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Trading Psychology Introduction to Trader Psychology There is evidence of technical analysis dating back to the 17th century. The candlestick charts most of use everyday to trade were created in the 18th century by a Japanese rice trader. By this point one would think technical analysis should result in more profitable traders and lead atleast a quarter of price technicians to a profit. However, this is not the case and in fact the opposite is true as most traders fail, even after years of studying price action. With this said, it is obvious learning how to read a price chart alone is not what leads to consistent profits. So what is it that seperates the very few succesful traders from the so many failures? Is it their strategy, their money managament skills, IQ, were they born with a different skill set than most, do they work harder than most, or are they just plain lucky? All of these sound plausible, but are they really the driving factor behind consistent profits? The short answer is no, none of the above. Perhaps we have been looking for the answer in the wrong place all along. In fact, most traders never even consider the possibility that it is their attitude or mental habits which prevent their success. What truely seperates the winners from the losers has nothing to do with external factors, but rather what goes on internally while observing and engaging the market, in other words; a traders mentality. "If the next bar is a bull follow through bar, the bulls have a 60% chance of making a profit. If the next bar is a bear bar that means....." Absolutely nothing! Unless you can structure a trade plan, and abide your plan as the market unfolds, without questioning yourself or your plan, and execute it flawlessly. Most beginning traders believe if they study harder and learn more setups, they will eventually become profitable. This is the fallacy of price action analysis. In fact, most economists and price analysts do not make good traders. Why? Because they form rigid rules and ideas as to what prices should or will do, and in turn fail to recognize and accept the "now opporutinty" the market is offering to traders who are open to all possibilities, including a lower probability event. Even more debilitating is the false belief that they can pick out winning trades, and avoid the losers, which leads to cherry picking through a traders edge. If the market spends most of its time with a probability between 40-60%, why is it so hard to generate a consistent profit? Understanding prices and their tendencies is only half the battle of becoming a Professional Trader. The other half and harder to develop, is the traders mindset. What makes a good trader is not only his knack for reading prices. It is the ability to flow with the market as it is unfolding, and the art of doing the right thing at the right time; without questioning himself. If the market is only offering X amount of profit, he takes it. If the market is unfolding in a way that he did not expect, he exits. He is willing to take a loss, and more importantly does not care what happens to "himself" in the market. He does not take it personally, and carries on throughout the day executing trade after trade. Continued...
Education
by tradersmentality
The calm before the storm BTC has been ranging in this area for a while now with the 8000-8100 level so far acting as a titanium support; the combination of a falling wedge and strong support means I would typically place a long here. However, when btc chadded its way up from 6.8 to 8k without retesting it left a huge gap between the range. I am currently still holding onto a short from 8800 and will add to my short with stops if support breaks but will flip into a long if descending wedge plays out. Expecting massive movement if support is broken. This is also a no trade zone imo if not already in a position.
BITMEX:BTCUSD.P
by TradePod
BTC - Crazytown Plan 12.1.17 Trading StradgyBTC -> Bullish After a rejection and whales taking profits BTC Dropped for two days from $11,200 - $9000 Area.. I anticipated a further correction for another two days, But since this market is completely insane we rebounded alot sooner, maybe due to the futures trading anticipation. Now we are back in an uptrend continuing -> Here is how we trade this market. BTC Long over the previous highs Stop loss below $11,000 Target 50% or $15,000 After that we will swap sides to take BTC short @ the highs. Good luck traders!
BITFINEX:BTCUSDLong
by TheCryptAlpha
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