Blog

The Ups and Down of Becoming a Trader

Site Administrator | October 13, 2011

Responsive image

TraderTalk – 10.13.2011

We had three great traders join us today for a session of Trader Talk where they shared about some of the ups and downs in their trading careers.  Please note that we have included a summary and recap of some of their answers below in transcription for the benefit of those who prefer to read and review.  Special thanks to Rick Saddler at HitandRunCandlesticks.com, Tony Peterson of theIntentionalTrader.com and Frank Stanley of DTITrader.com for sharing with our patrons today.

How long did it take you to find a trading method that worked consistently for you?

Frank – Started out with day trading, but that’s hard to do when you’re a clinician seeing patients.  Then day trading started falling apart.  It was phenomenally hard to be a day trader part time.  Gravitated from day trading to swing trading.  (Just  stocks at the time.)  Decided from a bad experience that swing trading wasn’t the best way for him either.  Eventually started looking at options and the leverage with options and swing trading options.  Eventually went to DTI and started learning about Futures. Learning about Futures was the turning point.

Tony – Counting the lessons learned, it took a long time (almost 7 years.)  The turning point was turning the information he learned into knowledge. Each indicator has value, but the more indicators he used,  he found that it was more cumbersome and less obvious.  It was information, but not knowledge.  Finally decided that if you can’t make a rule and keep it for more than a day or two, then you shouldn’t look at the indicator that gives you that rule anymore.  It took about 12 months to strip everything out and get down to what he wanted to know and understand to add to his system.  It took about a year for him to go from “done” with trading, to trading 5 days a week.

Rick – After he started trading as a hobby, he would follow other traders and absorb information from different traders, and chat rooms.  After the second time of going broke from trading, he decided there had to be a way to look at a chart and be successful.  He added every indicator he could on a chart, and then sat for weeks just flipping for charts trying to find a common sense method and patterns in the market that matched those indicators.  If an indicator was not consistent, he would delete it.  He did this for weeks until he had nothing left on the chart but price action with support and resistance.  He finally got to the point where he could go to trading full time. Trade tomorrow what you see in the chart today.

Give us an example of a major up and down that occurred in your trading career?

 Rick – The major up was when he got over the fact that you can’t beat the market. And you have to accept that.  You can’t beat the market each and every day, each and every time.  You’ll have streaks where you’ll win one after the other, but that one loss will take all of the wins away.  Also, when he realized that trading is a business.

Frank – Major down was when he reached periods of time when he thought he knew the market so well that he would not follow his own rules and he would pull stops. The major up was a psychological management of emotions.  You need to learn to be like a machine.  Look at the numbers, follow your rules based on the numbers.  Understand your emotions, realize where your weaknesses are.  Flex your approach.

Tony – The down was the first seven years where he blew out three good sized trading accounts, but in the long run, he considers that an up.  It was a learning experience that led him to where he is today.  The real upside for him was when the pain and fear, frustration, and anxiety that had defined him as a trader was slowly replaced with confidence.  It was a slow process. There was no “ah ha” moment.  The upside came slowly and was built with consistency.

Rick: How has understanding Japanese Candlesticks improved your trading?

It was one of the things that made the big difference.  Once you understand the Japanese candlesticks, you understand the emotions of other traders.  That becomes very powerful for you.  The price action of the Japanese candlestick tells you what is happening right now.  Once you learn how to read the patterns, you will discover the vision into other traders and what they are trading.  It allows you to anticipate their attitude.  (Bullish or Bearish.)  It is one of the most pure indicators that exist.

Tony: What advice would you give a trader that is struggling to make the move from part time to full time?

90-95% of people who try to make that move, fail at it.  Part of his experiment was to start a trading business instead of trying to be a “trader.”  His success in running a small business, made him think of trading as his business and he was the principal trader of his own trading business.  He turned it into a business, ran it like a business. He approached trading in a different way, he gets a paycheck from his business at the end of the week.  Make sure you’ll benefit from quitting your job, your business must generate enough profits to replace your job.  When it starts costing you money to go to work, that’s when you’re ready to trade full time.

Frank: How have you adjusted your option strategies during the current volatility and what advice would you give to a beginning options trader?

One thing is to cut lot size.  When there is more question or volatility, take less risk, and the easiest way is to reduce contract or share size.  Because of volatility, he has changed from doing a lot of credit spreads, to a lot of debit spreads.  (To protect yourself on the downside.)  Doing diagonal calendar spreads are also helpful during volatility.  Learn how to read the numbers and the charts, and keep it simple.  Start with simple strategies.

To view the session in it's entirety please click the link below:

Learn about Candlesticks, Futures Trading and Options Trading

Be sure to join us for our next event "Bull vs. Bear Shootout" by clicking on the link below:

Register for:  Options Education

Cheers,

The TradingPub
"Trade, Talk, Learn - Cheers to Success"
Follow us on twitter

TraderTalk – 10.13.2011

We had three great traders join us today for a session of Trader Talk where they shared about some of the ups and downs in their trading careers.  Please note that we have included a summary and recap of some of their answers below in transcription for the benefit of those who prefer to read and review.  Special thanks to Rick Saddler at HitandRunCandlesticks.com, Tony Peterson of theIntentionalTrader.com and Frank Stanley of DTITrader.com for sharing with our patrons today.

How long did it take you to find a trading method that worked consistently for you?

Frank – Started out with day trading, but that’s hard to do when you’re a clinician seeing patients.  Then day trading started falling apart.  It was phenomenally hard to be a day trader part time.  Gravitated from day trading to swing trading.  (Just  stocks at the time.)  Decided from a bad experience that swing trading wasn’t the best way for him either.  Eventually started looking at options and the leverage with options and swing trading options.  Eventually went to DTI and started learning about Futures. Learning about Futures was the turning point.

Tony – Counting the lessons learned, it took a long time (almost 7 years.)  The turning point was turning the information he learned into knowledge. Each indicator has value, but the more indicators he used,  he found that it was more cumbersome and less obvious.  It was information, but not knowledge.  Finally decided that if you can’t make a rule and keep it for more than a day or two, then you shouldn’t look at the indicator that gives you that rule anymore.  It took about 12 months to strip everything out and get down to what he wanted to know and understand to add to his system.  It took about a year for him to go from “done” with trading, to trading 5 days a week.

Rick – After he started trading as a hobby, he would follow other traders and absorb information from different traders, and chat rooms.  After the second time of going broke from trading, he decided there had to be a way to look at a chart and be successful.  He added every indicator he could on a chart, and then sat for weeks just flipping for charts trying to find a common sense method and patterns in the market that matched those indicators.  If an indicator was not consistent, he would delete it.  He did this for weeks until he had nothing left on the chart but price action with support and resistance.  He finally got to the point where he could go to trading full time. Trade tomorrow what you see in the chart today.

Give us an example of a major up and down that occurred in your trading career?

 Rick – The major up was when he got over the fact that you can’t beat the market. And you have to accept that.  You can’t beat the market each and every day, each and every time.  You’ll have streaks where you’ll win one after the other, but that one loss will take all of the wins away.  Also, when he realized that trading is a business.

Frank – Major down was when he reached periods of time when he thought he knew the market so well that he would not follow his own rules and he would pull stops. The major up was a psychological management of emotions.  You need to learn to be like a machine.  Look at the numbers, follow your rules based on the numbers.  Understand your emotions, realize where your weaknesses are.  Flex your approach.

Tony – The down was the first seven years where he blew out three good sized trading accounts, but in the long run, he considers that an up.  It was a learning experience that led him to where he is today.  The real upside for him was when the pain and fear, frustration, and anxiety that had defined him as a trader was slowly replaced with confidence.  It was a slow process. There was no “ah ha” moment.  The upside came slowly and was built with consistency.

Rick: How has understanding Japanese Candlesticks improved your trading?

It was one of the things that made the big difference.  Once you understand the Japanese candlesticks, you understand the emotions of other traders.  That becomes very powerful for you.  The price action of the Japanese candlestick tells you what is happening right now.  Once you learn how to read the patterns, you will discover the vision into other traders and what they are trading.  It allows you to anticipate their attitude.  (Bullish or Bearish.)  It is one of the most pure indicators that exist.

Tony: What advice would you give a trader that is struggling to make the move from part time to full time?

90-95% of people who try to make that move, fail at it.  Part of his experiment was to start a trading business instead of trying to be a “trader.”  His success in running a small business, made him think of trading as his business and he was the principal trader of his own trading business.  He turned it into a business, ran it like a business. He approached trading in a different way, he gets a paycheck from his business at the end of the week.  Make sure you’ll benefit from quitting your job, your business must generate enough profits to replace your job.  When it starts costing you money to go to work, that’s when you’re ready to trade full time.

Frank: How have you adjusted your option strategies during the current volatility and what advice would you give to a beginning options trader?

One thing is to cut lot size.  When there is more question or volatility, take less risk, and the easiest way is to reduce contract or share size.  Because of volatility, he has changed from doing a lot of credit spreads, to a lot of debit spreads.  (To protect yourself on the downside.)  Doing diagonal calendar spreads are also helpful during volatility.  Learn how to read the numbers and the charts, and keep it simple.  Start with simple strategies.

To view the session in it's entirety please click the link below:

Learn about Candlesticks, Futures Trading and Options Trading

Be sure to join us for our next event "Bull vs. Bear Shootout" by clicking on the link below:

Register for:  Options Education

Cheers,

The TradingPub
"Trade, Talk, Learn - Cheers to Success"
Follow us on twitter