How can we improve our trading skill ?
- Thread starter Peter brandley
- Start date
A good way to improve TA skills is to go over the day's charts.
Where did I get it right or was it a fluke ?
Why did it become a loss ?
Could I have avoided that bad trade and how ?
You get the drift. I bet not many do this and the ones that do are more likely to succeed. Hard work, it is.
Where did I get it right or was it a fluke ?
Why did it become a loss ?
Could I have avoided that bad trade and how ?
You get the drift. I bet not many do this and the ones that do are more likely to succeed. Hard work, it is.
Biggest changes came for me in two areas: automation & backtesting was the first.
Testing proves/ disproves very quickly.
Automation removes emotional reactions - and also teaches about emotional discipline.
Much later on came the market skills, which I attribute to the thinking & writings of 3 people:
1. An old trader I know privately
2. Jesse Livermore
3. Ed Seykota ( some of his best gems are on the web, not in books)
There's many others who've also written fantastic insights along the same lines, and to be honest, its all very simple.
But its taken years to soak it all in, and be able to apply it all correctly.
General conditions - tape - timing
All the components of a trading system are important, since they all need to be present & applied correctly to profit.
But I consider market selection the most important component.
Reason being, if you can't pick big moves, you'll never get to ride big winners.
Its taken me around 15 years to see where & how, the big money is really made.
And, to develop the patience to wait weeks or months for the right opportunity.
Ironically, the things I've ended up using for selecting markets, are actually things I discarded as useless in my early trading years.
In my automated trading days (very short term systems), the focus was on the 'edge', ie the system stats, average trade etc.
Now, my focus is on 'which market', 'being right', 'knowing when you're right' and 'how to be right more often'.
Testing proves/ disproves very quickly.
Automation removes emotional reactions - and also teaches about emotional discipline.
Much later on came the market skills, which I attribute to the thinking & writings of 3 people:
1. An old trader I know privately
2. Jesse Livermore
3. Ed Seykota ( some of his best gems are on the web, not in books)
There's many others who've also written fantastic insights along the same lines, and to be honest, its all very simple.
But its taken years to soak it all in, and be able to apply it all correctly.
General conditions - tape - timing
All the components of a trading system are important, since they all need to be present & applied correctly to profit.
But I consider market selection the most important component.
Reason being, if you can't pick big moves, you'll never get to ride big winners.
Its taken me around 15 years to see where & how, the big money is really made.
And, to develop the patience to wait weeks or months for the right opportunity.
Ironically, the things I've ended up using for selecting markets, are actually things I discarded as useless in my early trading years.
In my automated trading days (very short term systems), the focus was on the 'edge', ie the system stats, average trade etc.
Now, my focus is on 'which market', 'being right', 'knowing when you're right' and 'how to be right more often'.
If you want to improve your trading skill in forex industry, try practise account(Demo account), this really gives good knowledge of trading as well you can also find which strategy works good by applying in demo account.
My goal in trading has always been to be able to do it without stress, anxiety, fear, hesitation, worry, or anything else that would impact my health or my ability to trade long-term.
Having recently achieved this life-long trading goal, I'm now certain that improving trading skill is, for many traders, not the reason for losing.
I developed my own trading strategy from scratch over the course of about 7 years and, after it was done, I honestly believed I had the best system in the world and that I was among the most skilled traders in the world. My skill and incredible accuracy at finding entries and exits, however, didn't lead to actually executing those trades. And no matter how many times in a row I was right (while not taking action) I could never convince myself in my heart that I was a good trader and that this next one would do anything but lose...probably. So I continued on with anxiety, stress, or fear over the possibility of loss (even very small loss).
There are three parts to success. Skill is the first. If you're not capable, you won't succeed.
Desire is the second. If you don't want to succeed you won't even show up to the table.
The third is optimism and the belief that your system and your ability to use it are "probably right" instead of "probably wrong."
I think a better question for traders to ask is "How can we improve our trading optimism?"
Now I'm trading without fear because, after a loss, I am able to still believe that I'm usually right and that this loss just happened this one time.
In the past I had fear over entering a trade because I believed that I'm usually wrong and that a recent loss was a sign of a future trend of losses... even if it was my first loss in a while or came after 5 or 6 "would-be" wins in a row (had I acted on them).
From what I've read on ET, I think many of you actually have winning systems and, to some degree, can accurately analyze the markets at whatever level you're capable. I think optimism, and belief in good things to happen rather than in disaster to happen, is the one thing that would allow everyone to actually follow their system the way you do during virtual trading and finally get the results your back-testing promises. It's possible that improving your skill is not giving the results you want because a lack of skill is not the problem. The problem is a pessimistic explanatory style of both good and bad events in trading.
Having recently achieved this life-long trading goal, I'm now certain that improving trading skill is, for many traders, not the reason for losing.
I developed my own trading strategy from scratch over the course of about 7 years and, after it was done, I honestly believed I had the best system in the world and that I was among the most skilled traders in the world. My skill and incredible accuracy at finding entries and exits, however, didn't lead to actually executing those trades. And no matter how many times in a row I was right (while not taking action) I could never convince myself in my heart that I was a good trader and that this next one would do anything but lose...probably. So I continued on with anxiety, stress, or fear over the possibility of loss (even very small loss).
There are three parts to success. Skill is the first. If you're not capable, you won't succeed.
Desire is the second. If you don't want to succeed you won't even show up to the table.
The third is optimism and the belief that your system and your ability to use it are "probably right" instead of "probably wrong."
I think a better question for traders to ask is "How can we improve our trading optimism?"
Now I'm trading without fear because, after a loss, I am able to still believe that I'm usually right and that this loss just happened this one time.
In the past I had fear over entering a trade because I believed that I'm usually wrong and that a recent loss was a sign of a future trend of losses... even if it was my first loss in a while or came after 5 or 6 "would-be" wins in a row (had I acted on them).
From what I've read on ET, I think many of you actually have winning systems and, to some degree, can accurately analyze the markets at whatever level you're capable. I think optimism, and belief in good things to happen rather than in disaster to happen, is the one thing that would allow everyone to actually follow their system the way you do during virtual trading and finally get the results your back-testing promises. It's possible that improving your skill is not giving the results you want because a lack of skill is not the problem. The problem is a pessimistic explanatory style of both good and bad events in trading.
Love this.
Heh, I have worked so hard in my beginnings (going over day charts) that I even had carpal tunnel syndrome (http://en.wikipedia.org/wiki/Carpal_tunnel_syndrome) and effectivity of such approach was questionable...
Better to study statistics and quantitave strategies, working with Excel or R or Matlab. Why? Because if we succeed, then everything can be automated and we have lot of spare time, freedom.
I never wanted to end like guys who are forced to sit in front of monitors all day long with thick glasses and "hanging bellies" ...
Find by trial and error what works for you bit by bit to build a viable system that you can use. Some I guess build profitable systems and ruin it by not being able to stick to the rules.
So start with time frame and then .....................
There are many alternatives imho not just one.
So start with time frame and then .....................
There are many alternatives imho not just one.
Many traders think that devoting hours analyzing the charts ,reading books and studying courses will improve their trading skills. Putting in hours is necessary in the beginning but it won't necessarily increase your profit potential if you keep repeating the same mistakes. To improve your trading performance, seek help of someone who can guide you like any person you know who trades,chat room or forum you can prefer. Plan your strategies and implement it,you can start with demo account until you see profit in it. Monitor your trade everyday,take screenshots of your trades with entries,stop loss levels,targets and fundamental/technical notes to make it easy to review anytime you want.
%%
Good points. I like to use auto drawn moving averages; but i hand draw 2 of those in a note book.Rich Dennis said ''its the job of the market to wreck computer systems'' Even a system requires plenty of discretion, like which market to trade/invest.
And discretion helps anywhere , one of my favorite accurate data providers was off by 60+/ million shares, for one day .
, 