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Tag Archives: trading basics

Ten Reasons Traders Lose Discipline

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reasons traders lose discipline
Here is a list of the top ten reasons for losing discipline while trading. This list was sent to me by a risk manager back when I was a trader on the floor of a proprietary trading firm. This manager would routinely send out quick trading lessons and reminders via email. I have kept most of those insights and refer to them regularly. I later found out this list came from Brett Steenbarger, a trader…

This Risk Management Mistake Ruins Traders – Risk Spikes

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risk management mistakes
There are a number of risk management mistakes that traders make, but a personal “risk spike” is one of the hardest to control. It can happen any time, to new or experienced traders, can undo years worth of work in an instant and strikes when the trader is most vulnerable. The term “risk spike” has nothing to do with volatility spikes or sharp movements in the markets. This risk management mistake is personal, and involves…

Elliott Wave Basics: Trading Impulsive and Corrective Waves

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day trading impulse and corrective waves
Impulsive and Corrective waves are terms used to describe the bigger trending waves and the smaller pullback waves that occur within a price trend. Impulsive and corrective waves occur in all markets, on all time frames, and create the price structure we see on our charts. They help us establish the trend direction, spot reversals, and can be used on a micro scale to see when the trend may be tiring out (prior to reversal)…

How Day Traders (or anyone) Can Increase Wealth

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how day traders increase wealth
You don’t need a big day trading income to start increasing your wealth. Whether you have a big income or a small one, start building wealth by taking a few steps in the right direction. These steps include building consistency (in trading or your other incomes), investing, and creating additional income streams. Improve Trading Consistency to Increase Wealth Strive for consistency in your income. If you have a good idea of what you will make…

Basic Trading Terms Everyone Should Know

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When entering the world of trading there are certain terms and definitions you need to be aware of. Knowing these terms makes it much easier to do research, ask questions, and get help since most experienced traders use these terms without even thinking about it. If you want to trade, familiarize yourself with the following trading terms. Long/Long Position Definition If a trader is long in an asset it means that trader has bought shares…

How to Determine Proper Position Size When Trading – Any Trade, Any Market

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eurusd position size
A crucial element of trading success is taking the proper position size on each trade. Position size is how many shares you take on a stock trade, how many contracts you take on a futures trade, or how many lots you trade in the forex market. Position size is not randomly chosen, nor based on how convinced you are a trade will work out. Rather, position size is determined by a simple mathematical formula which…

Why Most Traders Lose Money and Why the Market Requires It

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bitcoin price over time
Learn why most traders lose money, and why that will always be the case. It’s a systematic requirement of the market. While individuals can break from the herd and make above-average returns, the vast majority of people will continue to buy and sell at the wrong times. Learn from the mistakes of the herd, so you can step into the small group of consistently successful traders.  This article is broken down in sections: How trends…

What’s the Day Trading Success Rate? The Thorough Answer

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day trading success rate
Considering day trading, and wondering what the day trading success rate is? Here’s the thorough answer. Not general or contrived statistics, but rather the success (and failure) rates I witnessed while working at day trading firms from 2005 to 2010. I’ve also conversed with several other trading firm owners/managers on their success rates between 2005 and 2015. Numbers varied slightly but were in line with the day trading success rates I discuss below. In total,…