Thursday, April 20, 2006

>Think like SUCCESSFUL TRADERS

Trade what U see….not what U believe.!

Successful traders think in probabilities.

U don’t have to know what the market is going to do to make money. In fact, U CANNOT
know what the market is going to do, so trying that would only interfere with your thinking in
probabilities.

The techniques you use should give you an edge, which is nothing more than a probability that the trade will go in my favor.

Take every clear trade setup according to my edges; this guarantees that the probabilities will work in my favor.

One is never right or wrong, because right and wrong on trade outcomes has absolutely nothing to do with successful trading which requires thinking in probabilities.

Trading edges are like a coin that is rigged to give heads more often than tails. Taking a trade setup is like flipping the coin. The concept of ‘right’ and ‘wrong’ do not apply to trading, anymore than it would apply to the rigged coin coming up tails.

Don’t try to predict outcomes. By taking every clear trade setup, I generate a sample size sufficient for the probabilities to work in my favor.

Do not seek ‘certainty’ on trade outcomes, because certainty does not exist in markets.

Always pre-define my risk prior to taking a trade. If a trade does not work, it’s history and patiently await the next trade setup.

Have profit objectives on every trade, but no beliefs as to what will happen next. If a trade does not go in my favor, I am no more concerned than a casino operator would be about losing a single hand of blackjack.

The market is your own personal casino. By taking all of ur clear trade setups, the casino is rigged in ur favor.

Every moment in the market is unique…anything can happen!

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This are some of the ideas I discuss in EagleEye seminar. Visit here.

3 comments:

rajesh69_astro said...

Hi Good English not backed by strategy. Infact all TA is about working with probabilities and risk and reward ratio.Specially when the market is liquidiy driven fundamentals dont help beyond a point. TA is paralysed with huge green candles ! So whats way out......

Any strategy ??

rajeev said...

Whatever is written is practical and used everyday in trading.

Technical trading needs a kind of training and mental makeup to fit inside the skull and is not grasped in a few days or even a few years for many.

People who look for certainity or fixed outcome would never get to trade usefully.

Anyone with a more rational approach of enhancing his chances to win and place small % amount in each trade can grow and make a fortune,

rajeev said...

a very relevant article..
denotes what happens when one gets very excited in trading and trades compulsively ... or makes too much or deadly losses....

http://www.newscientist.com/article/dn9019?DCMP=NLC-nletter&nsref=dn9019

the solution lies in keeping the calm and thoughtfulness...

ofcourse knowing in detail what one is doing has no alternative :D