“It still amazes me just how many people in the markets still think that there is some indicator or system out in the vast plethora of trading methodologies that is better or more effective than the rest of the tools available to us already. The toughest part of the trading journey is coming round to realizing that the only working part which can truly make a difference in attaining speculative success or failure is really the result of the individual traders’ pre-defined rules.” – Sam Evans

Hello:

According to John Carter, there are a lot of great trading tips out there like, ‘Let your profits run and cut your losses short.’ And they’re all true. The problem is, a trader immediately forgets them all if they dive into a trade with the mindset of ‘I’m going to make a thousand dollars on this trade.’ None of that matters if a trader is in that mindset. You can have all the right quotes taped to your computer, but they won’t help. The funny thing is, if a trader is focused on their setup and then executing that setup according to their plan to the best of their ability, everything else falls into place. The key is to not get too wrapped up in the current trade you’re in. That’s a very common mistake because it makes that trade seem like the most important trade in the world. Instinctively, we all know that not every trade is going to be a winner, but traders often think that the current trade they’re in is going to be, in fact, a winner. That’s what caused the … mistake.

Below is the summary of some of my trading activities this week.

AUDUSD

Primary Trend: Bearish

This week, the market was trying to edge higher, whereas the overall trend is still bearish. This significant rally may cause swing traders to sell higher. I don’t have a new position on this pair.

NZDUSD

Primary trend: Bearish

The price movement on this pair is quite similar to that of the AUDUSD. The smart choice is to find a good shorting opportunity. But one has to wait till one’s entry rules are met. Discipline is the key to long-term speculative business.

EURCAD

Primary trend: Bullish

This cross has been ranging for most of this week. I may need to buy a pullback of the price, especially if the support at 1.4000 holds. Otherwise there may be a need to sell a downside breakout below that level.

EURAUD

Primary trend: Bullish

This cross also has been ranging for most part of this week. The next scenario would certainly be either a breakout to the upside or to the downside. Speculators should take the advantage of the next powerful move without losing their head. A market speculator loses their shirt because they first lose their head.

EURNZD

Primary trend: Bullish

The price is ranging around the SMA 50 and above the SMA 200. The ADX 20 is at the level 20, showing a very quite market. There’s no conspicuous gap between the -DI and +DI, but the price may move higher. I’ve no new trade on this instrument.

AUDJPY

Primary trend: Bearish

The southbound bias still holds as far as this cross is concerned. The rally that’s now getting weaker has already moved up by about 400 pips. One may need to sell short at 81.00, but shouldn’t forget risk control. Risk control measures must be learned before you speculate with your mom’s retirement fund.

Conclusion: In spite of trading being highly competitive, traders mustn’t forget to enjoy their profession. It’s easy to be distracted by profit and loss expectation, to get consumed with the process of trying to beat the markets, to become peevish and fretful about overall trading results, and forget about the benefits, the immense advantages that can be enjoyed as a pro. We should always be thankful for small mercies.

I’d like to conclude this article with one more helpful quote from William Thompson:

1. “We’ve all seen many traders come and go – and yes, as everyone knows 80% – 90% of traders are in fact losers. If the MACD crosses up, Stochastic rises above 81.54, the lunar bands widens to the point it intersects with the polar ice caps – then go long with a 2-pip stop. Or maybe I got that Stochastic parameter wrong, was it 81.53? This may be amusing but often it describes how many traders think.”

2. “Too many traders lever up so much that it’s almost a guarantee they’ll eventually blow their account. Show me a trader that says I make 20% – 40% per month or leverages 100% of their account consistently and I’ll show you most likely a losing trader.”

Your questions and opinions are highly welcome.

Thank you.

With best regards,

Azeez Mustapha

Forex Signals Strategist, Funds Manager &Coach

©2011 FX Instructor Forex Blog - For Traders, By Traders. All Rights Reserved.

.