For both individual trades, and trading in general, there is a strong inclination to over-estimate our own ability to make huge returns, as well as the market’s ability to produce those returns. New day traders especially like to wait for what looks like an ideal opportunity, and then expect big things from that trade. But […]
The best way to learn is through a mentor; someone who has been successful and is willing to personally teach you and keep you on track. Unfortunately, the people who want a mentor far outnumber the mentors out there accepting students. Finding someone to personally teach you trade is difficult. But if you already a […]
Trade long enough and you will start to notice some usually regular and potentially destructive habits in your trading. You may chase trades, entering at a later point than your strategy dictates because you fear missing a trade. You may have trouble holding through a few gyrations in the market because you are impatient in […]
The internet provides a massive resource for gathering information on brokers, markets, strategies and financial education. This is a positive thing, as it allows almost anyone with patience, discipline a strong work ethic to compile a trading system that works for them. With so much information though–and misinformation–it is important to remember that no one […]
While I do watch for price breakouts, I am always on the lookout for false breakouts…because I want to trade those more. Most traders view false breakouts as a bad thing, a market phenomenon that cuts into their profits or increases their losses. I propose you look at false breakouts as an opportunity. In my […]
Most day traders know about limiting the risk of their trades, but capping daily losses is a practice traders could also benefit from. By capping risk on each trade and day, the trader is taking steps to make sure that no single trade or single day ruins their month, or worse yet, their account. To […]
Traders are always looking for the next winning trade, but often it is the trades not taken that ultimately determine the success of a trader. Some days have strong price trends, and the potential for winning trades–if you trade in the same direction as the trend–is quite high. Other days the price action is not […]
Day trading stocks for years I found I always traded best in the morning, then usually gave some profits away in the afternoon, only to make some back at the close to basically finish up where I was at in the morning. It took me years to realize that trading all day is not a […]
When a strategy provides a lot of signals, such as the one I use for trading a 1-minute or 5-minute chart on the EURUSD (see: Forex Day Trades – October 7 and subsequent posts), some traders may find it beneficial to add an indicator to help them figure out which signals to take and in […]
There is a wide of array of sentiment indicators which you can use to generate trade ideas and confirm trades. One of the most popular ones is the long-short ratio. It shows the percentage of traders who are long and short a particular currency pair. Over time we can see how a currency pair’s price […]