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All our programmes are taught by senior professional traders that are experts in the subject matter with institutional experience and most importantly are passionate about teaching you how to trade the right way.

Our Trading Courses in are a combination of online classes & in-house class training which includes theoretical & practical application. There are flexible options for you, so no schedule is impossible to fit the education around. We will work with you to identify your goals and put a plan together to achieve them working around you.

 

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So you want to become a successful trader? Well, you are going to have to avoid making many common mistakes that traders often fall victim to. You’re GOING to make mistakes as you learn to trade, but the traders who actually start making money are the ones who LEARN from those mistakes and figure out how to stop committing them over and over. In this lesson, I am going to discuss the most common mistakes that traders make and give you some simple solutions to them. After that, it’s up to you to learn from them and make sure to avoid them as you continue to analyze and trade the markets.

Being in Too Many Trades at Once and Over-Trading

This is perhaps the most classic mistake that 100% of beginners make and about 90% of the rest make. Also, it’s no surprise that about 90% of traders lose money over the long-run when about 90% of them are trading too much. Another interesting tid-bit is that if you find you’re in more than one trade at a time, you’re probably trading too much. There really is no logical reason to be in more than one trade at a time, ever.

Most people simply cannot learn to ignore the temptation to constantly be in a trade, so they make up all sorts of reasons why they should trade or they make up trading signals that aren’t really there. The cold hard truth of it all is, unless you learn to control yourself and stop over-trading, you are never going to make consistent money trading the markets.

Perhaps the quickest and easiest way to train yourself to stop over-trading is simply to change the way you think about trading and what “making money trading” actually consists of. Once you start remembering that less is more and that you will literally MAKE MORE MONEY by TRADING LESS over time, you will begin to look for reasons why a potential trade might not work out, instead of trying to find any little reason possible to enter the market (like most traders do).

Spending Too Much Time Thinking about Trading and Looking at Charts

Similar to over-trading, is generally just thinking about trading too much. Traders often make the mistake of spending too much time flipping through the charts over and over, even when there are no obvious price action signals to trade. As a result, what ends up happening is that they enter a trade they wouldn’t normally take if they where following their trading plan.

If you find yourself at the point where you are thinking about the markets and trading / trades you’re in, nearly all the time, it’s safe to say you are also over-trading and losing money as a result.

You must build in planned time away from the charts, into your trading plan. Then if you are following your trading plan, those regularly scheduled times you’re away from the charts are just going to be “part of the plan”, “part of the process”. If you start deviating from the process and end up losing money as a result, you have only yourself to blame. So, in the end, it comes down to how good you are at staying disciplined and sticking to a plan, which is why most people lose money at trading; because they simply can’t stick to a plan and stay disciplined over a long period of time (consistently).

Trying to Make Trading Decisions From Short Time-Frame Charts

One of the biggest mistakes that new traders make, is day trading. Many people hear about “day trading” before they learn much else about it. This leads them down the wrong path right from the get-go, starting them on a cycle of trading off of short-time frames like the 5 minute or 1 minute charts for example, and this leads to severe over-trading and gambling as well as trading addiction.

Lower time frame charts are simply not as important as their higher time frame chart counterparts. The reason being is simple, the higher the time frame, the more data it reflects and so it carries more “weight” than a short time frame. A daily chart bar is far more important than a 1 minute chart bar, for example. You need more patience to trade higher time frames, but in return you are getting more reliable trading signals and less stress, a pretty good trade off if you ask me! When trading daily charts you can simply set up a trade and walk away for 24 hours or more; this is how one achieves trading like a nomad and enjoying the lifestyle that trading can bring.

Trading With Real Money Before You Have Tested Yourself on a Demo Account

This mistake is like a death-sentence for your money, yet time and time again, beginning traders do it. The mistake is, trading with real money before you have even tried your strategy on a demo account. What ends up happening is typically a number of things; traders aren’t familiar with the account and how it works, so they make silly mistakes like risk more than they thought they were or not enter a stop loss properly, etc. This causes them to lose money, of course.

Also, since you have not tested your trading strategy on a demo account (in live market conditions) you don’t even know if your strategy or your ability to trade it, are going to be effective. It seems insane that anyone would take their real, hard-earned money and just start risking it in the market with zero practice on demo, but hey, people go to Las Vegas and gamble all their money away, so it’s really just another form of that.

Your mission as someone who wants to become a skilled and profitable trader, is to TEST your strategy as well as your ability to trade it, on a reputable demo trading platform, BEFORE you try trading live! This will allow you to work out the ‘bugs’ with the platform that you may have and it also allows you to get a feel for the market and your trading method, without real money on the line.

Getting Sucked Into The ‘Black Hole’ of News Distractions

The “black hole’ of news distractions is a real thing in the trading world, and if you’re not careful you will fall into it and never get out until all your money is gone.

What happens is that traders end up “looking for reasons” why their trade should work out, and as we all know, you can find just about anything you want on the internet and you can find many opinions both for or against any argument or position you want to take, trading included. Another thing that happens is that traders go on the internet and start “researching” economic and trading news and start thinking they have “figured out” what will happen next based on XY or Z economic news release. Then, they place a trade based on that opinion, this is very dangerous. It’s dangerous because very often the trading news or economic news is ALREADY PRICED INTO THE MARKET, in other words, it’s already reflected in the price action and the “big boys” have already acted upon what they believe will happen, before the economic news comes out.

Then, when the news is finally released, a whipsaw will occur in the market, where price quickly spikes one way but then whipsaws back the other direction. This is obviously near impossible to trade and causes most uneducated traders to lose their money. This is the main reason why you should not trade solely on news.

Trading raw price action removes the confusion of trying to trade the news. As mentioned above, news and everything that affects a market is already reflected via the footprint on the chart; the price action. So, once you learn to read and trade the price action you are also learning to read and trade the news without having to actually analyze or read any of the news itself.

Not Understanding That Every Trade Has a Random Expectation

One huge thinking error that most traders have about trading is that they simply do not understand that every single trade they take has about an equal chance of ending up a loss or a win. Now, that is not to say you cannot have a high-percentage winning strategy, because you can. BUT, the thing about trading is that for any given series of trades there is going to be a random outcome of wins and losses, so that means you never know the sequence of wins and losses in a sample size of trades. However, if you expect that your strategy will win 60% of the time, then you can expect that percentage to manifest over a large enough sample size.

It’s the same thing when you flip a coin; you know that you will get heads 50% of the time and tails 50% of the time, but within that 50% expectation, you can have say 10 straight heads in a row, which could be confusing if you didn’t understand that you need to flip the coin a lot of times to get 50% heads.

Same thing with trading! You could get 10 losses in a row within say a 100 sample size of trades, but after those 100 trades you could still win 60% of the time. The implications of this are massive. If you don’t stay true to your trading plan and remain disciplined EVEN DURING THAT LOSING STREAK, you’re GOING TO freak out and probably over-trade and get so far off course that you end up blowing out your account!

Remember: ANY ONE trade means essentially nothing! It is the end result of a large series of trades that will show you whether or not your edge and your ability to trade is actually profitable. This also means you need to manage your risk to a level that allows you to get through a large enough sample size to see your edge play out!

Feeling a Sense of Desperation or Urgency to Trade

A huge thinking error that many traders commit is feeling a sense of “urgency” or “desperation” around their trading and to be in trades. This comes from putting all your “eggs” into one basket essentially, the trading basket. This is a huge mistake because trading is inherently risky and inherently difficult due to the fact that it requires such mental strength that many people simply don’t have or aren’t willing to develop.

Hence, you absolutely must realize and accept that trading cannot start off as your Plan A, so to speak. And, even if you get really good at trading and start making consistent profits month after month, you should absolutely still maintaning a side job or side hustle and make sure you do not put “all” your money at risk in the markets. You could even have a long-term investing / stock market strategy or put your money into something like a Roth IRA into Vanguard funds or something similar. Whatever you do, just do not put all your eggs into the trading basket because once you do that you are putting too much pressure on yourself for your trading to become profitable.

If there is one way to surely fail at trading, it’s putting too much pressure on yourself to make money at it. Trading success comes when you are calm, collected and literally do not care if your trades win or lose. That may sound silly, but I’m telling you that once you commit too much emotional and mental energy to any one trade or to your “trading” in general, you have already written signed your “death certificate” in the market.

Waffling Too Much, Not Trusting Your Decisions and Sticking to Them

When you enter a trade, you need to stick with it unless there is a monumental shift in the price action on the SAME time frame you entered the trade on. Please, re-read that last sentence at least 10 times, let it really sink in, because it’s uber-important to your trading career. You see, very, very often, traders spend time analyzing the market, finding a trade signal, setting it up, placing it, then they go back an hour later and start freaking out because the price moved against them a little bit and they are seeing that “negative” sign next to their open trade profit. I hate to tell you this if you don’t already know, but this is NORMAL. You’re GOING TO HAVE trades that go negative and you’re going to have losses, but if you freak out every time a trade goes against you, you will very quickly blow out your account.

This point goes back to the one above where I discussed the random outcome of any given trade. You simply cannot afford to give too much weight to any one trade because it’s stupid to do so when it’s the large series of trade outcomes that matters, not any singular trade! Hence, you must not waffle on every trade you take, you must let them play out and let the market do the ‘thinking’ so that you can trade stress-free and profitably!  In other words, GET OUT OF YOUR OWN WAY and let the process take over!

Focusing Too Much on The “money” and ‘reward’ and Not Enough on the Process

As I mentioned at the end of the last point, you have to get out of your own way and let the PROCESS TAKE OVER. Traders spend way too much time focused on money and rewards and a relatively tiny amount of time actually focusing on the things that matter; the strategy, trading it properly, sticking to it, managing risk, position sizing, setting and forgetting, etc. You do not need to think about ‘rewards’ and ‘profits’ because those things are ONLY a ‘symptom’ of correct trading process and correct thinking, they will not come forth just because you are thinking and worrying about them!

Meddling in Trades After They’re Live (set and forget!)

Do you want to screw up your trading and constantly shoot yourself in the foot in regards to your trades? Well, I have an easy way for you to do that! Simple start messing around with your trades after you enter them! I’m being sarcastic here of course, but seriously, one of the biggest mistakes traders make is meddling in their trades after they enter them.

I would say about 90% of the time, after you enter a trade, the most profitable course of action is to simply do nothing most of the time! Yet, most traders, especially beginners, do the complete opposite; they meddle with most of their trades, screw them up and lose money as a result!

You MUST figure out how to ignore the never-ending temptation to mess around with your trades after they’re live if you hope to have a chance at making consistent profits over the long-run in the markets.

Chasing a Signal You Missed – Entering Late at a Bad Price

It happens all the time; you saw a trade setup you liked, you didn’t’ enter it for any number of reasons, then you came back later to the charts and saw price took off in your favor, without you aboard. It can be maddening. But, the last thing you want to do is enter the market after it’s already taken off without you. You simply have to wait for the next opportunity and remember that the market will be there tomorrow. So, don’t be in a rush to trade or to enter a trade you missed, because this is emotional thinking that will only cause you to lose money.

Not Pre-defining Your Per-Trade Risk Allowance

Do you know what your per-trade risk allowance is? Is it an amount you could risk and sleep soundly at night with potentially losing? If not, then you have some adjusting to do.

Many traders don’t even sit down and work out what dollar amount they are comfortable with losing per trade, let alone make sure it’s an amount they are financially and emotionally OK with losing on any given trade. If you have not done this and you’re trading live, then you need to stop trading live until you have worked it out.

Conclusion

You’re going to make mistakes as you learn and trade the markets, especially when you’re first starting out. But, what separates the winners from the losers is learning from mistakes. Those traders who go on to make serious money from the markets are not the ones who never make any mistakes and trade “perfectly”, but the ones who learn to avoid the mistakes discussed in this lesson and learn from them. It’s very easy to commit the same trading mistakes over and over and over, until all your trading money is gone. Your goal is to not allow that to happen to you.

I can help you via my lessons here on this blog and even more in my professional trading courses and members area, but it’s always going to come down to YOU implementing what you’ve learned properly and consistently. I cannot come to your home and trade for you and I cannot call you everyday and remind you what to do and what not to do. But, you have the next best thing in that you have all my knowledge and experience injected into one comprehensive yet concise educational program in my courses. You also get my daily guidance in the markets via my members daily market commentary as well as my email support line. So, I’ve done everything I can to help get you on the right track with your trading, now you’ve got to decide if you’re willing to pony up the necessary discipline, dedication and passion to put it all together and make it work for you.

 

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One of the hardest truths about trading to implement, is that if you hope to become consistently profitable you’re going to have to think and act like you are, BEFORE you are.

Aspiring traders should follow and mimic the mental traits, attitude, belief systems and trading processes of those successful traders and investors that have walked before them. This seems obvious and sounds relatively easy perhaps, but there’s a reason why so few people actually achieve trading success. You need some insight and help with what you need to actually change and do, if you want to start making money in the markets..

The main reason most people fail at trading is that people generally don’t like to consistently do anything that is somewhat “boring” or “uncomfortable”. Even when it comes to such important things like health and fitness for example, most people know what they SHOULD do, but they knowingly don’t do it, even when they are aware of the consequences.

It is when these “consequences” seem “far off” or “a long time away” that we start to ease up on our dedication to the discipline required to succeed. So, you need to keep these consequences in your mind, so that you begin to place more value into doing what you need to do to achieve what you want.

So, what DO Millionaire Traders Value?

  • They value abundance and opportunity

Want to know the fastest way to lose all your money trading? Trade like you’re desperate. Or, if you want to lose your money REALLY fast, trade like you’re desperate and not even know you’re doing it!

What is “trading like you’re desperate”?

Trading like you’re desperate essentially means you are “desperate” to make as much money as you can as fast as you can, and this is what prevents most traders from actually ever making money, ironically. When you do things like trade when your edge isn’t there, or increase your position size beyond what you know you’re comfortable with losing or otherwise deviate from your trading plan, you are trading as if you’re “desperate” to make money. You will have to stop this if you want to think and trade like a millionaire.

Millionaires operate from a mindset of abundance. They don’t feel desperate to make money, and not just because they are millionaires. It’s because they see the endless opportunities in the market and elsewhere in business, so they don’t feel like they’re in a “rush” to take the next thing that comes along. Instead, they feel like they should wait patiently for the most obvious trade setup or perhaps the lower risk opportunity to come along.

Here is one of my favorite quotes that relates to not trading like you’re “desperate”:

I just wait until there is money lying in the corner, and all I have to do is go over there and pick it up. I do nothing in the meantime. Even people who lose money in the market say, “I just lost my money, now I have to do something to make it back.” No, you don’t. You should sit there until you find something. – Jim Rogers

I know it can be difficult and cliche sounding, but honestly, if you want to become a successful trader you’re doing to have to start trading as if you’re already a professional. The habits and mindset of a losing trader (desperate to make money) are NEVER going to translate into consistently making money in the markets. So, even if you have a $200 trading account, you have to trade it as if you are NOT desperate to grow it too fast or you WILL blow it out, quickly.

  • Millionaire traders value their performance in the market

One of the biggest distinctions between a successful trader and a losing trader, is that the former values performance whereas the latter primarily values money. When you value your actual trading performance in the market, you start focusing on all the right things and developing the proper trading habits that cause your performance to remain positive. When you value only money, you start to forget about all the things you need to do properly to improve your performance. Things like having a trading plan, being disciplined and not over-trading or risking too much per trade, holding your trades longerplacing your stops further away, etc. You value what you need to do to see your equity curve consistently go up.

You see, it’s impossible to value your trading performance and not also value the proper processes and habits that allow you to see your trading performance improve. But, when you start only valuing the money, you can easily forget that it’s not just about “making money”, it’s about SLOWLY making money over time. Because trying to make “fast money” always results in LOST MONEY.

Focus on performance, on the actual trading “game” and being good at it, not on the money.

The goal of a successful trader is to make the best trades. Money is secondary. – Alexander Elder

  • Millionaire traders value themselves and their abilities

Self-doubt does not help anything for the most part. Yet, time and time again traders will stare a perfectly good price action signal in the face and not take the trade, because they’re afraid, for one reason or another. They are doubting themselves and they are not confident in their ability to trade. Now, sometimes this is caused by just not really knowing what your trading edge actually is (which I can help you with in my professional trading courses), but often it’s just caused by overthinking.

One thing you’re going to have to begin doing right away is thinking and acting more confident in your trading abilities. Just like in life and in business, the confident players are typically the ones who come out on top, it’s the same in trading. I’m not saying you have to be some “outgoing prick” but you need to at least have solid confidence in yourself and your ability if you want to make money trading. Fear, insecurity and hesitation are not attractive qualities in relationships, business or trading; they do not attract people or money, so figure out how to drop them, quick.

This quote by famed trading educator Dr. Van K. Tharp discusses how to build confidence in your trading. First, you learn and study the markets, then you develop a refined trading strategy and then you practice it until you believe in it:

The top traders that I’ve worked with began their careers with an extensive study of the markets. They developed and refined models of how to trade. They mentally rehearsed what they wanted to do extensively until they had the belief that they would win. At this point, they had both the confidence and the commitment necessary to produce success. – Dr. Van K. Tharp

Side note: Being a “confident” trader does not mean you should be a “cocky” trader, and there’s a big difference. A cocky trader will take stupid risks, and too many of them. A confident trader will stick to his plan and execute his trading strategies when he sees his signal present, he doesn’t hesitate but he isn’t stupid and careless either. Hopefully, you see the difference.

I’ve written a multitude of lessons discussing trader psychology and behavior and how significant having the proper trading mindset is. Check out my article on the psychology of forex trading, to learn more.

How do Millionaire Traders Act?

Knowing how millionaire traders think about trading is only half of the equation, the other half is how they act in the market. As you may well know, it’s one thing to know something and an entirely other thing to put it into action and actually DO IT. So, I don’t want you to just read this lesson and think you “know it all”, I want you to actually put it into action in your trading.

  • Millionaire traders, trade less than you.

Anyone who’s followed me for any length of time has probably read one of my lessons on end of day trading and why you should do it and how powerful it is. But, let me just repeat it here: end-of-day trading is how most millionaire traders trade. How do I know this you ask? It’s easy. There simply aren’t enough high-probability trading opportunities in the market each day, week or month to allow most traders to day trade and become really successful at it. Furthermore, day-trading is often a catalyst for people to trade too much, risk too much and do everything else wrong. I really can’t say enough bad things about trading too frequently, if you don’t believe me, it’s only a matter of time before you find out through trial and error!

This quote by Jim Rogers is one of my all-time favorites on over-trading:

One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do. Most people – not that I’m better than most people – always have to be playing; they always have to be doing something. They make a big play and say, “Boy, am I smart, I just tripled my money.” Then they rush out and have to do something else with that money. They can’t just sit there and wait for something new to develop. – Jim Rogers

  • Millionaire traders control their risk, carefully

Controlling position size is really one of the overall keys to trading success. If your position size is in-check then it’s going to go a long ways to calming your mind down and putting you into the proper trading mindset. Also, managing / controlling your position size is one good example of HOW you trade from a mindset of abundance and opportunity, instead of desperation, as I discussed earlier. Keeping your position size at the dollar risk level you know you’re OK with possibly losing per trade, means you’re staying calm and you’re Ok with whatever the outcome and you’re not trying to make “fast money”; you aren’t desperate.

As the following quote from the trading great Paul Tudor Jones highlights, we should be more focused on protecting our capital than on “making money”, because when you focus on being a defensive trader, everything else tends to “fall into place”.

“I’m always thinking about losing money as opposed to making money. Don’t focus on making money, focus on protecting what you have” – Paul Tudor Jones

Conclusion

I want you to close your eyes and imagine that you’re already where you want to be with your trading. You’re making consistent money in the markets for a year, you have a plan you’ve followed to get here and you are comfortable with your risk per trade. You have no issues with losses because you know that as long as you stick to the plan, the wins will eventually make up for them and much more. Now, every time you sit down to look at the charts, before you turn on the computer, do this same exercise or similar. Every time.

Eventually, we do what we think about the most, whether those thoughts are positive or negative, hurtful or helpful to our goals. Hence, all of this, trading success, etc. starts in your head, as thoughts. I know it sounds cliche, but it’s true that “thoughts become things”, so be very careful what you are focusing on when you think about trading. Ask yourself, are you thinking about “dollar signs”, money and all the things you’ll buy with it? Or, are you thinking about your trading performance, about a consistently rising equity curve over time and about becoming a more calm and self-controlled human being? Start implementing positive trading habits and effective trading strategies. Fill your mind with positive yet realistic expectations about what is possible in the market and set sail on the journey of self-discovery and improvement that IS trading, and don’t ever look back.

George Soros: The man, the myth, the legend. If you haven’t heard of him and you’re a trader, you are missing out on a lot of very valuable insight and wisdom. In today’s lesson, we are going to discuss Mr. Soros, learn a little about why he is one of the greatest traders ever and most importantly, discover what he can teach us that will improve our own trading.

George Soros is famously known as “The Man Who Broke the Bank of England.” He earned this title in 1992, when he made more than a billion dollars shorting (selling) the pound sterling. He is the co-founder and manager of the Quantum Endowment Fund, an international hedge fund with more than $27 billion in assets under management.

Soros began his life under the toughest of conditions; living as a young Jewish boy in Nazi-occupied Hungary in 1944. He then immigrated to England to attend the London School of Economics and moved to the US in 1956 to work as a stock broker. Today, Soros is a passionate investor, philanthropist, and democratic idealist who could teach us a lot about investing, trading and philosophy.

So, what can we learn from this master trader that we can directly apply to our own trading? Let’s discuss…

Soros’s trading philosophy

George Soros is mainly a short-term speculator. He makes massive, highly-leveraged bets on the direction of the financial markets. His famous hedge fund is known for its global macro strategy, a philosophy centered around making massive, one-way bets on the movements of currency rates, commodity prices, stocks, bonds, derivatives and other assets based on macroeconomic analysis.

Whilst this is slightly different from my own personal trading approach which relies more heavily on technical analysis and more specifically, price action analysis, there are still many parallels between George Soros’s trading philosophy and mine…

What can we learn from George Soros?

It’s not whether you’re right or wrong that’s important, but how much money you make when you’re right, and how much you lose when you’re wrong.

This first quote from Mr. Soros really drives-home a point I made in my article on why winning percentage doesn’t matter. That point basically is that you can make money trading even if you don’t win the majority of your trades. How? Through proper risk reward. It really is as simple as that.

If you don’t know how to set your trades up so that you are making about 2 times your risk or more on your winners, you’re going to have a very, very hard time being profitable over the course of a year. I have discussed in multiple articles how you can make money trading even if you only win 40% of your trades, so, that means you’re losing 60% of the time! If you don’t understand this, then read my article on a case study of random entry and risk reward. But, basically what you need to understand it that as your reward per trade increases, the number of wins you need to be profitable decreases. The key lies in knowing how to pick the right trades and not over-trading, which is easier said than done, especially if you don’t have the right training.

Most of the time we are punished if we go against the trend. Only at inflection points are we rewarded.

This quote gels nicely with my overall technical analysis approach. I am primarily a trend-trader and I use price action to find high-probability entries into trades. But, trends end, and they ebb and flow and it’s at key chart levels or major inflection points that trends can reverse dramatically. So, I also look to trade from these major chart levels either by watching for clean price action signals or by getting in at the level on a blind entry.

The whole thrust of my approach is that the course of events is indeterminate.

In agreement with the teachings of the late-great Mark Douglas, Soros is saying in the above quote that we can never really know for sure what is going to happen in the market. We must trade in-line with this fact, otherwise we will get too emotional about our trades and we will start thinking that we have some special gift for predicting the market.

The truth is, by reading price action and knowing how to trade from it, you can develop an effective trading strategy that can get you very high-probability signals to both enter and exit the market. But, there are so many variables that affect a market’s price each day that there truly is an element of randomness to any given trade, that we cannot control. Thus, we must control what we can: our entry price, our risk, our stop loss and target placement and the money we are using to trade with, as well as our own behavior and thinking. Anything outside of these things is totally out of our hands in the market, and the more you try to control the market the more you will lose.

Being so critical, I am often considered a contrarian. But I am very cautious about going against the herd; I am liable to be trampled on… Most of the time I am a trend follower, but all the time I am aware that I am a member of the herd and I am on the lookout for inflection points.

This is similar to a previous point above, but the key point here is the word contrarian. I have always considered myself a contrarian and I’ve even written an article on the contrarian trading strategy. However, first and foremost, I am a chart-reader, so I always understand what the dominant trend is, as well as the overall story on the chart. As Soros, said, I am liable to get trampled on if I fight a strong trend. So, being contrarian doesn’t always mean trading against the trend, it means you think differently than the herd. I wait for pull backs within the trend, rather than entering when the trend is extended and about to pull back (as most traders do). Being contrarian to me, means I am following the price action and thinking like a professional, always trying to do the opposite of what the amateur is doing.

The market is a mathematical hypothesis. The best solutions to it are the elegant and the simple.

OK, anyone following me for any length of time knows that the above quote is my “jam”. The best solutions to just about anything in life are simple, trading included. I’ve written many articles on simplicity in trading, but if you haven’t read my Keep It Simple Stupid article, check it out first.

Therefore, I love price action so much and why I fell in love with it to begin with; it’s simple, yet effective. Tired of all the confusing trading indicators? Well, guess what? You don’t need them, AND they are hurting you. Don’t ask me how I know this, but let’s just say I’ve been at this for 16 years and the early days were filled with indicators and over-thinking, over-complicating and losing money.

Risk taking is painful. Either you are willing to bear the pain yourself or you try to pass it on to others. Anyone who is in a risk-taking business but cannot face the consequences is no good. There is nothing like danger to focus the mind, and I do need the excitement connected with taking risks to think clearly. It is an essential part of my thinking ability. Risk taking is, to me, an essential ingredient in thinking clearly.

I love this quote. To me, he is saying that if you don’t enjoy taking risks, specifically financial risks, you aren’t going to survive as a trader. Risk helps focus the mind he says, I am the same way; I feel like I am more keen and aware of the market when I have money at risk. But, there is a fine-line between being focused and being over-involved and over-trading. Risk can make you focused, but you don’t want to spend all your time watching the charts, this can lead to trading addiction.

The key point is, you must really love this ‘game’ to thrive at it. Some people just are not mentally cut out to take financial risks and be able to operate effectively in the market with their money on the line. That’s OK, this isn’t for everyone, but me personally? I love it. You probably do too, that’s why you’re reading this ;).

If investing is entertaining, if you’re having fun, you’re probably not making any money. Good investing is boring.

Trading how you should trade to make money is relatively routine and predicable. Meaning, there shouldn’t be huge ups and downs and changes in your trading routine. You should be going through a predictable plan of action each day as you analyze the charts and there shouldn’t be a huge variance in your trading behavior each day.

If you are over-trading and risking too much (gambling) you are experiencing high-highs and low-lows, emotionally speaking (and financially). This can be fun and even thrilling, but you’re going to end up broke. You don’t want to end up broke so try to make your trading as ‘boring’ as possible. By ‘boring’ it doesn’t have to actually be boring – it just must be non-emotionally-charged. Learn to love the ‘pain’ of routine and that routine will turn into profitable trading habits. Someone much wiser than me once said, “Suffer the pain of discipline or suffer the pain of regret”, let that permeate through your mind for a while.

Short term volatility is greatest at turning points and diminishes as a trend becomes established. By the time all the participants have adjusted, the rules of the game will change again.

What Soros is saying here is that volatility is greatest when investors without conviction cannot hold their position as the trend begins to change. The early adopters of a trend are the most knowledgeable and have the greatest time horizon, so they can hold through the normal ups and downs that occur in the markets. As the trend gets older, the latecomers (newbies), who are simply chasing the past performance (they FEEL good now that the trend seems cemented), have little conviction in the trend and can be easily shaken out when the original investors begin to take profits and move on. In short, the weaker hands in the market get scared at the slightest move against their position and most of these people naturally tend to enter when the trends are very old and concomitantly about to change course.

That high level of volatility is indeed a telltale sign of turning points (both up and down) in the markets. For a price action trader, volatility is our friend and if you know how to read it properly it can be very profitable.

I’m only rich because I know when I’m wrong…I basically have survived by recognizing my mistakes.

Finally, just like Soros, I too have survived this long in the market by recognizing my mistakes, admitting I was wrong and fixing the problem. It also means that I recognize when a trade I entered is not right and get out.

Trading is not for the person who cannot admit they are not perfect or when they’re wrong. You are going to be wrong a lot in trading, especially in your early / learning days, so get used to it, embrace it and LEARN FROM IT or pay the price.

Conclusion

George Soros made his initial fortune by taking a contrarian position; he bet that the British Pound would sell-off when it was high and seemed strong and most people were long. Soros was able to do this by being an astute student of the markets and charts. In my article on the false break trading strategy I even include a chart that shows there was an obvious bearish daily fakey sell signal in the GBPUSD the day before it collapsed. I’m willing to bet Soros saw that reversal signal as the ‘final straw’ for him to short. Either way, he was a contrarian at heart and therefore I feel such a strong connection with his approach.

When you learn to read and trade from the natural price action on the charts, you inevitably start thinking more like a contrarian and less like a herd-follower. You stop being afraid because the chart starts making more sense to you. Fear comes from lack of knowledge, from not understanding that which we are afraid of, and you certainly cannot be good at something if you fear it. You can eliminate your trading fear by gaining more knowledge and learning to trade price action. If there is one thing we can say to summarize George Soros’s trading success, it’s that he developed his trading abilities so acutely that he had no-fear of taking any trade, and we can see the pay-off of such an ability in his famous billion-dollar win shorting the British pound.

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Obviously, you’re into trading to make money, the dream is always to earn money and live the lifestyle of our choosing and enjoy the freedom trading brings. I know those are some of the things that lured me to trading in the beginning of my career.

Almost 100% of people coming into trading are drawn in by the desire to make money and improve their lifestyle. Whether you want to admit it or not, that is probably why you are on my blog; because you think you can make a lot of money trading or you think trading can bring you an amazing lifestyle change. Hey, there’s nothing wrong with those kinds of thoughts and feelings because they ARE obtainable goals if you study hard, perfect your craft and manage to keep your bankroll intact long enough to live to trade another day and come out the other side profitable.

I’m certainly not hear to squash the dreams and ambitions of newbie traders (I was once one myself), but what I am here to do is help you achieve those dreams, and in order to do that we first must put these life-changing dreams and goals to one side and look at what’s actually going to get us there, we need to get smart, we need to be real and cut through the noise. You will only make money as a trader if you’re in this game for the right reasons and for most traders, at least in the beginning, they are not trading for the right reasons…

Do you love the money or the process?

Let me ask you this; do you REALLY LOVE THE PROCESS of learning about markets, studying and looking at charts and trading in general? Do you TRULY enjoy it? Or, are you just sort of slugging along because you think you can make fast money? For most traders, especially beginning traders, the honest answer is the latter.

In trading, as with any business endeavor and life in general, if you aren’t IN LOVE with the process you are VERY RARELY (if ever) going to achieve the goal. Read that last sentence 5 times before you continue.

How can you make an honest assessment of whether you are in love with money or the process of trading?

Here are some signs that prove you’re trading for the wrong reasons

  • You’re trading money you can’t afford to lose. If you’re doing this, it’ because you’re too focused on the money. People who risk money they really cannot afford to lose are doing so because they want to make money fast and they are only thinking about the prize, not the possibility of losing that money. Bottomline, don’t trade with money you really cannot afford to lose.
  • You’re thinking only of money, not enough about trading or your trading plan or strategy. Trading really shouldn’t be all about ‘money’ to you. The money is just a way to keep score in a game that tests your ability to remain disciplined and patient in a world of constant temptation. If you are trading properly and focused on the process and excited about the process, you will make money and that money is like the score, if you’re score is going up, you’re winning, if it’s going down you are losing. Ironically, when you focus too much on the score (money) you end up losing.
  • You’re already making plans of what you’ll do after you make XYZ money in the market, you only think about the rewards and not the risks. Like the last point, but a bit more specific; I know a lot of amateur traders who get super excited about the possibilities of what they will do with the money they make from trading. It’s great to have ambitions and goals, don’t get me wrong, but this cannot consume your thoughts. If you’re making plans of how you will spend money you haven’t made, your trading mindset is not right yet.
  • You trade for no good reason, even late at night before bed, pressing some buttons for the gamblers endorphin release, you need to be in a trade. If you end up trading all the time, entering one as another one closes out, you don’t want to trade anymore, you NEED it. This is trading addiction and I can promise you that it will very quickly drain your bank account.
  • You get enthralled by the next biggest trading thing (Like crypto currencies, which by the way, I think bitcoin and the like is basically a Ponzi-scheme and I encourage people to stay away). Stick to major markets, major Forex pairs and major stock indices and commodities, don’t trade every market under the sun, this will cause you to over-analyze and over-trade and lose money.

The right reasons to trade:

  • You should trade because you love trading, plain and simple. You must love the process of trading, not only the dream of the end-goal, or you will never achieve the end-goal
  • You’re becoming methodical and well-structured in your approach, making plans and keeping notes and spreadsheets, you’re taking this seriously. Once you start doing things like this you know you’re on the right track. Being methodical and having a trading plan and keeping a trading journal in spreadsheets of your trades is something traders do who truly enjoy the process. These things keep you accountable and help develop proper trading habits and routines.
  • You live and breathe markets, it’s what you do, it’s who you are, every precious moment of free time you’re reading a post on a blog like the one you’re reading now or you’re reading a classic trading book like The Market Wizards or Trading in the Zone or perhaps studying chapters in my price action courses, you’re studying charts religiously, even if you’re out and about.
  • Your family and friends don’t understand you any more, the conversations have turned into things people can’t relate to, you feel alone, isolated, and feel desperate to find others who think the same way.
  • You love self-improvement. Trading, more than anything else, is about self-improvement. Show me a successful trader and I will show you a person successful in other areas of his or her life. Intense discipline, focus, passion, patience – these are the ingredients of LIFE success not just of trading success.
  • You are competitive, you like the competition. The idea of competing with millions of other traders and putting yourself into the that top 10% who are making all the money – drives you more than anything – it’s inside of you – it’s NOT JUST about getting a lot of money it’s about the self-confidence and the feeling of knowing you are better than all those other traders and you out-competed them. It puts you in a very small group of upper-echelon individuals and is a true accomplishment, one you’re dying to achieve.
  • You simply love markets, you love charts, you love business and entrepreneurship, you love studying what drives the world economies and you find yourself watching CNBC even when you’re bored or (god bless you) the PBS nightly Business news.

Conclusion

If you want to get fit and healthy and achieve your optimal body composition, you must fall in love with the process of working out and eating healthy, because if you don’t fall in love with it all, you will never continue to do the little things day in and day out that lead to the type of body you want. Same thing in trading. To get the money and the cars and houses and the life you want, the life that IS possible from trading, you have to love the process, the little things, the details, otherwise you’ll never stay committed to the discipline that is required. As they say, the devil is in the details.

To succeed at trading you must let go of the need to control the outcome. You must trust the process. You must trust your intuition. You must trust yourself. You must fall in love with the process if you want to get the results you’re looking for.

Don’t worry if you’re not yet feeling this quite yet or doing the things I discussed above, just stick with the plethora of inspirational and educative lessons on my blog and then study the chapters in my professional trading courses as well as follow along with the daily market analysis I post for members. You will soon find yourself enjoying your trading and hungrier for knowledge day by day, momentum builds momentum, and you must turn your desires into habits. Habits are what makes someone successful and when you start by developing the proper trading routine and stick to it, it will turn into a habit that leads you down the path to trading success.

For those who can’t yet make sense of it all and feel overwhelmed, the cliché saying holds true here; When the student is ready, the teacher appears; you just need to turn your desires into passion and to do that you need knowledge and consistent stimulation. At Learn to Trade the Market, we live and breathe trading… so we have you covered.