Elliott Wave Secrets
Technical Analysis without Elliott Wave is like driving through LA without a map.
Elliott Wave is the Master Chart Pattern and most other patterns can be found as a part of the Elliott Wave system. Understanding how your charts respond to Elliott Wave can give you a glimpse into the future.
The complete list of “Elliott Wave” rules has something to explain every possible combination of waves, however we don’t really care about all the obscure rules because there is no way to tell which combination will happen next, what we want are the most reliable rules and patterns with the most predictable outcome.
There are secrets within the waves, clues that we can count on to know with high levels of probability where the charts are going next. But.. Elliott Wave is definitely not something that you can learn in a blog, so I’ve put together a live webinar for any who want to attend.
I guarantee it will be a valuable use of your time.
Go here to Register:Â Â http://www.lotsofpips.com/elliott-wave-secrets/
Trading Psychology – Greed
In the years I’ve been trading and training others, I can see clearly that Trading Psychology is the most important determining factor in the success of an individual trader. My focus ios on the highly leveraged Forex Market, and I have recognized many of the aspects of Greed & Fear that keep people form realizing their dreams in trading on their own.
I have found that there are both good and bad points to greed and fear. Fear is not always a bad thing, fear of heights keeps you from falling of buildings, however you can have too much of a good thing.
In this 2 part article I will list the pro’s and con’s of Greed and Fear while trading the forex market, starting with Greed.
Good Greed:
- Keeps you in winning trades
- Keeps you trading when you are in the zone
- Keeps you learning, studying and focusing on fine tuning your strategies and styles
- Gives you persistence in trading even after you have blown up an account
- Gets you involved in the FOREX market in the first place
Bad Greed:
- Keeps you in losing trades far too long
- Keeps you from locking in profits on a winning trade.
- Makes you ignore your money management, and “bet the farm”
- Gives you un-realistic expectations of returns on your time and money and create a money management plan that is certain to blow up your account
- Keeps you from using stop losses, without stop losses you can easily increase your winning percentages, but your losers will wipe out any profits over time.
These are just some of what I have noticed as the good and bad elements of greed and fear when trading forex. Stay tuned for the next Trading Psychology issue focusing on Fear.
Let me know if you have any to add to this list.
Forex Coaching Adventures
I was monitoring a forex coaching session from one of my coaches a couple of years ago and I heard the craziest story. I’m so grateful that I didn’t have to learn this lesson myself.
Wile I was listening, I heard the student relate what happened to him.
He said that he was trading on black Friday (day after thanksgiving) and he had an $11,000 live account. He was just scalping for 10-20 pips and only using a 15 pip stop loss, but he was trading with 7 standard lots (~$70/pip). He was caught unaware when the market closed for the weekend while he was still in the trade. He told how that was a very long weekend as he waited for the market to re-open on Sunday afternoon and get back in control of his trade.
Well the market did re-open, and he was sitting there watching in horror as he saw the market open, not at the price it was when it closed on Friday, but 170 pips away, IN THE WRONG DIRECTION. Because the market had gapped over his stop loss, the trade was still active. His available and used margin were eaten up in that instant devastating blow and his trade was automatically closed with a loss of $11,600. Leaving him with an account balance of -$600. He had done what he thought was impossible in forex and had lost more than he had in his account.
His broker called him up the next day and asked him to deposit enough to cover the debt.
He and I learned some valuable lessons from that experience:
- Even though I have stop losses in place, I need to be very careful when staying in trades over the weekend.
- I should always avoid trading around holidays with my live account.
- Scalping is not a sustainable or consistent way to trade, things can happen fast when your trading with more lots.
Some people think that laws are there to restrict us, but I know that my trading laws are in place to keep me trading safe.
Good luck in your trading and have an awesome day.