What is the traditional course of study for a career trader?
- Thread starter kmiklas
- Start date
Yes, you're right, price can swing up and down very quickly a lot of the time.
But not if everyone wants it.
Then the probabilities say a) it's not going down so a tight stop can be safely used, and b) get ready for lift off.
Use a tight stop in such situations and get ready to regularly accept 3:1, 4:1 maybe even as high as 10:1 winners.
Do I get losers? Of course, but I take these in my stride because I KNOW, and I mean REALLY KNOW that when I get winners, more often than not they'll be big.
You say the reason why so many lose in this game is because they use small stops. The problem with large stops is you're going to get both winners and losers in this game but because of the large stop it's basically impossible (for most) to have significantly higher profits on winners than their losers. That is why when traders finally understand how to approach the markets they still can't get much above breakeven, if at all. The profits they earn when right basically cover their losses when wrong.
So I say the reason so many don't win overtime is because they use large stops.
As said above, all large stops do is stop you making major R/R when right. So the key to trading is to use tight stops at the right time then your winners will more than pay for your losses and have plenty left over in the plus column.
When is the right time - when everyone wants it (or doesn't want it for shorts).
L
lovethetrade
Do you reckon they get in AFTER the event or at the START of the event and DURING the event?
The reason why so many lose , is mental /phsychological.
send me a image with your set ups and maybe we can work together.
This is my style
Need somewhere to think out loud,
Who's they? The boys or me?
If it's the boys, they normally create the event, and I buy after the event when I see that people have been minimised and the majority have to buy to either cover shorts or to get long.
If you plan to buy before the event or during the event you can't use a tight stop hence can't get the potential of a great R/R. A tight stop can only be used after the event which is why I say buying after the event is the far more intelligent move because the tight stop can be used. If you buy before the event, who a) knows it's going to be an event, or b) when the low will actually be? if you buy during the event, same thing, you don't know that it will turn into an event and you also can't use a tight stop.
But just because you have an event doesn't mean everyone will want it after that even. So you have to study price action closely to see if there's evidence that everyone does want it. Tight price action, boxy price action (price trading in an imagined square box), hanging price action (where price just hangs at at elevated level for 2-4 bars) are all good signs that everyone in the market wants it and everyone who has size to buy is saying the same thing - shit, I'm in trouble here, I've got to buy some size and if I pay up that will tip my hand but if I don't pay up I know others will. They are foxed and in such situations there's only one thing to do, pay up, that's what the smart ones will do. The non-smart ones will work bids, hope, freeze, and then be forced to pay up at ever higher levels. And guess who will be letting them out of their predicament at ever higher levels? see, who says you can't be compassionate in trading and help others
I'm not saying any of this is easy, trading is not easy, even for the best because of the perversity that dogs ALL traders ALL the time. So work at it. Look for evidence of the 7th Law and the concentrate on what happens afterwards.
What you have said in this thread , and from knowledge and experience , you should be making $20,000 at least a week.
Some people are all talk and no trousers .You should have the discipline not to come to forums and be concentrating on that trade.This does not make sense , why somebody who can earn 20,000 a week , $500 an hour is wasting valuable time
This all does not add up
I am not trying to knock you
When people first get introduced to the 7th Law they think, ok got it, look for smackdowns and then trade the reversal of that move.
That's one way the Law works. But they normally miss the far more subtle part of it.
A strong market that keeps its strength is also a market that is minimising participation because traders want to get long but don't want to pay up, preferring to wait for some sort of reaction that 'normally always comes'. But it doesn't so a) keeps them out at present levels and/or b) forces them to pay ever higher prices if they have to get long (or cover shorts).
So think of the 7th law as working both ways. Personally I think the buy high trades are the better ones to spot and probably more profitable because then you (almost) know that everyone wants it whereas if price is coming off a low there's the higher possibility that the move back up is just a reaction to the recent down move.
That's one way the Law works. But they normally miss the far more subtle part of it.
A strong market that keeps its strength is also a market that is minimising participation because traders want to get long but don't want to pay up, preferring to wait for some sort of reaction that 'normally always comes'. But it doesn't so a) keeps them out at present levels and/or b) forces them to pay ever higher prices if they have to get long (or cover shorts).
So think of the 7th law as working both ways. Personally I think the buy high trades are the better ones to spot and probably more profitable because then you (almost) know that everyone wants it whereas if price is coming off a low there's the higher possibility that the move back up is just a reaction to the recent down move.