Tuesday, April 23, 2013


I hear traders all the time, quietly, explain how they are struggling to break even.  Its a quiet suffering, no one gets on Stock Twitts and shouts I can not stay consistently profitable. Most make one trade and kill it followed by a series of trades that nullifies all the good work.  Before you know it,  your back at scratch or down.  Its humiliating.  I have been there- many times.   

This kind of trading can do awful things to a person, from frustration, to depression to low self esteem.  It can be so frustrating to lose one day when the previous day money seemed to be falling into your lap.  Or perhaps you first two trades were winners that had you feeling on top of the world followed by 3 trades that wiped it all out in the afternoon. 

If your like many of us, you have kids to take care of and wifes/husbands to keep happy and retirements to be concerned with.  It all adds up to alot of pressure.  Throw in the guys we see in stock twits and twitter who seem to nail every move.  Its pretty easy to feel like you do not measure up pretty quickly.  I have been there and I can personally tell you it feels like shit.   It so felt like shit that I swore that never again would I trade if I could not trade consistently   

These are the steps I followed strictly   and they took me from a looser to a winner:  
(this assumes your trading plan actually has an edge( MAKE SURE YOU HAVE AN EDGE) 
1)  I wrote a trading plan before market specifying where I would take a trade and exactly how i would scale it.  I had the exact number of contracts i would trade and exactly how i would scale them.  Pretty much no thinking.  

2) I would not enter a trade after 11am central.  Period.  

Most days I would get 2 trades,  sometimes 3.     So lets say I had a 10 k account.  I started with 1 contract and I scaled for 8 ticks each time.  There were some losers but the gross majority were winners. (see my daily postings & blog the trade is very spacific and its win rate is close to 90%).  Lets assume 8 winners a week and 2 losers on 1 contract using a 1 to 1 risk reward scenario.  Thats a total profit of $600 a week.  At the end of the month its $2400. Its a real big return and there are many weeks where the trade hits 100%- no losers. Again,  I post the work and send out the rules ahead of time, so one can watch and see that what I say is accurate. 

When I had my 2-3 trades,  I was done for the day.  Period.  

The next step in making this work was critical.  I DID NOT LOOK TO SEE HOW MANY WOULDA COULD SHOULDA POINTS I COULD HAVE HAD.  That is the killer in this bis.  Everyone always says I should have left the trailer or I knew it would make a huge move.  DOESNT MATTER.  All that matters is that you make you account grow.  You dont need a million trades, you just need ONE TRADE that will let you consistently grow your equity.  If you dont, you will be out of the bis.   

At the risk of sounding like i know it all,  I have sat in a dark quiet room after spending time loosing ungodly sums of money and wondering how it got this way.  How could I see so many good trades and still end up losing money at the end of the day.  So I gave up and admitted that all I had was one trade, and so should you- if you even have that.  

Work that one trade till its a bloody pulp.  Hit it again and again and grow your equity to a sizable amount, increase your trading size as you move along and increase your profits   If you want to know the secret, its the secret.   We are not all George Soros, or  Cohen or FT71's  or any other awsome trader out there.  

Most of us are every day guys with a dream.  The dream is to have the financial freedom trading can bring.  But the dream gets distracted and diluted.  We want to do everything great- and for most of us its a pipe dream.  So instead my suggestion to you is to do ONE thing GREAT.   That one thing can make you more money than you ever dreamed of.  Once you make your tons of money and you wan to see if you can pick up more trades-- go for it.    But first show yourself, your family and your sense of self worth that you can do this job on the most basic level.  You have one trade, you exploit it to your advantage and you dont look back.

You will feel like your on top of the world if you can do that.  Its late,  i hope this made some sense. 

PS -- this will not work if you don't actually have an EDGE-- critical.   


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