A Word of Encouragement for the ‘Average Trader’
I’m going to cut right to the chase…READ THIS!! Our good friend Norman Hallett from DirectYourMind.com has been an expert in the psychology of trading for years! He’s helped, and helping, thousands of traders a day to get their minds right. So read this article and check out Normans site.
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“Deep recession!”
“Depression!”
“End of the world as we know it!”
Anyone who’s tuned into CNBC or CNN has heard these statements of doom and gloom.
They may or may not be true.
We are not in control of what happens to the economies of the world.
We ARE in control of how we handle our personal finances in light of these possibilities and, as traders, how we choose to TAKE ADVANTAGE of all situations… including this one. No, ESPECIALLY this one.
We know that price action is a reflection of what is perceived “to be”, not what is. We know if we take a position and employ money management techniques, then
if we are wrong in our position, we will get pinched and not punched… and we’ll re-analyze and go again.
It’s the way of the trader.
For the trader, the greater the economic challenge, the greater the opportunity to better ourselves and our family… through our trading.
When most individuals are hiding behind excuses, the trader steps up to the plate.
We are lucky, indeed.
But don’t fool yourself. Being a trader, is not easy.
I look at markets in turmoil and I “feel” for the average trader.
The average trader has every good intention, but lacks the two basic elements to consistent trading success…
A formulated trading plan, whose elements are the components of a good trading system or systems, is the first element. And having the mental and emotional discipline to run that plan is the second element.
The GREAT NEWS for the ‘average trader’ is that it doesn’t take years to elevate your level of trading… months, yes, but not years.
The further GREAT NEWS is that we are in historic times.
The opportunities that will unfold over the coming weeks, months and years could result in windfall profits for those traders who choose to master the two elements mentioned above.
Shake-outs like we are experiencing now in the marketplace yield new super-trends that may be followed.. and ridden… by those who are prepared.
So should you “drop back and punt”, and stand aside while the market displays its current violent ways?
Only you know the answer to that.
Are your two basic elements solid?
Is your trading plan MEANT to handle extremely high volatility?
For any average trader… these are the type of markets that exploit your weaknesses.
FOR YOU, it’s time to re-group and prepare yourself for the opportunities that are about to present themselves as the smoke starts clearing.
Adopt a solid trading plan, based on a solid trading system. AND
Start now to make the development of your trading discipline a PRIORITY.
Without COMMITMENT to these two elements, you will not succeed on a consistent basis and will not be able to take advantage of the opportunities to come.
This is NOT the time for excuses.
It’s your time for admission… recognizing that you do, in fact, possess these two elements, or admit that you don’t and work NOW on shoring them up.
I’ve been trading for 25 years I can say with confidence that the opportunities that are about to unfold will be historic.
Fortunes will be made.
The Disciplined Trader with a tested trading plan and possesses solid trading disciplined will gather the money of The Average Trader who continues to downplay both.
It’s time to prepare.
Norman Hallett
Traders Toolbox: Elliott Wave Theory
MarketClub is known for our “Trade Triangle” technology. However, if you have used other technical analysis indicators previously, you can use a combination of the studies and other techniques in conjunction with the “Trade Triangles” to further confirm trends.
Elliott Wave Theory categorizes price movement in terms of predictable waves. Beginning in the late 1920s, R.N. Elliott developed his own concept of price waves and their predictive qualities. In Elliott theory, waves moving with the trend are called impulse waves, while waves moving against it are called corrective waves.
Impulse saves are broken down into five primary price movements, while correction waves are broken down into three. An impulse wave is always followed by a correction wave, so any complete wave cycle will contain eight distinct price movements. Breaking down the primary waves of the impulse/correction wave cycle into subwaves produces a wave count of 34 (21 from the impulse wave plus 13 from teh correction wave), producting more Fibonacci numbers.
Elliott analysis can be applied to time frames as short as 15 minutes or as long as decades, with smaller waves functioning as subwaves of larger waves, which are in turn subwaves of still larger formations. By analyzing price charts and maintaining wave counts, you can determine price objectives and reversal points.
A key element of Elliott analysis is defining the wave context you are in: Are you presently in an impulse
wave uptrend, or is it just eh correction wave of a larger downtrend? The larger the time frame you analyze, the larger the trend or wave you find yourself in. Because waves are almost never straightforward, but are instead composed of numerous subwaves and minor aberrations, clearly defining waves (especially correction waves) is as much an art as any other kind of chart analysis.
Fibonacci ratios play a conspicuous role in establishing price objectives in Elliott theory. In an impulse wave, the three principal waves moving in the direction of a trend are separated by two smaller waves moving against the trend. Elliotticians often forecast the tops or bottoms of the upcoming waves by multiplying previous waves by a Fibonacci ratio. For example, to estimate a price objective for wave III, multiply wave I by the Fibonacci ratio of 1.618 and add it to the bottom of wave II for a price target. Fibonacci numbers are also evident in the time it takes for price patterns to develop and cycles to complete.
Fire your broker and make money!!
Fire your broker and take control of your own money … and stop listening to Jim Cramer unless you want to lose more money.
We are serious. According to BARRON’S magazine Cramer has been consistent in one thing and that is underperforming the markets. This is the same guy who recommended buying Wachovia and we all know how that turned out!!
Check out this new FOX TV ad. FOX did not pay us a penny to run this YouTube ad on our blog, we just thought that it really said what a lot of us already know. The king (Cramer) has no clothes.
There is a simple antidote to market chaos and bad advice from your broker or Jim Cramer’s putrid picks and that is MarketClub.com. Try it out and check out our track record. If a positive road map and positive returns in turbulent times makes sense to you then try out a 30 day risk free trial to MarketClub.
I am betting you will be glad you did.
Adam Hewison
Co-Creator of MarketClub.com
