tiny profits compared to the strategy's original profit objective is certainly a path of destruction, sooner or later. For example, your trade plan is to short EURUSD risking $50 and trying to make $100 ( 1:2 risk/ reward ). Here you enter short @1.1350 and expecting the downside of at least 1.12. Now suddenly trade starts moving in another direction and it goes up just near your stop-loss of 1.1400. But luckily trade survives and now it is trading around 1.1350, right where it all started and testing your patience. Now volatility dies down and it just stays there and in the excruciating moments of impatience and despair, you close the trade @1.1348 with great sigh of relief. Here the problem is that if you keep on trading this way then one day, your account will be empty for sure. Because, here taking 2 pips of profit and keeping 50 pips stop-loss guarantees that you are paving the path of ruining your account, unless, you are sure that you are never going to lose a trade in your life! Because simply, just one bad trade will ruin your accumulated profit from 25 trades. So in any scenario where your risk/reward is not optimized with trading strategy, you are never going to win the game. Not all tiny profits are created equal ! If a trade plan is to take 100 pip profit and you have entered the trade from multiple entry points and taking tiny profit whenever market is giving you a good chance to cover tiny positions while keeping the core position active then of course it is good way to keep making money. What's my take. All things which makes your trading rigid are problematic IMHO. Those rigidities can be from anything, e.g. your trade plan is not flexible enough to account for change in circumstances, fixed entries, fixed exits and fixed stop-loss are equally harmful. Especially in current atmosphere of very low volatility and lack of meaningful long lasting 1000 pip trends, it is imperative to take small profits and there is a way to do it!. My own trading style is neither purely positional nor quick technical trading, it is kind of combination of many things. One thing to keep in mind is that most important thing is the 'Strategy' and everything else should evolve around it and not vice-versa. Because if you decide that my stop-loss is just 30 pip fixed and bla bla bla then you lose the flexibility in trading. A strategy should be in accordance with your personality, so that it keeps you at peace and in rhythm. Everybody's risk tolerance and personality traits are different and so are the trading styles. Copying some so called pundit's advice ( who him/her-self is not making money from trading ) of ideal trade plan and all other nonsense is totally useless. These preachers have put on so much BS all around that the beginner trader is surely going to be lost. To be a better trader, listen to eveybody but copy nobody. Keep knocking different doors until you find that magic! My take is - One learns from one's own inner quest. Trading is transcendental. The more you know yourself, the better trader you become. Everyone can be a good trader but very few will because, few are ready, prepared and patient to toil to find the true depth :)
Education
by BombayBulls