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Rick Redmont Bases Trading on Wyckoff Theories Off-floor trader Rick Redmont gained his first experience trading stocks as a college student during the bull market of 1961. "I had $10,000, which turned into $20,000. I followed the Chartcraft point and figure book-but it didn't really matter what you bought. Tom DeMark Relies 100% on Market Timing Trader and consultant Tom DeMark has invented dozens of proprietary technical indicators over the years and relies strictly on the technical principles of market timing for his research and trading. In fact at one point in his career, DeMark went through the CFA program (certified financial analyst), but chose to never complete it. Choosing a Trading System That Actually Works I believe a good trading system should be considered for inclusion in one's portfolio in order to potentially enjoy superior returns. Finding a good trading system, however, can be a very difficult process. George Lane Still Trading Off Stochastics at Age 75 George Lane completed his 47th year of trading in December 1996 and is still going strong. After many years of trading in the grain pits in downtown Chicago, Lane has shifted to screen trading during his "retirement" in a small community about 80 miles south of Chicago. Angelo Reynolds Scalps in the Eurodollar Pit As a trader in the Eurodollar futures pit at the Chicago Mercantile Exchange, Angelo Reynolds cites mental toughness and courage as two of the necessary factors to successful pit trading. "I knew I always wanted to be involved in the markets," Reynolds said. Grant Noble Reads Mass Media for Contrarian Signals Futures trader and author Grant Noble looks to the mass news media in order to garner signals of major market bottoms or tops. Only, he looks to the media with a contrarian perspective. Linda Bradfore Raschke Focuses on Technicals After spending six years trading on the floor, first at the Pacific Coast Stock Exchange and then at the Philadelphia Stock Exchange, Linda Bradford Raschke shifted gears and moved to an off-floor office in 1987. After trading her own money for several years, she moved into the money management side of the business in early 1993. Raschke, along with her partner Rick Genett, manage about $25 million. Glenn Neely Bucks Traditional Elliott Analysis Glenn Neely locks horns with traditional Elliott wave theoreticians and has developed his own approach to trading the markets, which he calls NEoWave Theory. Neely first encountered the Elliott wave theory back in the early 1980's while he was working off-shore in the oil industry. Key to Day-Trading: Have Your 'Team' in Place Day-trading is a very serious business; if you don't have all the right ingredients in place before you begin trading, you're dead. One of the most important aspects of the day-trading business is your "team:" Lee Gettess Focuses on Controlling Risk Trader Lee Gettess focuses on risk control as a major factor in determining his success in the commodity markets. However, it wasn't always that way. Gettess received his introduction to the commodity futures markets via a telephone call from a broker. George Fontanills Incorporates Options to Lower Risk Trader George Fontanills first began utilizing options in order to go "delta neutral" on his futures positions, which would allow him to "still sleep well at night." Since he began using options in conjunction with his futures trading, Fontanills believes he has found a way to accelerate his profits while decreasing his risk. Cynthia Kase Relies on Proprietary Technical Indicators Trader and consultant Cynthia Kase relies on a series of proprietary technical indicators that has developed for her trading signals. Kase makes her trading decisions strictly based on these technical indicators and doesn't rely on fundamental analysis at all. Walter Bressert Reads Market Via Cycles & Oscillators Walter Bressert earned a college degree in economics, which taught him "economists don't know much about the way the world works." An active trader for many years, Bressert relies on cycles and oscillators in his intraday futures trading, in which he primarily focuses on the S&P 500 contract. Jake Bernstein: Psychologist Turned Trader Jake Bernstein, one of the futures industry's best-known traders, started trading "by accident" he told FWN. Bernstein was a psychologist who responded to an ad in the newspaper regarding "ag futures." A broker started calling him and Bernstein opened an account. Day-Trading: Not What You Think The day-trader is a cross between an extrovert and an introvert with both characteristics in balance. The introvert aspect is depicted by the disciplined workaholic with a reclusive concentration. The extrovert aspect is depicted by an aggressive, competitive, self-motivated individual striving to be the best in a selective profession. How an Options Specialist Prepares for the Market Opening At 6:45 a.m. the traffic already is building on the expressways that feed into downtown Chicago. From inside your car, the only real difference between winter and summer at this time of day is that in summer the sun is already up. In the dead of winter, traders only see the sunshine on vacation. George Angell Keys in on Volatility and Liquidity Volatility and liquidity are the two elements independent trader George Angell looks for in a market to trade. Currently, Angell exclusively trades the S&P 500 futures, putting on intraday trades only, never holding positions overnight. "Liquidity and volatility are the two things you have to have. You can't day-trade something like oats--it wouldn't work" Angell said. Larry Williams: Training Key for Trading, Running Trader and marathon runner Larry Williams sees parallels between successful trading and successful marathon running. Williams, who recently completed his sixteenth marathon run, pointed to "pain and agony" as being two of the obvious similarities between trading and long-distance running. Persistence Pays Off for Joe Stowell According to independent trader Joe Stowell, persistence and courage are two key characteristics necessary for success in trading. Persistence certainly has paid off for Stowell, who traded part time off and on for 20 years, before leaving his job as a school teacher to trade full time. Ben Warwick's "Event Trading" Keys in on News While many traders focus either on technicals or fundamentals as they develop their trading strategies, trader Ben Warwick focuses on a market's reaction to news. Warwick has developed his own method of trading, which he calls it "event trading." Gary Wagner Uses Candlesticks to Measure Sentiment Japanese candlesticks offer a "mathematical expression of psychological market sentiment" to trader Gary Wagner, who utilizes these Eastern technical indicators in conjunction with Western tools to actively trade for himself. Lost in Forex Loss An email prompted me to consider the significance of taking responsibility in trading. There is a natural tendency for most people, in any area of life, to not take responsibility for results and behaviors that appear negative. We want to see ourselves in a good light and it is tempting to try to avoid responsibility for acts that we consider bad. Easy Way to Cut Losses I have successfully given up two unhelpful behaviors, one was smoking which I stopped 10 years ago; and the other was drinking alcohol, which I gave up last year. Most people these days agree that smoking is a bad habit, but equally most people still consider drinking to be perfectly healthy in moderation. How To Think Like A Winning Day Trader What makes the best traders successful? Are they "lucky"? Have they discovered some "secret" indicator? No. They've learned the truth about trading. Trading success is a simple as 1-2-3. What is Paper Trading? Over the years I have trained many traders and I always advise that they spend at least three months paper trading before they go live with real money. Now even though I advise this I have never had a student actually do it. They all give up on paper trading after a few weeks and go live. Richard Rhodes' Trading Rules I must admit, I am not smart enough to have devised these ridiculously simple trading rules. A great trader gave them to me some 15 years ago. However, I will tell you, they work. The rules are simple. Adherence to the rules is difficult. Should I Override the Forex Strategy? Today was a perfect day to test your discipline: We went long at 1190.00 and the reversing order was placed at 1192.25. Prices moved up to 1192.00 and reversed. One hour later we tried to reverse at 1191.00. Again prices moved up to 1190.75 and reversed. John Murphy's Ten Laws of Technical Trading Which way is the market moving? How far up or down will it go? And when will it go the other way? These are the basic concerns of the technical analyst. Behind the charts and graphs and mathematical formulas used to analyze market trends are some basic concepts that apply to most of the theories employed by today's technical analysts. Arthur Hill on Goals, Style and Strategy Before investing or trading, it is important to develop a strategy or game plan that is consistent with your goals and style. The ultimate goal is to make money (win), but there are many different methods to go about it. Why Watch Market Indicators? A common and effective way to gain perspective on stock price fluctuations is to compare the movement of your stocks to that of indices or market indicators. About 100 years ago, as the number of individual stocks grew, the need to measure how the stock market performed became obvious. How to Make Money Shorting Stocks in Up and Down Markets Now I am very much aware that many market players do not like to short stocks. This bias against the short side of the market is totally understandable, especially given the fact that the widespread reluctance is garnered and perpetuated by the various exchanges and the other powers-that-be. What Are Commonly Traded Securities Stocks -- When you buy stocks you essentially own a little share of the company you just bought. The more shares you buy the more of the company you own. When the company whose shares you have bought makes a profit you will receive that profit in the form of dividends. Intraday Trading Tactics In this lesson I want to discuss intraday tactics that you should be aware of when you start to trade intraday. By intraday I mean very short time frames such as 1 minute, 5 minute and 15 minute charts. This will apply to traders who actively trade and probably trade frequently during the course of the day. High Low Breakout Technique This technique can be used for any market that has a decent daily range. If you look at any chart, what do you see? You should see a succession of bars that are doing one of three things. The Trend is Your Friend We traders have to try to achieve a state of impartiality. We have to accept that we will have losses as readily as we will gains. Reaching a stage where you can comfortably accept losses, in the knowledge that your method of trading will produce profits in the longer term, is the state we have to aspire to. Trading is not an exact science. Who Trades The Markets Let's just clarify what is meant by the term trader, sometimes called retail trader or day trader. This is an individual who trades the financial market whatever they may be using their own money. They may or may not be dependent on the results of their trading for their income. This does not include professionals who work for institutions or who manage other people's money. Momentum Trading One of the most basic and widely used indicators is that of momentum. Before I go on to tell you how we can use the momentum indicator to trade with, I want to explain the difference between a leading and a lagging indictor. The Mastery Of Self Trading We do everything for a reason. The reason behind any act is, for the most part, unconscious. If we want to change a behaviour we need to identify the reason, the underlying objective, and examine it. We need to examine it to determine whether this objective, this assumption, supports us in what we want to do now. Understanding Stochastics The foreign exchange markets move when some force makes one currency either more or less valuable than another. The cumulative purchase and sales of a currency cause it to move up or down and to become more or less valuable in relation to other currencies. Anticipating the Market and Execution I divide trading skills into two distinct elements: anticipating the market and execution. The anticipating part is reading the market, whether through charts, systems, technical indicators or intuition. Anticipating/reading the market is the trading skill that most of us focus all our energy on, and it is the subject covered by most trading books and seminars. Where To Place Your Trading Stop Many traders have a problem defining where they should place their stop loss. They have no problem entering a trade but often have a problem defining where they should take profits or cut their loses. In this lesson we will cover some of the popular methods of choosing a stop loss. Option Trading: Thinking "Outside the Box" Wouldn't it be great if we could buy an option with five months left until expiration and sell an option with 2 months left until expiration for the same price? You couldn't lose. Well we can't. I love options spreads so much I realized something very important. We can buy a spread that has a lot of time value left at almost the same price as we can sell one with less time value left. Day Trading Strategy A market that is trending up should have higher peaks and higher valleys. The majority of bars should also have higher highs and higher lows. In a down trend the market should have lower valleys and lower peaks and the majority of bars should have lower lows and lower highs. What is Simple Moving Average? This is the most widely used and is simply calculated by adding up a set of values and dividing the total by the number in the set. This is the average. Movement of this average is effected by adding the next new value of the set and subtracting the first value of the set and again dividing by the same number of values in the set being studied. What is Support and Resistance It is very important to understand the concept of support and resistance. In up trends, every time price drops to the up trend line and then resume their advance, the trend line has acted as support to the price up trend. Support can also be found at prices of previous support or resistance. Exiting a Losing Trade A market that is trending up should have higher peaks and higher valleys. The majority of bars should also have higher highs and higher lows. In a down trend the market should have lower valleys and lower peaks and the majority of bars should have lower lows and lower highs. Forex Bid/Offer Normally when you look at your charts you only see one price and that price is the bid price. Some types of charting software are capable of displaying the offer price but most commonly the price you see is the bid price. Understanding Forex Trends Trend is the easiest and the most difficult thing to understand. The difficulty arises because of the time factor. Whenever we talk of trend it has to be related to the context of time. Building a Forex Trading System About two weeks ago I got an email from a trader explaining his trading method and asking me for some advice on how to improve on it. On the surface of it, there wasn't much to his approach but he had been trading profitably for a few years and that got me interested. Forex Envelopes What we are going to show here is the use of Envelopes, which form trading bands. The particular trading bands we are going to use will be based on exponential moving averages. This will help us form a method to trade. This is basically an intraday strategy, which works well on the 10min/15min time frame. Forex Pip Auction Game Problem Here are 4 fail-proof ways to solve the Pip Auction Game problem, and to guarantee that you're not going to play it again. You have heard this before, and it's true, but until now you still have not lived by this rule. You should never risk more for pips than they are worth. You should cut your losses short. The "M" And "W" Trading Pattern The "M" and "W" trading pattern is a great little pattern that occurs with enough frequency for you to add it to your trading tool bag. What is the Best Business Opportunities Did you know that more and more business opportunity seekers worldwide are discovering the powerful profit potential of Foreign Exchange trading? In this business, there are no employees to hire, no advertising, no products to stock, no downlines to fill -- just you, an Internet connection and a computer. How to Choose an Online Forex Firm Forex is a special kind of the world financial market. Trader's purpose on the Forex to get profit as the result of foreign currencies purchase and sale. But, what to look for in an online Forex Firm: The Basics of Currency Trading Currency, like other commodities, are traded in futures contracts. Simply, these are contracts to deliver a fixed amount of a particular currency, in a given month in the future, at a price agreed upon and paid for today. Change Over Days - Day Trading I read somewhere that when Michael Jordan was making an advert that required him to miss the basketball hoop a number of times; he just couldn't do it, he couldn't not get the ball in the hoop. Understanding Rectangles on Forex The rectangle contains price movement between two points in a rectangular shape to which we add lines to signify the upper boundary and lower boundary. These lines should be horizontal. Buying and Selling Currencies Trading opportunities in the forex market deserve serious consideration as a diversification strategy for your portfolio. How to Be a Highly Skilled Forex Trader Trading, like any endeavor, any skill, is learnt through doing. We learn through trial and error, through having experiences and evaluating and learning from those experiences; and of course, our learning is accelerated if we have the support and advice of someone who is further along the path of development. How to Make Consistent Forex Profits One of the mistakes I consistently made in my early years as a trader was to try to make too much money in relation to my trading capital. Developing Forex Trading Skills At some point, if they last long enough, all traders discover that successful trading is not the inevitable result of a good trading strategy or system. If all we needed was a good system or indicator we would all be successful traders. Yet clearly we are not, far from it, there are very few traders making their living consistently from the markets. How to Make Consistent Profits Futures Trading The issue of direct access is an important one and it becomes more important the more short term your trading is. The market can change from a state of seeming paralysis to one of shocking volatility and activity in a flash. The Cycle Of A Trend In this lesson we are going to look at the different stages of a trend and how it can help you position yourself for a trade. It is commonly accepted that there are four stages of a trend. These stages make up a cycle and each cycle has smaller cycles contained within them. How to Be a Successful Forex Trader Just what does it really take to become a successful trader in today's markets? To answer that question adequately one must first understand the mind of a successful trader and what his/her thought processes are. Today's markets have changed dramatically just in the past few years and those changes are due to a variety of different factors. How to Lose Money on Forex I read somewhere that when Michael Jordan was making an advert that required him to miss the basketball hoop a number of times; he just couldn't do it, he couldn't not get the ball in the hoop. Forex Trading Basics: Supply & Demand Fundamentals The objective of currency trading is to exchange one currency for another with the expectation that the market rate or price will change such that the currency pair you have bought has appreciated in value relative to the currency you have sold. The Dow Theory You will hear a lot about the Dow Theory as you travel through your trading career. Dow himself never actually used the phrase. That came later as analysts began to use the term. Glossary of Forex Terms and Commonly Used Expressions Forex is one of the fastest growing areas for news traders to get started. The main reason for this is the low entry level (only a few hundred dollars for mini accounts) and the fact that it is fairly straightforward to trade. Fundamental of Technical Analysis Chart is lines of graphics that sketch the market movement in a certain period where the x-axis is the time and the y-axis is the price. Naked Options Now let's look briefly at the result of selling naked calls. In this scenario, the call writer simply sells the call and does not own any of the underlying stock to cover the short call. If the stock plummets, the call writer is very happy and relieved. Forex Basic: Symmetrical Triangles Symmetrical chart patterns can be found in almost any market and any time frame. They normally signify some indecision in the market and as the pattern develops it is common to see a decrease in volume. Responsibility in Forex Trading An email in response to my article prompted me to consider the significance of taking responsibility in trading. There is a natural tendency for most people, in any area of life, to not take responsibility for results and behaviours that appear negative. The Anatomy of an Option Any time you read anything about options, it is incumbent upon the author to provide a brief introduction. This article is no exception. Buying and Selling Options Now, let's consider stock and stock options for a moment. Consider the ubiquitous XYZ Corp., currently trading at $95 per share on 2/1/03. If you pay $4 per share for a March call on 100 shares of XYZ at the $100 strike price, you have acquired the right to buy 100 shares of XYZ for $100 per share, any time before the third Friday in March. The Joy of Options Owning stock has only two, maybe three, possibilities. The stock goes up. Or the stock goes down. Or, as a third possibility, it does a little of both. If you buy a stock, all you want it to do is go up. Understanding Options Options are one of the oldest trading vehicles man has ever used. Around a 1000 B.C Aristotle Thales predicted by the stars that there would be a bumper olive harvest and bought options on the use of olive presses. Pivot Point Trading You are going to love this lesson. Using pivot points as a trading strategy has been around for a long time and was originally used by floor traders. This was a nice simple way for floor traders to have some idea of where the market was heading during the course of the day with only a few simple calculations. Forex Trading Pivot Points Those of you who have been trading for a while will be familiar with Pivot Points. During this lesson I want to go over how to find a Pivot Point and also a slightly different method of using them. First let's look at how you calculate a Pivot Point. What Are the Differences Between Trading and Gambling? Many people think that trading is similar to gambling. Is this really the case? For example, let's take a look at Black Jack. If you start with $10,000 gambling capital, placing bets of $100 per hand and play 100 hands per day, how long will you last? Types of Forex Trading Orders Placing orders correctly is probably one of the most important aspects of trading. It is vital that you understand and use the correct order when you trade. What I Learnt Losing $60,000 My First Year as a Full-Time Trader During my first year as a local (independent trader) on the floor of LIFFE, I bought and sold 8804 FTSE futures contracts, about 40 contracts per day on average. The result was a loss of $61,620 or -$267 per trading day. Being a Technical Analyst Trading is not an exact science. You can't do X and get Y every time. It is as much an art as it is anything else. There is no magic formula. Trading is all about probability. It is the art of correctly applying a set of carefully thought out rules and allocating the probability of that event to result in success. Forex Trend Detection Long term profitable Forex trading warrants long term goals and objectives. One good idea is to have an excellent trend based trading system. Just having one will not really work out if you do not follow it in a disciplined manner. Investment Strategies: Technical Analysis and Fundamental Analysis The two fundamental strategies in investing in Forex are Technical Analysis or Fundamental Analysis. Most small and medium sized investors in financial markets use Technical Analysis. What is Forex Marginal Trading Marginal trading is simply the term used for trading with borrowed capital. It is appealing because of the fact that in Forex investments can be made without a real money supply. Forex 101 For those unfamiliar with the term, Forex (Foreign Exchange market), refers to an international exchange market where currencies are bought and sold. Fundamentals of Forex Trading Trading is not an exact science. You can't do X and get Y every time. It is as much an art as it is anything else. There is no magic formula. Trading is all about probability. Forex Trading System Now you have decided that you are going to trade a particular security and you need to find a way of entering and exiting the market. So, how do you approach it, do you just jump in with a gut feeling or do you use some kind of system to help you make the decision. What is Futures Futures are normally traded in contracts and are a legally binding agreement between a buyer and a seller. The seller must deliver the specific agreed upon asset at a future date but for the price agreed today. Why 90% of Forex Traders Go Bust Believe me when I tell you that 90% is a conservative estimate. Some sources have it as high as 99% of traders losing their initial starting capital and I have also read that not only do over 90% of them lose their money but also 10% actually go bankrupt. One Simple Thing That Can Improve Your Trading I am going to share with you a simple discipline that can really help your trading. This simple little act is often ignored by new traders and overlooked by experienced traders. How to Choose a Forex Broker? When it comes to getting started in forex trading, there are quite a few things that you have to consider. The first thing to do is to find and choose the right broker to help you in making your trades. Beginners Trading Guidelines Successful Forex trading is a long term investment which can produce excellent returns if traded with control, discipline, patience and consistency. Your target should be to make substancial profits over the course of anything over 3 months. Successful Forex Trading with Pivot Points Pivot Points are calculated on the previous days move and trades are entered when the market hits a support or resistance line of the pivot point providing your OB/OS indicator is in agreement. What is Forex (Foreign Exchange) Trading? The vast currency market is a foreign concept to the average individual. However, once it is broken down into simple terms, one can begin to easily understand the foreign exchange market and see what a profitable avenue of income participating in the trading of Forex can be. Fundamentals of a Trading Plan Trading the Forex market has many benefits over other financial markets, among the most important are: superior liquidity, 24hrs market, better execution, and others. Traders and investor see the Forex market as a new speculation or diversifying opportunity because of these benefits. What You Should Know About Forex Trading How difficult is it to make money trading the Forex market? How much time does it take to actually be able to make a living trading the Forex market? These and other important aspects of trading are to be discussed in this article. Why Trade the Forex Market and Why is it Attracting So Many Participants? The Forex market is vital to the general prosperity of the free world economy. Why? Some $1.5 trillion dollars worth of international currencies are bought and sold every single trading day. It is by far the largest traded market in the world. Chart Reading Basics To be profitable in today's world technology and advancement, one must be proficient and reading and more importantly understanding chart patterns and basic technical indicators. Below is just a few basic points to your understanding the technical analysis of currency chart reading. Forex vs. Futures The global foreign exchange market is the largest, most active market in the world. Trading in the forex markets takes place nearly round the clock with over $1 trillion changing hands every day. It is the main event.
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