To be a trader - 20 years'journey from novice to pro novice

[oilman5]

Pre and Post Trading Checklists
One of the most important things you can do to improve your trading is to develop specific patterns of behavior. If you have ever watched a professional golfer get ready to hit a shot or pro basketball player take a free throw, you will see they have a very defined ritual or pattern they follow each and every time.

Since your goal is to be successful on every trade, profitable every day, month and year, you will need to develop routines used by professionals to ensure maximum consistency and success.

Develop Pre Trading Checklists, a Daily Schedule and System Setup (including disaster plans) and Post Trading Day review checklists.

Also snap pictures of your charts at the time of your trades for both entries and exits. You can then review and annotate them with how and why you took the trade and the exit. This is an excellent learning tool that will significantly improve our trading.

Once we decided to get serious about trading we established these rituals and keep them religiously. We measure our success on how well we follow our system and our trading signals. You will need a programmed Excel spreadsheet for a trading logs to help you monitor your progress as well as some way to compare various trading approaches for profitability, win-loss ratios, draw-downs and stop loss comparisons.

Note: You can use our measuring tools or develop your own. We provide bonus spread sheets to assist you in developing your own expectancy ratio

Are You Having Trouble Pulling the Trigger?
If so, ask yourself: How Do You Handle Fear and Greed?

When you've conquered fear and greed, you can "pull the trigger" with confidence.

Four things about fear.
First, a definition. Fear is the unreasonable assumption that an outcome of any action will be negative. And greed is just the flip side of the same coin. It is fear of success, not failure!
You can overcome fear and greed by becoming familiar and confident with just the understanding of what is causing you this fear. Analyze all the issues and see how you feel before, during and after an event.
Fear can be overcome by understanding the basis of the fear, but better yet the lack of understanding is caused by your lack of confidence in your system. You get confused. That is easy to do because all trading programs, gurus, time frames, etc. will give you conflicting signals. Until your conscious mind and your subconscious mind agree on your approach, you will not trust the signals you see, and either hesitate, jump to soon, or freeze totally. This is caused by the uncertainty you feel.
No one can predict the future. You can only intelligently guess with some level of probability that a certain outcome will occur. Since trading the eMini is really trading the psychology of thousands of traders from around the world, it's important to understand that that psychology goes through fairly predictable patterns.
Patterns
Patterns such as Fibonacci retracements occur very often because of fear and greed. Smart people know that and fade those retracements, which is why the Pesavento Patterns we talk about work. After trading and reevaluating certain patterns, we have discovered two very high probability trades and we have developed the patience and discipline to trade them.
We compare trading signals from four different trading system approaches to show you how similar they are to one another. We prove that the key to any trading success is based more on mental control and money management than trading signals
you can literally walk by the computer, see whether to be long, short or out. Take a trade, if appropriate, and exit on the next signal with a 2.3 point average profit Finally, when you begin to get results with 70% win loss ratios on the real charts but are still not using your own money, it is time to go for it with real money on a small account. As you get more confidence, you can grow both your trade size and your accounts by using Dual time frame trading system

 

[oilman5]

………………………………
Best time for buy..or sell
first half hr of day opposite.. to gen market sentiment...as published in news paper...u can always..since u can view..how fool/ greedy can REACT....
and last hr..for swingstyle...BTST
but not applicable to novice...
…………………………………..
Price only...to trade....is the best form of trade...its formless trading
normally..few can follow ..with discipline...
price roc...crossing an price 10dayma ROC ..derivative is good...
however...aroon continuation..validity of strength helps...
………………………………………………….
Reason #1: Lack of a clear cut Trading Plan

Along with under-capitalization this probably ranks as the
#1 reason traders fail. Beginning (and some more experienced) traders will frequently be swayed by intraday news and price action.
They may have started the day with a clear plan for the day, but when the bell rings and the market starts they lose focus and become mesmerized by the next tick as the price action unfolds, alternately looking to buy or sell every couple of ticks/minutes and getting whipped all over the place.

A trading plan should give one criteria to measure trend against and determine a direction to trade. Once the direction has been decided the picture is significantly clearer as one side of the market has been taken out of consideration and one is free to focus on locating low risk opportunities to enter in the direction of the trend.

The plan should address such things as:
- Criteria for Trend determination
- Criteria for recognizing Entry opportunities
- Risk Management / Stop placement
- Trade Management (i.e. how to determine when a trade isn't working
- Profit objectives
- Exit strategies

 

[oilman5]

Reason #2: Overtrading - Trading round the clock
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The aforementioned lack of a trading plan coupled with Today’s lightning fast executions available through electronic trading as well as the extended opening hours for electronic trading get a number of traders in trouble.
When they see all the price movement and translate it into rupee terms it is very easy to become impatient waiting for good trading opportunities.
One may get caught up in the minute to minute fluctuations to the point where he loses sight of the overall picture and starts buying and selling every couple of minutes
(yes I do it occasionally & extremely exhausting) to grab a couple of ticks, just because the
trading software is so responsive and the fills so fast that he thinks he can get away with it.

We are so used to getting paid for our time in the real world (i.e by the hour) that it is difficult to sit in
front of the screen patiently waiting for a trading opportunity (that may or may not present itself for
another hour or two).
Seeing all this fluctuation the trader is tempted to "hurry up and make some money" and take a couple of quick trades to get paid for his time while waiting for the next trade that qualifies under his trading plan, however illogical that may sound.
Clearly, if the trader knew this type of trading to be profitable, based on his research, he should
incorporate it into his trading plan.
BUT The very fact that it is not part of the plan should eliminate such trades from consideration, as it is easy to get bored and impatient and hard to resist forcing things when the next trade is but a mouseclick .

NOW we will explore how certain limiting beliefs can affect your trading results and development as
a trader.
Limiting Belief #1: Belief in Mechanical Systems
(THE best system, best hardware,best software, best data etc).
__________________________________________________ ________

It never ceases to amaze us how people believe the process
of trading can be automated and all they have to do is
find a system that works - then they can kick back on the
beach with a pina colada in hand, call their trades in on
the cellphone and sit back to collect the cheques.
To these individuals life becomes a never-ending search for the "holy grail" of trading. They burn the midnight oil looking for the ultimate oscillator that will make them rich, sweating over the cleanest source of data, which type of data is better, continuous or back-adjusted,
looking for the best trading execution platform, the best charting software etc
In our observation these people are so wrapped up in the mechanics and intellectual exercise of trading that they never learn how markets actually work, i.e. that markets
are driven by fear and greed and emotional crowd behavior and that price behavior cannot be reduced to a mathematical algorithm.

These individuals might have been around the markets for a long time and claim several years experience, but in fact they've only had the same 1 year of experience several
times over, because they never learned from their experience and kept on making the same mistakes.

While there are a handful of commercially available
mechanical systems that have decent track records and show
profitability over time the reality is that those systems
are what we call -psychologically untradable'.

What we mean by that is that they frequently have large
drawdowns and those drawdowns may last for months. Most
people are not prepared to stick with such a system
through the drawdown and will usually abandon it near the
bottom of the equity curve before the system "gets back in
sync" with the market and moves to new equity highs
The thing most people miss when evaluating these systems
is that they underestimate how hard it is to stick with a
system through a drawdown period.

It is easy when looking at a track record, one will
"experience" the drawdown in a matter of minutes -
intellectually acknowledging that there is a significant drawdown, but then the system invariably pulls out of it and winds up being profitable for the year.

There is a world of difference between accepting a
drawdown on an intellectual level and then experiencing
that drawdown daily over a period of several weeks or even
months on an emotional level, wondering every day whether
this time the system has finally had it and may never pull
out of the "nosedive".

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Limiting Belief #2: Belief that Losses can be Avoided .
__________________________________________________ _______
Refusal to accept the fact that losses are an integral part of the game and a belief that they can be avoided leads to strange behaviors. This belief leads to
-paralysis by analysis' and problems pulling the trigger.

Trading is a game of probabilities. At any point in time there is an X % chance that a move will take place as anticipated, this means that conversely there is a (100%- X%) probability that it won't!
When implementing a trading strategy one should be cognizant of this fact and plan accordingly, i.e. not risk more than Y% of capital on any trading idea/opportunity,
as there is always a certain probability that one is wrong.

Regardless of how good your method is, even if it can be demonstrated to have 99% winners, you will still lose ALL your capital IF you risk it all on every single trade.(TNSN thread)

Another fact to keep in mind is that wins and losses are not evenly distributed and nicely packaged in a tidy series (for the previously mentioned 80% winning system
that would mean a series of 80 wins, 20loss, 8win-2loss etc.). Even a 90% winning system will occasionally have several losses in a row.
This brings us back to the differences between accepting/understanding things on an intellectual level
vs. an emotional level.

While traders may understand intellectually that losses are a part of the game, they still want the particular trade they are in at any given point in time to be a winner and are prepared to add to their position, move their stop as the market moves against them, or cancel it
altogether to help secure a positive outcome.
This behavior and belief leads to traders being forced to eventually take losses that are significantly bigger than allowed for in their trading plan.


LIMITING BELIEF #3: BELIEF THAT EVERY MOVE CAN BE PREDICTED / BELIEF IN MISSED OPPORTUNITIES
__________________________________________________ ________

Starting traders (and a number of experience ones
spend a lot of time fretting over missed opportunities.
They play the "would'a, could'a, should'a, wish I had'a" game, kicking themselves over missing opportunities they believe they could have taken advantage of.

Aside from being demoralizing and damaging to the psyche this practice is an unproductive waste of time.
Frequently traders will also introduce as a reason for taking a trade, information that wasn't known at the time the move took place.

The fact of the matter is that trading is a game of probabilities and at any given point in time a move may happen out of nowhere that was totally unforeseeable.

Some people have estimated that there are 10 no 50pt decent swings in NIFTYs in a week and that you are trading like a pro if you catch 3-4 of them.
In this respect trading is u may catch actual 5 move with 20 pt ie. Equivalent to 5x20=100 pt in week.

LIMITING BELIEF #4: BELIEF THAT MORE INFORMATION IS BETTER (ACTUALLY LEADS TO INFORMATION OVERLOAD / 'PARALYSIS BY ANALYSIS')
__________________________________________________ ________

Traders are inundated with confusing information and trading tips. It is everywhere, from the talking heads on CNBC, to the news headlines flashing across the trading screen to the online chatrooms, newsletters, hotlines etc.

How does one go about making sense of it all? The short answer is: You don't need to make sense of it all to make money from price fluctuations in the market!
All that is required is an understanding of crowd psychology and probabilities.
A number of traders believe they need to gather ALL the information AND understand it, because that's what we do in the real world when faced with a decision.
Once the information is mastered the secret to successful trading will somehow be magically revealed.
Nothing could be further from the truth! No matter how much information you accumulate and go through you will NEVER have ALL the pieces to the puzzle –
if you are waiting for that you will never make a trade.

What is needed therefore is to develop skills for decisionmaking under uncertainty, i.e.
a keen understanding of probabilities and the ability to assess
the risk involved and reward associated with different trade outcomes.

A losing trade does not mean the decision to enter it was wrong, it may have been, but it may also be a case of what is referred to in statistics as: "Good decision, bad outcome", i.e the odds favored a particular move, but the move failed to materialize as expected.
The best advice for beginning traders is: Forget all the conflicting information being disseminated out there. All that is needed is a price chart.
Leave it to someone else to worry about all the news etc.
The market's collective assessment of that information is reflected in the price action.
The fact of the matter is that everyone has the same set of information to trade off of when it comes to prices and the individual trader will never have the resources to secure better information faster than the large brokerage and proprietary trading houses.

All one needs to is to learn to recognize their "footprints" on the charts, as evidenced by chart patterns.

 

[oilman5]

Conclusion : to succeed as a trader you must be willing to accept the following facts
and observations:

- You must learn to understand how markets work and what drives them. Trusting your hard-earned capital to a mechanical system is a recipe for disaster as most traders do not possess the intestinal fortitude to stick with such systems through inevitable drawdown periods.
- You are never going to have all the information and will be forced to act on incomplete information
- Not every move can be predicted. There will be situations where your best laid plans are adversely
affected by random unforeseeable events. As a result losses are an unavoidable, integral part of trading.

Getting stopped out of a trade with a loss, contrary to popular belief, is a good thing (assuming you have a winning approach and solid trading plan) - It tells you that your trade is not working and conserves your capital for later use when another (hopefully better) trading opportunity presents itself.

Am I committing any of these errors in my trading?
- just answer to U.

 

[oilman5]

Misconception #1: Under-Capitalization and Unrealistic Expectations
__________________________________________________ ________

Some of the most damaging misconceptions and limiting
beliefs are planted in would-be-traders heads to entice
them to enter the industry, before they ever execute their
first trade.

The biggest one, by far, is that trading is easy and that
people can make obscene amounts of money within days of
starting out on the tiniest amount of trading capital.

While it is certainly true that the markets offer
unlimited potential and everyone has heard stories of
traders borrowing a couple of grand on a credit card to
get started, who subsequently went on to parlay that
into a small fortune.

The reality is that trading requires time, preparation
and sufficient start-up capital.

Starting out with too little capital and unrealistic
expectations sets would-be-traders up for failure
and is damaging in a number of ways, for example:

a) People who start on a shoestring are forced to take
on too much risk, and have a significantly greater
risk of ruin than better capitalized traders.

Someone starting out with $3,000 in the E-mini S&P?s
will have to risk $150 to $600 pr. trade, or 5-20% of
their equity on each individual trade. As a result
they will be ?wiped out? if they have a handful of
losing trades in a row.

Contrast this with someone trading the same approach
on a $10,000 account. Each loss will represent a
significantly smaller percentage of equity and they
will be able to weather the inevitable drawdowns that
occur from time to time.

Regardless of the approach employed, one should have
sufficient capital to be able to withstand at least
10 losing trades in a row and still continue trading.

The smaller the percentage of equity risked pr. trade,
the smaller the risk of ruin will be.

Research has shown that ideally one should not risk
more than 1%-4% of equity pr. trade.

b) Unrealistic expectations cause traders to discount
the progress they are making and lead them to ?force?
things to bring about the desired result.
As an example:

If you believe you 'should' be making $1,000 pr. day
pr. contract in the S&P?s when daytrading and find
that you are ?only? up $300-$500 by Wednesday after
trading for 3 days you will be unhappy with your
results.

Instead of continuing to do what got you to that point
in the first place and winding up with perhaps
$800-$1,000 for the week you will start pressing,
pushing for trades, trying to make things happen,
taking questionable trades and giving back in the
process what you?d made to that point and wind up
maybe -$1,000 or more in the hole for the week!

In trading, as in any profession, it takes time to gain
sufficient proficiency and one must learn to crawl before
they can walk.

By being adequately capitalized and budgeting several
months to a year at a minimum to learn the basics of
this profession beginning traders give themselves the
best chance of succeeding.

__________________________________________________ ________

Misconception #2: Confusing Margin Requirements with
Capital Requirements
__________________________________________________ _______

One frequently hears starting traders talk about the
minimum margin requirements set by the futures exchanges
as sufficient capital needed to trade a particular
contract.

Beginning traders will also look to the margin
requirements as a way to determine which market to
trade, saying things such as "My account is so small I
can only ?afford? to trade Soybeans and Wheat, because
they are the only contracts with a small enough margin
requirement".

The fact is you can?t ?afford? to trade ANY market unless you have a winning approach!

If you don?t, you might as well hand over your money to
the nearest charity and save yourself the aggravation,
because you will lose it anyway!

Margin requirements are set to protect the integrity of
the marketplace, they are intended to make sure that
traders have sufficient capital on hand to meet their
obligations should the market move against their position.

They are calculated based on a specific formula that
takes into account the volatility of the market in
question.

Generally speaking, as a rule of thumb, they are approximately equivalent to the average 3-day true
range of that market.

Margin requirements should NEVER be used to determine
the market, or number of contracts, to trade. Doing so leads one to risk too great a percentage of equity on any given position.
PROBLEM: A close cousin of un-realistic expectations is unwarranted over-confidence, inspired by a series of successes in trading.
This is something that frequently affects experienced traders after they have had a
good run in the markets.

They start feeling 'invincible', think they've got the 'market figured out' and
have a tendency to take greater risks than they should as a result (given their account size).

The market will invariably humble the over- confident trader and hand him devastating
losses, as he gets called on the excessive risk he has assumed through greater trading
size or the use of bigger stops (or even worse - the use of no stops).

 

[oilman5]

Trading tool...momentum
stock select...nse..scan by explorer...ready to move ..
pattern triangle ...continuation....i have bullish bias..
2nd one...at particular retrace...bullish engulf...
so this two condition...gives me candidate..ready to move up
..now @9-55...ready to enter.../max no 3 trade...
if any news +flash..enter aggressively...if published recommendation..
whether its a trap to book profit...[its normal]
trading amount 3 lakh..1each...
if after 15min price..1% up..enter...profit pt...3%....
always keep eye on nifty future...if sell order more...today is NOT YOUR DAY
.....this system has 70% success rate atleast for me..

i believe search of candidate..very imp...it takes me @2hr..after scan how it shall
behave next day...
various alternate scenario...entry / exit...

so now u all understand why it suit rm/dealer...they can unemotionally..
watch..ofcourse execute.. as confidently ...
if condition not suit to trade...they dont trade
……………………………………………………………………..
on short term trade...

its basically retracement buy...on a paticular stock..whether present value justified ? i use fundamental input...if analyst has conflict..i consider candidate is good one...

ma value 20 i use..also how stock behaved last 6month....
what ma x ..3/10 suggesting...i enter...
here i use good money management...trade amount 5 lakh...half idle

max put 50000, in a trade stop 4%...unfortunately accuracy..35-30% only..
so in a winning trade...i put 2lakh...after 5-8% price up..play for another..
4-5% profit...
i get out..from loser at stop...unfortunately ...recent switch down ward..
cost me good loss..as a part timer...gap down put me in puzzle...
result BIGGER LOSS
since..accuracy mine is poor..;.. i think to discard this...
as i am not master in volatility...present market condition...

……………………………….
fact is i am poor as short term trader...

why?...may be long days fundamental faith...
but worst one . holding loser..[use of hope]...
entry is definitely my strength...
but exit is poor...judgemental error comes from other commitment....
and its law of TRADE....ONLY WITH 100% COMMITMENT U HAVE CHANCE

TO TRADE RIGHT..
.................................................. ................................................
SO AGAIN I COMMENT ON DAY TRADE....
why i guess successfully...natural flair of 30yr of chess play..alternate situation to act, use of survival instinct.....

but its stressful, i am older now,...may be new guys r faster,
good candidate for next day is my strength....
metastock explorer i use...
also omnitrader..which suggest some candidates....

so i use pib, ...entry technique .. x of buy at break out on particular pivot...
if volume..is good...so i commit bigger...

i dont mind to lose, as loss r less in number..so it has +expectancy..
if market condition unpredictive simply i dont trade...

it helps to me...as noise trading i understand...so break of pivot , moving
to higher zone ...easier and suit me in past...
as i believe daytrade is gambling,..so luck of right or wrong is always there
so i am ready for wrong, it prevents me let loss run...
as screening is done..i know what i am expected to do..
filter..+ bias of nifty...
any news publish creates criticality of trade...sudden surge of greedy fool
can send stock price any where..., last 6month behavior thats why i study on hourly chart..on particular surgeday..

its readyness to act..basically given me lots of right trade consistently
...............
i give more hints..x of 7 ema with closing price..
trigger... 8day ..william%r std signal
5day rsi strength increasing...

i assure u it gives money...those who doubt can back test it..
atleast condition fulfilled , given +move within next 2days

psychologically i find it very useful, as i am ready to lose ..i am nothing to loss..[hey i bet on bangladesh,against india..pun intended..]
i can avoid my weakzone..volatility

………………………

Investment vs trading
...................................
this is a controversial topic...still i decide to touch..investing..is putting money
for long term..strategic thought process is imp...consider any managing director..plans for expansion of his company..money arrangement and plan to plough back.
..implementation of dream into reality..
constant watch to maintain target as per plan...is key...
Same thing , if u invest u have to check...

TRADING
.............
its a concept to buy low and sell high..
where the demand is EXPECTED TO build, buying candidate..
where further demand realisation is not possible ...SELL

SINCE expected materialisation is not possible[ on some cases]..
get out before other traders dump..

whichever path u look none is easy...
fortunately some torch bearer help in writing their journey in distinctive style

many a great name all of us can utter.., but its IMPOSSIBLE to follow them

why?..2 individual r not same...copying is not possible

can u be any of them?..no i assure u ..its an impossible event

CONDITION AND CONSTRAINT...CAN NOT BE REPEATED SAMEWAY..WITH SIMILAR VIEW AND LOGIC...

so what is your path and alternate view?

Amalgamate...

a basic std rate of return is possible...

money managers view is easy to implement...

investment view..PUT MONEY IN SUNRISE INDUSTRY. in india for indian company

Trading view.....based on some value analysis buy at oversold zone..and hope mean reversion shall bring u quick profit[ holding period 3-6month]

many traders may disagree...i say to them ..;'u r right, u do the same thing
in smaller timeframe..based on your superiority..so is ur RETURN'

NOW LOOK AT ALL GREAT DAY TRADER...they r mostly engineer..strong math logic...understand linear relationship..
with own developed one/ intraday plan ..with good signal generated..cont..
they can make money...regular basis...discipline and strict stop loss is mantra
experienced one with fund available...can do PLAY LEVERAGE

next..i say those who work in this field...they simply copy cat a winner ,

depending upon experience ..do a little, lose a little'

now..COMES THE FOOL, DREAMER...THEY NEVER UNDERSTAND HOW TOUGH ITS REALLY..[van tharp never made money by trading..though he trains many
best of the best traders]
so first..check..do have the ELEMENT IN YOU..time to invest and learn
right attitude....TORTOISE WINS HERE..

TRADING ON PRICE HAS 3ELEMENT...
NOISE...TREND…..SHOCK/EVENT
Noise..a price within +/- 3%[arbitary..as per my experience ]
its the time u should watch..
soon some big fund /syndicate starts buy or sell..with price change +/-change..defining an up or down trend accordingly...
its when more volume joins ..media writes..oppurtunity to make money for early entrants..when trend is no more moving up..[ put hope triangle pattern
shall show CONTINUATION]..ANOTHER RISKY ATTEMPT CAN BE MADE..
BUT WITH STRICT STOP...
hopelessly i dont know when profit book starts and price shall fall

many signal is used by many as per confidence level and experience..

but none can handle SHOCK/EVENT...
SINCE IT CHANGES INVESTORS SENTIMENT BY NEWCOMING OF BUY AND SELL ORDER...hence price study..aswell as order flow must be the tools in your trading arsenal

2nd aim is study what others trader shall do ..on an event...
CAN U CREATE MONEY MAKING OPPURTUNITY OUT OF IT?

3rd factor...global money flow to india...
if fii is selling, YOU HAVE TO..
nobody can withstand flood, ...sell and go to hill station...

 

[oilman5]

topic.. INDIAN STOCK MARKET
.................................................
1. FUNDAMENTAL
..........................
GROUP A AND SOME B1 ONLY...
LITERATURE..INDIAN INDUSTRY GROWTH 2002..2012
COMPANY ANALYSIS .. TOP DOWN AND BOTTOM UP APPROACH
SECTOR ANALYSIS
CAPITAL MARKET 500 COMPODIUM
LATEST RESULT..COMPARE QUARTERLY GROWTH
COMPANY .GOOD MANAGEMENT..ORDER POSITION
..................SUNRISE INDUSTRY..
GOVT FAVORISM..STORY FOR LONG RUN
MONOPOLISTIC VIEW

TECHNICAL
................
METASTOCK STUDY
INDICATOR STUDY
RESISTANCE SUPPORT .. PATTERN STUDY
GAP AND VOLUME SPIKE
TRADING MARKETS ...TOOLS
WHEN REVERSAL IS IMMINENT.. SIT ON CASH
MOMENTUM PLAY
DELIVERY IDEA
.....................
3.PSYCHOLOGICAL APPROACH

SUBJECTIVE BIAS..WHY MARKET WILL GO UP? WHEN IT WILL FALL?
FII FACTOR..GLOBAL FACTOR..OTHER WORLD STOCK EXCHANGE FACTOR
RESULT FACTOR... FEEL GOOD AND MEDIA HYPE
WHAT IS ACTUALLY STATE OF MARKET..WHAT TO BE IN NEAR FUTURE
4. TRADING
......................
DAY TRADE STYLE...SWING STYLE.. INTERMEDIATE TRADE STYLE

TRADE RULE 1 2 3

WHAT NOT
TO DO 1 2 3
HOW TO
TAKE ENTRY 1 2 3

PROFIT BOOKING
& STOP LOSS GUIDANCE 1 2 3

HOW TO ADD POSITION 1 2
CHECKING
RISK/ REWARD 1 2 3

DIARY
............
1. WRITE ANALYSIS OF ALL PAST TRADE
2. WHY PLANNING TO ENTER 'NEW' STOCK ...WRITTEN RULE
3. BEFORE BUY X CHECK ...DONT ALLOW TO BIG LOSS

..........................as i am novice in computer..
column name is given ..pl prepare suitable sheet..in excel .

trade sheet : create column
Heading
1 dt
2 name of stock
3 type of trade..buy/sell
4. trade set up condition..gap/ volume spike/support pt
result out/ commodity price up
5. entry condition ..pull back/ break out/ continuation
6. money alloted ..no of stock x price
7. style of trade ..day/ short term / inter mediate
8. present value of nifty
9. any hype at present...
10. stop loss
11. profit booking strategy ....1.................2
12. profit target.. p1............p2

13. additional buy strategy/ with reason
14. sell dt and NIFTY VALUE

15. sell quantity x sell price..
16. whether trade is profit...howmuch
17. whether trade is loss.. howmuch
18. have u followed stop and SAR. IF NOT WHY
19. reason of sell
20. cost of trade[ comission+ tax]
21. your net profit
22. your monthly rate of return..

2nd sheet ..monthly performance sheet
.................................................. ...

column description

1 month
2 total no of trade in month
3. no of winning trade
4. total amount of winning
5. no of lossing trade
6. total amount of losing
7. net profit/ loss in a month
8. is losing trade shown some pattern failure/
wrong assumption
9. av. win amount per trade per lakh
10. increase of your equity value..
11. percentage of wrong trade
12. risk amount in each trade. value ..in %
13. drawdown condition to quit
14. monthly yield compare to nifty yield in month

 

[oilman5]

A STORY TO READ
.........................

Whenever anyone comes to me for help in starting a trading career, one of the first things I recommend is organizing a business plan. It provides direction and helps novice traders start off with a systematic approach.

I suggest that new traders put their costs, their goals, and how they intend to achieve those goals, in writing. It's the same approach you'd follow for any other business. They usually come back with a reasonable plan.

Say, for instance, you have $10,000 a month in expenses. To earn that amount you would need to net around 50 cents a day, trading 1,000 shares. So you would start off learning an appropriate trading strategy and build up to that goal. It sounds simple enough, but the problem people quickly run into is that this isn't exactly like any other business, is it?

Trading Without Goals

We live in a very goal-oriented society. Aristotle once said, "Man is a goal-seeking animal. His life only has meaning if he is reaching out and striving for his goals." And I believe it's very important to have goals. They help keep us focused and motivated, giving us a sense of purpose and direction.

But trading is a funny occupation. Many of the same things that create success in other endeavors will cause problems in your trading. And so it is with goals. Trading goals can put you in a mindset that may very well act as a negative force on your trading.

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One of the problems with setting trading goals is that too often, the goal is all we can think of. Albert Einstein once said, "The American lives even more for his goals, for the future, than the European. Life for him is always becoming, never being." A lot of people look at this occupation in terms of making money and enjoying the freedom that trading affords, and they don't really have a love of trading for trading's sake. If you fail to enjoy the process of striving toward the goal, it will be difficult to reach that goal.

Another problem is that people always seem to set their trading goals too high. Your goal has to be reasonable for your skill level. Otherwise, you are setting yourself up for a lot of frustration. Trading goals automatically add pressure -- and the higher the goal, the more pressure there is. The more pressure there is, the more emotion you add to your trading. The more emotion you have, the more mistakes you will make.

There is an innate problem with setting up daily trading quotas as a goal. You can't force good trading setups. They either come to you or they don't. We are entirely dependent on what the market offers us. That means some days you will meet your goal, and some days you will not. It is hoped that the good days make up for the bad ones, but you have to come to terms with the inconsistency. If you try to force trades, you will invariably suffer an increase in stops
Slow and Steady

One thing that helps is making your hero the turtle instead of the hare. I see this time and time again in my trading room. Whenever anyone makes a big, impressive gain, that trader becomes the hero. Everyone tries to then emulate that trader's moves. Meanwhile, someone else who has been steadily racking up one small gain after another goes almost unnoticed, when in reality, the steady, small, consistent trades are adding up to a lot more than the occasional whopper.

Another thing that helps is breaking your goal up into steps. Rather than focusing on achieving that goal of 50 cents a day with 1,000 shares, start with 10 cents, then 20 cents, and build up gradually. Trade small shares to control your risk. Start with 100 shares, build up to 200, then 500, increasing shares only after you have achieved consistent profits. Take it one step at a time, and it might surprise you what you can achieve.

Last year, I took a backpacking trip into a wilderness area in Northern California. I am used to horse-packing, but I had offered to take my contractor on a nice bow-hunting excursion for record class mule deer, so I decided to act as guide and backpack in. I tried my best to keep my pack light, but the gear we needed that time of year during colder weather meant I had to haul 40 pounds.

Now I hadn't been backpacking in almost 40 years. So when I got out of the truck and looked up at the 3,000-foot peak we intended to climb, all I could say was, wow. Looking at our goal up there really put me in a state of despair. I kept looking up at the peak, then at my 40-pound pack, then over at the happy 45-year-old "kid" next to me.
put the pack on and started off. About 50 feet down the trail, my legs and back started hurting. I must have grunted or something because my friend asked, "Ken, you OK?"

I said, "Sure. I am fine." But what I was really thinking was, "What have I done? I am not going to make this!" It reminded me of what many new traders say to me after two weeks of trying to learn.

So I decided I wasn't going to look at the peak. I resolved to simply look at the trail and take one step at a time. The trip wound up being a "one step at a time" proposition. I was convinced I couldn't climb to the peak, but I could take one more step. And the funny thing is, I made it 12 miles! In fact, I could have kept going, but my friend was pooped out.

So take your eyes off the peak. If you want to reach your trading goals, learn to enjoy the process and simply take your trading one step at a time.
..........coursey nkp

 

[oilman5]

……………………………………………….
Only thing is as regards to implementation, proper education is also required as it is in the US. You can't go on learning by trial and error in a field that has a more than 90% failure rate. If there can be hotel management and textile designing courses, there should be proper trading courses.

Trading for the love of trading- everyone is not so lucky. Many ppl have to force themselves to do things they don't like to support their families.

No matter how excellent the analysis, it only reflects the current situation.It cannot guarantee what happens in the future-"The future is not always an extention of the present"-That is what TA reflects and that is why trading is a journey not a destination. You have to go where the mkt takes you and make continous adjustments.
Note…….. its best if u plot the equity curve

 

[oilman5]

TO BECOME A TRADER
following register/file u should open and write....this will definitely make u a trader.. sufficiently real earning potential..only patience reqd..
1.trading as a business
2.trading psychology
3.your psychology and you[real one]
4.your trading rule
5.different type of trade..swing..intermediate term ..day trade
[its not u have to do, but must know on what conditional fulfillment others r trading….enter and exit]
6.longterm trade or investment
7.indian stock
8. factors which move price
9.fundamental analysis
10.market study
11.ta..indicator analysis..
12.chart pattern
13.money management/risk analysis
14.trade preparation..volume study..trade management..
15. software..metastock[u may prefer other]
16.short sell
17.diary ..trade analysis..
..................yes i have this 17 register till with me since last 13yr of successful trading