The 3 C’s of life: choices, chances and changes.

You must make a choice to take a chance or your life will never change.

Face 2011 with this attitude and you will be fine.

Also remember this…

“If you do what you always done you will get what you always got”

I have taken a hard look at what I have done in the past versus what I plan to do this year and I am really excited for what lays ahead.

I believe that you need to do the same, especially if you have struggled with results of late. You can’t expect to get different results if you keep doing the same thing.

So what choices do you need to make right now?

Here are a few suggestions from my side…

Trade with discipline or don’t bother to trade at all, and leave the emotions at home

The fact is, the unsuccessful trader is most likely using the same indicators and techniques that the successful trader is using. Yet only one of them gets consistent results. So why is this then? The unsuccessful trader, not realising it at the time, is trading those same indicators emotionally and fearfully.

That’s really all there is to it!

The unsuccessful trader doesn’t realise this though, because they are looking in all the wrong places. After all, if they acknowledge this simple reality, then it means that they need ‘fixing’; and it’s a lot easier to fix a combination of indicators on a chart, then to take a hard honest look at themself.

So begin the year by taking a good hard honest look at yourself and your recent trading results.

If you want to achieve different results, then you need to do something differently this year.

Did I mention not to get emotional?

It’s not about YOU.  It’s about price movement. Something that you have absolutely no influence or control over, so stop getting all emotional each time you trade. Your only job is to analyse the ‘probability’ then apply a ‘trading strategy’, consistently and with discipline.

Do the job right and you will make money – it really is as simple as that. Do it wrong though – bring your emotions and ego to the party – and you simply have no chance at all.

Trading is a simple numbers game. When you mess with the odds though and don’t let the dice roll out each play, then you simply have no chance of letting the numbers work their magic.

Although most traders will admit that The Traders Mindset is key to winning in the long-term, most believe they can simply ‘handle it’ when things go wrong.

Too late!

The truth is that once emotional, you become irrational, and simply will not make rational decisions – so forget it – prepare properly so you know what to do when required and you do so unemotionally – or be prepared for large losses.

Speaking of losses then…

Take your losses like a ‘man’

Or a wo(man). Seriously though, we need to man up and accept that losses are simply part of the deal – I mean really accept this.

Be warned now. More traders fail from their inability to accept losses then any other single factor. We have to leave our egos behind when trading. It really cannot be about us if we are to have any chance of success.

Remember.

To win the War you need not win every battle!

I know that you all recognize this reality. But I also know that most of you still struggle with it.

Work on your approach – Your mindset. Prove to yourself that this is in actual fact the case.

So how do you do this in 2011?

Well you need to take a 2-3 week period and be totally committed, not to the overall trading results in the context of pips gained or lost, but rather to the process itself, of staying committed to the trade parameters, and to letting those loses simply happen without any attempt to prevent them from occurring at the time.

Look long term – forget short term.

The focus must be on ‘testing’ the theory more then testing the outcome. By committing to this strategy – your focus now becomes less results orientated and because of that, the process is less emotional. Now your sense of failure will no longer be measured in terms of pips earned or lost – but rather in how well you managed to stay the course and leave those trades alone, in attempting to prove or disprove this theory.

Now your ego is not fighting you on each and every individual loss.

Turn your knowledge into experience this year.

Make a choice to make a change.

All the best,

Chris.

1. Analyze 5 simple criteria
2. Rate your probability set up from this on a 1-5 scale
3. Adjust your position size accordingly
4. Take unemotionally and with far greater confidence.

www.the-traders-mindset.com

If you are one of those traders who keep making the same mistakes over and over again, then this video is for you.

My course ‘The-Traders-Mindset’ is also an invaluable and essential guide for you so check it out through the link below this video once you have finished watching.

The-Traders-Mindset

Recomended Alert Service and Live Trading Room

For now I have these two really neat videos to share with you.

The first one Brian Mc Aboy from Inside Out Trading sent with me and it is really neat because it sheds light on why traders often do the very opposite of what they know they should do.

Click here to watch the video

You also know that I believe a decent Trade Planner is probably the most important part of your trading…well the other video that Matthew Buckley from the “Top Gun” crew put together on how to set up a trade planner, so check that out here…the first vid is an intro but the next one is the one I am referring too. It is an option trade planner, but the principles are the same.

Watch the Top Gun Trade Planner here

Cheers,

Chris.

“Hi Chris,

Thanks for this I found it really interesting as although I’m not going to take up your great offer it re enforced  to me exactly how I trade FX 10- 20 pips targets per day 5 lots at a time I’m in most trades for no more than 20 minutes, which has and is producing really well for me and I  average around 400 pips a month total working for a couple of hours a day, this concept is exactly how I view the markets, get in get out enjoy your life. So if it isn’t broke don’t fix it.

I spent a good couple of years trying to be in everything checking the markets all the time feeling like I missed out etc. now it’s great I’m in and out banked and done, the reason for the email is that I hope more Forex traders adopt this philosophy and stop doing like I did trying to chase every pip going it’s not good for your health! And also invariably it just fills your broker’s coffers not yours!

Keep up the good work and thanks for the updates.

Regards

Martin.

That’s what I like to hear, an independent trader who has got a plan… To read the rest of this reply and my summary or what you need to remember at all times, go to my blog post at     http://www.traders-live.com/blog/ Cheers,   Chris.

The Independent trader or the Dependent trader

Which type of trader you are will dramatically affect the potential money you can make in the markets. In fact, it could well determine what the rest of your life will look like, whether it is how long you work for someone else, when and where you vacation, or where and how you live. You may think that’s an exaggeration, but the reality is those who take initiative can positively affect the outcome of their lives (and their trading) as opposed to those who let others determine the course of their lives for them.

It is important to note that anything requiring little to no effort will produce limited, temporary or no results. Conversely, anything requiring you to think and act for yourself will produce lasting and permanent results.

Trading, whether Forex, stocks, or other markets, especially proves this true. Returning to the two types of traders, they illustrate very common mindsets — which one represents you?

The Dependent trader is looking for the easy way, wants to make a quick buck, or strike it rich — but never wants to put any effort into the process of accomplishing such things (if such things even exist, and it should be argued that they do not).

Dependent traders will follow the crowd, trade based on hot tips, seek out automated ‘millionaire-making’ trading programs, listen to all the news experts and blindly place ‘can’t lose’ trades (which do lose), all with no plan, no thought and no understanding of what they’re doing. Naturally they’ll become frustrated with their losses and failures and do the only thing they can think to do: they give up.

Dependent traders are the trading equivalent of lottery ticket buyers; they know full well the odds stacked against them, but they believe anybody can get lucky, so why not them? Needless to say,

Dependent traders exert little control over their lives and have little chance for financial success. On the other end of the spectrum is the Independent trader. This trader wants to have control over their financial future and has learned (or will learn) how the markets work, which approaches to trading the markets really work, and how to empower themselves to trade without relying on others for advice or tips or news.

An Independent trader understands and believes that only they can maximize their odds for success and only they can achieve their financial and life dreams. They will seek out and learn from others, educate themselves, learn from failure and strive to accomplish greater things. It should be noted, however, that everyone has a little bit of the Dependent trader in them at some point. The difference being, the person on track to become Independent may take up with a mentor or lean on a reliable education source at the outset – but as their knowledge grows, the Independent trader will begin to apply what they’ve learned completely on their own.

The Dependent trader never will.

Three simple steps to becoming an Independent Trader:

Step One: Create and execute a trading plan. Whether you want to day trade or trade at the end of hte day, or once a week — decide what fits BEST in your daily schedule and then determine what sources form #2 and #3 below best align with your plan. Don’t try to apply day trading methodologies to end of day trading and vice versa, as you’ll likely discover they don’t and won’t work.

Step Two: Seek out 2-3 reputable education sources. We will provide some to you – but the goal is to identify one that you can understand and trust. Learn everything you can from those sources. Then, learn to apply it on your own.

Step Three: Learn from and test out multiple methods for trading. You are unlikely to succeed wihtout some basis in trading methodologies, especially when utilizing technical or fundamental indicators. The steps above will require time and money investment.You should consider them your trading education costs — it is far better to invest in yourself than to lose money too easily in the market.

I believe that the Authors contributing to this site are amongst the best and will give you everything you need to become an Independent Trader so check them out and always look for what you “need”. Don’t get caught up in buying more of what you already have, or stuff that is of no use to you.

Oddly, the reason is NOT because they aren’t smart enough or because they don’t have the ability.  It is because of something that happened along the way that they haven’t addressed.  They are aware of it to a degree, because they can make money in their trading.  The problem is that they have a decent run and then get cocky and reckless, and then wind up giving it all back to the markets.

And this happens again and again and again.

Another ironic thing is that it really isn’t their fault because it is caused by their primal survival systems kicking in and over-riding their rational mind.  It’s a response triggered by a specific set of circumstances that are very common in trading, and once activated, this response tends to create a vicious cycle that is nearly impossible to break, at least without some help.

Here’s how it works.  We’ll use my friend Jerry as an example (of course Jerry isn’t his real name).

Prior to opening his account, Jerry hadn’t ever traded at all.  He’d just heard about it, but didn’t really know what it was about.  He quickly sought out the basics of how trading works and chose to try a few things he’d read about on different forums he’d found.

It didn’t take long and Jerry felt confident enough to open a live trading and began placing his first trades.  Afterall, how trading works is straightforward enough and he was pretty smart, certainly smart enough to get this.

During this time, he was trying earnestly to make money, but he was mostly hitting losers because this was all still very new to him.  When he hit his first decent winning trade, he was jazzed.  What a rush!  What a great surprise!

The next winner was even bigger and WOW this really rocks!

Jerry managed to run his account up by just over 20% and he was feeling invincible!  He’s got this trading thing down and he’s on his way!

It didn’t take long though until Jerry started getting reckless, jumping into trades that he had no business entering.  He felt helpless as his account balance went down to break even, then down by 10% from where he started, then down by 20%, then down by 30.  He couldn’t stop himself, even though he was well aware of what was happening.

Jerry put more funds into his account because he just knew that he could make this work, that he could repeat his nice run.

Unfortunately, Jerry was able to repeat the run, but not without repeating the rest of the cycle as well.

It finally got to the point where he just had to close his account and take a break.  He just couldn’t take it any more.  The most frustrating part of it is that intellectually he knew he could beat this, he just couldn’t seem to control himself once he started winning.

So Jerry called me up and asked for my help.

He wanted to understand why this happened and what he could do to fix it.

What Jerry didn’t understand is that what he’d been doing really was gambling.  He wasn’t trading, because he hadn’t taken the steps necessary to trade in a calculated and business-like manner.  What he had been doing was playing the game of anticipation and seeking the thrill of the unexpected.

Once a winner gets hit when you’re in this mindset, your brain chemistry is essentially the same as a drug addict and a gambling addict.  It kicks in and shuts down your rational mind while activating your pleasure centers in a big way.

The added danger of this and the reason that many people won’t make it in trading is because they’ve been caught in this experience, and they won’t be able to shake it until they quit gambling and truly treat their trading as a business – again in a very calculated and business-like manner.

If this story here sounds at all familiar to you, then I strongly urge you to check out the training in the Trading P.I.T. Club.  In it you’ll become that business-like trader that you need to be to stop gambling and start real trading.

Click here to find out more

Of course if you have questions, just let me know.

Cheers

Brian
“The Trading Turnaround Coach”

P.S.  Those that don’t attend to the problem described above are bound to only repeat the vicious cycle and unfortunately it can go on for years.  Don’t let it happen to you – stop gambling and get on with business-like trading that will help you keep your head clear and let you trade well rather than give it all back whenever you do make money.

Click here to find out more