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Why you Should not be Looking at Charts 24/7


Author: Shanda Biggs


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Trading is an interesting profession. I don’t think I know of any other skillset that requires so much mental focus and strength. Now being successful in any endeavor requires you to put in similar amounts of time and effort. But trading is different in a couple different ways. The most important being your mindset and psychology. 

The single most important thing that will determine your trading success is your psychology and your ability to manage your emotions. You will just not succeed unless you are able to numb yourself to what is happening in the markets.

I wrote this blog post to help you new traders or even seasoned traders see why it is not a great idea to be on your charts all waking hours of the day. It is important for your mind to take breaks. If you have your consistent focus on one thing 24/7 you are prone to burn out. Your mind needs breaks in order to bring clarity and order.

When you take breaks, you give your mind a mental break and this gives it room and space to open up for new ideas. Order flows into your mind when you release what you are focusing on just for a moment and bring your attention to something else. Its almost like you forget what you were working on and bring your focus elsewhere. Being in the present moment. This is powerful because it opens your mind up to new ideas.

Have you ever found that thinking so hard about something actually stifles your ability to think clearly at all? Take for instance trying to write a research report. When you think so hard about what you should write your mind comes up with no ideas. But when you are out for a walk not even thinking about the report you get a million great ideas to begin writing about! The same phenomenon can be applied to trading and mainly when you are analyzing charts which brings me to my main point of discussion for today.

Over Analysis

Over analyzing charts is one way to sabotage your trading success. Over analysis most commonly occurs when traders do their initial analysis but then they go back and “review” what they have seen on the charts. By looking at the charts over and over again they begin to see and imagine patterns and price action that is against what their initial analysis pointed to. They then develop doubt in their mind about what they initially saw on the charts.

I like to call this analysis paralysis. Maybe you have heard of this term. It is very real in the trading world and stumps a lot of traders. The trader gets so many conflicting ideas about what the chart is telling them that they literally cannot develop a bullish or bearish bias on the pair. 

How does this happen? It happens when a trader looks at a chart but does not exactly know what they are looking for. They don’t know how to dissect the chart and break it down into a story that the price action is telling them. Instead they look at various indicators, support and resistance and possibly trendlines or other technical tools and find that they all point in different directions. Indeed, this can be very confusing for a new trader and a seasoned trader!

What I have found to help me not over analyze the charts is having a crystal clear strategy so that I know exactly how I analyze charts and what types of setups I will be looking for. Then once I know exactly what I’m looking for I glance at a chart quickly to see if there is a possible setup. I don’t look at the chart for to long because this is when over analysis can kick in… when you stare at the chart for to long!

You may know what I’m talking about when I say your mind starts to develop patterns in the price action that you just didn’t see a few seconds ago! What I always like to say and implement into my trading is that if you look at a chart and do not see a possible trade within 30 seconds of looking at the chart then there probably is no setup.

Why? Because clear setups do not have to be dissected. They are so obvious that they just jump right out at you! Of course you must dig further to see if the setup meets all of your trading plans criteria but at the initial first glance you should be able to see if there is a valid trade on the chart.

I have implemented this strategy into my trading routine and found it to help immensely with over trading and emotional trading. I do not get emotional when trying to find a setup by making up possible price scenarios in my head.

By spending a little less time actually finding trades on the charts I am able to get back to the real reason I started trading in the first place. That is for freedom! I now have more time to analyze, backtest and review my strategy. Which are all vital components to trading success and growth.  Not being on the charts 24/7 allows you to cleanse your mind and come to the charts on the next trading session with a focused and clarified mindset. This is absolutely essential. So rather than analyzing possible setups 24/7 why not go out and enjoy some time with your family? Remember the reason you began trading in the first place! I guarantee you that by taking the time away from the charts between your trading sessions you will come to the charts when you are supposed to be trading with a clear and focused mindset!

At DARA trade we actually have a tool to help you NOT have to look at charts 24/7. When the perfect setups present themselves according to predetermined criteria you get an alert on that particular currency pair! DARA notifies you once your rules are met and ensures that you are only taking the highest quality setups! How awesome is that? If you want to see what DARA is all about click the button below to learn more and become a member. From here you can download our FREE software and begin your trading journey with DARA as your trusted sidekick.

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The Importance of Keeping a Trading Journal


Author: Shanda Biggs


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In todays post we are going to discuss the importance of keeping a trading journal. A trading journal is a critical component to your overall trading plan and future success.

In any endeavor that you have ever gone through, you cant expect to keep all the information in your head. Take going to university, you cannot expect to get good grades unless you retain the information you hear on a day to day basis. Inevitably you will write some things down, refer back to those notes and then learn from them. 

The same is true for trading. In order to consistently grow as a trader you must have something to measure your progress and keep you on track. This is what a trading journal does. It is a tool that allows you to document every single trade and action you take within your trading account. Such as setting take profits, stop losses and trailing stops. The more you measure, the more you can fine-tune your approach and become a better more consistent trader.

In saying this, there are 3 main things that keeping a trading journal can help you with and we are going to discuss them in greater detail below. But to outline them now, the 3 things are REVIEW – LEARN – GROW.

Every successful business keeps documentation of the work that they do. Progress reports are essential to a company’s growth. It gives the company something to measure their performance by and helps them to fine holes in their current strategy, make improvements and do better on the next project.

This is exactly how you should look at keeping a trading journal. It is essentially your report card. You can measure your success and then make improvements. The more in detail you measure your trades, the more in depth you can fine-tune your approach. 

With that beings said the first point we want to touch on is…

REVIEW

 By documenting all of the details of your trades you are able to do an in depth review of the trades that you take. Things to keep track of are

- entry date

- exit date

- entry price

- exit price

- trade management details

- slippage

- commission

- strategy

- profit/loss

- original target

- notes

Of course do not be limited to this list but these are just some ideas that can get you started on the right foot. By consistency reviewing your trades you are able to see where you may be falling short with your trades.

For example, if you keep track of your original take profit levels and where you actually exited the trade, you may find through careful review that you are closing out positions early that ended up going to your original take profit. This can be very powerful because by simply reviewing all of your trades you are then able to make these changes that can have a huge impact on your results.

Reviewing your trades is essential because by reviewing your trades you become more aware of what your best trading setups look like. When you know what your best setups look like you are able to execute the trades easily and effortlessly.

Other important details to include in your trading journal are screen shots of each trade and detailed notes on why you executed the trade, what the setup looked like at the time, why you managed the trade in the way that you did and why your take profit and stop loss levels were set in the way that they were. These notes are essential to fine tuning your approach. You may find after a large enough sample size that you are not great at executing a particular strategy. You can than make the decision to not trade the strategy entirely or fine-tune it in a way that suits your trading style.

LEARN

The only way to learn from your trades is by careful review. After reviewing all of your trades you are than able to pick out similarities and differences between great setups and not so great setups. By doing this you can tweak your approach and implement action steps to ensure that you do not make the same mistakes twice. When you see a mistake being made multiple times within you trading journal you can than write that mistake down to ensure that you do not make it again.

For example, “I find that pinbar candles in a down market that close as down candles to not make for great buy signals.” By making these observations in your trading journal you can greatly improve your consistency with executing the same great setups time and time again.

GROW

 By carefully reviewing and learning from all of your trades you are able to grow as a trader. Growth only happens by learning from previous experiences and this is exactly what keeping a trading journal allows you to do. You are able to sort through all of your previous trades in an efficient and effective manner. When you identify that you are making the same mistake within your trades you can then put a rule into your trading plan so that you do not make this mistake again. This is how we grow as traders, by careful and consistent review. Keeping a trading journal is an absolute must for all professional traders. This is why we have developed a cutting edge trading journal for those involved in our DARA trading program.

If you want to be a professional trader you must do what professional traders do. They all keep journals and this is why you must as well! We make it easy for you to review your trades, learn and grow as a trader! This is why we are giving away our amazing Journaling DARA software package for FREE. With this software you are able to review and analyze your trades in great detail. All you have to do is create a free account and download the software package.

 

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Why Discipline in Trading is SO Important


Author: Shanda Biggs


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I have learnt over the last number of years trading that there are a handful of things that make traders successful. I found a quote that I would like to share with you that outlines one of the most important, if not the most important thing that allows traders to sustain success in the markets.  

“Suffer the pain of discipline, or suffer the pain of regret”

This quote is simple and to the point. Practicing discipline on a daily basis is so important if you are a trader. It simply means that if you are not disciplined, you will not be a successful trader.

It is so important that we do not get caught up in the hussle and bussle of the market.  The market is a fast paced and exciting environment to be in. If you are not careful, the excitement can consume you to the point where you experience massive highs in your emotions while trading as well as lows. It is our job as traders to keep our emotional spectrum in check while being involved in the markets. We want the pendulum to be in complete balance. This allows us to look at the markets objectively and not through the lenses of our emotions.

Have you ever wondered what truly makes great traders successful? It has everything to do with the above quote. Great traders have incredible discipline. They have the discipline to take great trading setups but also to stay out of bad ones. 

They understand that sometimes the most profitable position is not being in a position at all. Yet they also know when to take action. They become masters and students of the game. 

Before you can be a disciplined trader you first need a vision. Why did you start trading in the first place? What drew you to the markets? Do you want to create freedom in your life? Develop and learn a new skill? Whatever the reason is. Be sure that you are clear. Nothing stops progress like a cloudy vision. When you have a vision and see where you are going and what you need to do to get there is when you take the action steps necessary to walk along the path. 

Create a vision for your trading and for your life and see where you are going and what you need to do to get there. Then you will take the necessary action steps to bring the goal closer to you.

How do you develop a clear plan to get to your trading goals?

One of the best goals I have set for myself and I recommend that you set as well is… making it a goal to follow the rules of your trading plan everyday. If you can do this one simple thing I guarantee you will see success in the markets. Creating the habit of following your trading plan increases your discipline.

One tool in particular that has helped many traders stay disciplined in the market is the use of algorithmic trading robots. These bots help keep the trader on track by only executing trades that are according to the trading plan.

Where many traders fall short is they do not have the discipline to follow their plans. Even a small deviation in the plan can be detrimental to a trader’s long-term success. Why?

Making small changes to your plan on the fly is trading based on your current emotions at the time. Someone who is disciplined would trade their plan no matter what. A trader making emotional decisions changes the plan from trade to trade and wonders why they are not improving.

Trading with robots helps you to not get caught in the heat of the market. It helps reduce emotional trading. You do not have to question your setup, you just execute because the bot tells you that there is a great setup available. Then overtime by following your plan, your edge presents itself.

Not following a set routine is why most traders are not improving. When you make changes to your trading plan on the fly you are not basing your decisions on concrete rules and data. If you have the data and back testing proof to backup your decisions, then you can make changes to your trading plan. But until then, stick with the rules you have set out for yourself. Only making real changes once you have the proof that the change will benefit you in the long run.

I have learned that keeping your trading plan concise and to the point is most beneficial. By having a focused trading plan you know exactly how to execute each and every position that you take. When your trading plan is focused, it is easier to be disciplined. You know what you are looking for and can execute accordingly.

A trader can have a HUGE advantage by using robots to aid in their trading. Many traders fail due to their poor psychology and mindset. If trading with the assistance of a robot could help you develop the discipline to be a successful trader than it would be a no brainer. That is exactly what robot trading will help you with. Being more disciplined! Allow trading with robots to help you follow your trading strategy!

At Evestin Forex we have developed some pretty great trading robots! We discuss each strategy that we trade in great detail in our FREE ebook. Click the here to download your FREE copy!

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The Differences between Automated Trading and Discretionary Trading


Author: Shanda Biggs


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In todays post we are going to explore a topic that many traders question. I to questioned this topic on my trading journey. I wondered which trading style would best suit me as an individual and which would be the best for my growth as a trader. What we are going to be discussing today is discretionary trading vs. automated trading. There are similarities and differences between the two styles and we are going to introduce you to both in this post.

What is Discretionary Trading?

Discretionary trading is laying out a trading plan that must be executed manually by the trader. Each trade requires the trader to decide if the setup adheres to their trading plan. If it does then the trader executes the trade. If it does not than there is no trade.

Some discretionary traders are more lenient in their trading plan while others are rigid. What does this mean? To be lenient in your trading means you may take some trades based on “gut feeling” or a “sense” that the market may move one way or another. When the trader feels these feelings they may chose to execute a trader or stay out of a trade. This skill takes years and years of development and only a handful of traders can use their intuition successfully.       

To be rigid in your trading plan means that you have a strict set of criteria and rules that quality potential setups. You then wait for ALL of these criteria to happen and than you execute a trade. As a discretionary trader with a rigid trading plan, you still execute all of your trades manually. Where the risk with this method lies, is that you may not be at the computer screen all the time in order to catch every setup.

What is Automated Trading?

Now that you are familiar with discretionary trading we are going to introduce you to another type of trading that you may or may not have heard about. It is automated trading. Many of you may thing that automated trading or algorithmic trading is only for institutions or big banks. This is not the case. There are many retail traders who have developed automated strategies and trading them successfully.

Automated trading is the process of coming up with a strategy that abides by a strict set of rules. Each rule must be adhered to before the trade is taken. Once each rule is adhered to the Expert Advisor executes your trade without you having to be at your computer screen. It really is as simple as that. Rather than sitting at your computer all day, you predefine your entry, exit and management criteria and the computer will execute your trades.

So How is Each Method Similar?

Discretionary trading and automated trading are actually very similar. They both require a set of rules to be followed in order to be successful. Automated traders know this set of rules must be well defined. Discretionary trades are able to be more lenient with their approach, which can leave room for gaps in their trading plan. They may not have defined the way to manage a trade and therefore when they execute a trade, it could result in unexpected losses. Trading automated systems means that you have already tested and defined exactly what your setup is. This means you execute every trade with no doubt in your mind.

A professional trading system leaves no room for interpretation. Every detail about how the trade is executed is well defined. Your system is the set of rules that will guide your trading. Both discretionary traders and automated traders MUST have systems. This is the only way to succeed in the market.

How is each Method Different?

Although each method of trading has similarities, they also have differences. The main difference is that as a discretionary trader, it is easier to deviate from your trading plan.

After all, you are the one in control. You are making the decisions. This means that there can be room for interpretation with your system and how you define a good setup at different points in time. Some people thrive in this environment while others do not.

To be a successful trader you must have your trading system very well defined. You need to know your action steps when different events happen in the market. Although, successful trading is not all about having the perfect put together plan. It is also about execution. How well are you able to execute the plan? The execution of the system is where I believe the problem lies for most traders and is another major difference between automated and discretionary trading.

A system can be beautifully defined but if it is not executed properly, it will not make money. Your trading plan is nothing without proper execution. Not being able to execute your plan the same way with every trading opportunity is when gaps in your trading plan start to develop.

How can you move forward?

Now that you understand the similarities and differences between automated and discretionary trading you can make an educated decision on which will best suit you and your lifestyle. There are traders who succeed at both types of trading.

But lets jump back to the main point that was reiterated multiple times in this article.

“Successful traders have well defined systems”

They execute these systems flawlessly and this is what allows them to have an edge in the market overtime. For you to develop your edge in the market it is critical that you are trading time tested strategies that are proven to work.

DARA – One Step Forward

For you to take the step to trade systems that are proven to work, requires you to find a mentor or great trader who has developed a strategy that works. You can then follow exactly what they are doing. This drastically improves your learning curve.

Let me now introduce you to our newest trading assistant who we believe will help you on your transition to automated trading.

DARA is a robot trading assistant that allows you to trade automated rules based systems while applying your own trading discretion. The great thing about DARA is that you are able to get alerted of great trading setups and than you can open the charts and decide for yourself if the trade meets your own additional criteria.

How does this help you? DARA is programmed to only find the highest quality setups. This helps you to see exactly what great trades look like. When you are patient to only take great trades, you will have an edge in the market. Successful traders have developed an eye for their ideal setup and that is what DARA will assist you with. Training your eye to only take quality trading setups. To start your trailing our DARA robot click the button below.

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