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How to Break Through in Trading

  #24 (permalink)

baltimore md
Posts: 8 since Dec 2017
Thanks: 5 given, 1 received

kellys View Post
I'll share what helped me progress and hopefully by doing this it de-jams some of you guys...or not

When I think back to when I first took up trading, I am uncomfortably embarrassed at my stupidity then.
I was ignorant and took what the industry fed me as given.
That was my first mistake. You should put into question everything! Break it down.
The painful thing is that by the time you realise all this, you are 5 years on! Less or more depending on personality, intelligence and environment.

Ichimoku is an 'indicator'.
What does it indicate?
It indicates trend direction, momentum and support/resistance...CONSIDERING PRICE ONLY.
Price only? That was my second mistake!
Does it make sense to look out the back window of a car when you're driving it? How many people have you seen doing that? None!
When you trade price only, it is akin to driving a car staring out the back window.
To become profitable you need to look out the front window!
If you couldn't see the problem before with back testing price alone, then you should see it now.

You do however need price to trade.
The error I was making back then was using price incorrectly. Mistake number three.
You can now see why many (including myself) get caught in a really nasty loop.
The most useful attribute of price is that it indicates how the market feels about certain information.
I'll give an simple example:
I remember a few years ago I was trading USTs (I'm a rate and currency trader only - I'll elaborate on this in a further post), and a piece of flow hit the wires. It was news on the Ebola virus.
It was interesting to see how the market reacted to that flow. The market obviously worried about an outbreak or it spreading cross-borders, because they began to bid treasuries. This bid continued on through London and well into the US session.

As I went along I began to realise that I couldn't make money trading price or derivatives of price alone, but I needed to focus on what drives prices.
Here is how it works:
How can one expect to make consistent money by focusing only on price movement, or output?
Start focusing on input and your trading will improve.
We need to trade FORWARD, not BACKWARD!

I'll post further later in the day and cover some other things that helped me progress.
Enjoy the weekend!

Should I be journaling what moved the price and why?

Last edited by Jeremy1984; December 11th, 2017 at 11:01 PM. Reason: typo
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