Monday, June 3nd, 2013 by Aaron Mckeel
After months of trading I reached the following conclusions and I would like to share some of the valuable information I discovered along the way with my binary options journey. Read carefully and these guidelines might save you a few dollars and if you are careful enough you can become successful and improve your rate of success. Many of these mistakes are common and can be easily avoided and I advice all of you beginners out there to read this carefully before you start trading.
* I have used price action 0% every since I began trading.
* Price Action is the most simplistic and most valuable tool in trading, and I will now be using PA to determine all of my trades.
* I have only waited for swing highs and lows.
* Although waiting for swing highs and lows can be rewarding, not only will I analyze for these setups but I will further my knowledge in trading many varieties of setups.
* I enter randomly in the market just because its at a support or resistance level.
* I will never again get into a trade “just” because it’s at a support or resistance level. I will use confluence and guidelines combining price action and analysis to determine if I will enter the trade regardless of if it’s reached a level.
* I only look at one minute charts.
* I will now be trading the higher time frame charts 90% of the time so I can be rid of market noise and confusion. The only time I will view the intra-day charts is to focus on particular trading setups clearly in the heat of the moment for a first person view.
* I was shot down trying to fight a breakdown.
* Never again will I fight a breakout. Simple as that.* I take trades too early because I think I wont get another chance.
* Even if you don’t get another chance. Being unsure can cost you. And the market will always be there tomorrow.
* My risk management hasn’t been good.
* I often let a trade go against me for too long thinking it will change direction. I will now use a more appropriate Risk to Reward ratio. And I will continue to use no less than a 1.5:1 ratio.
* I’ve taken profits too early; not equal to my target.
* Taking profits too early isn’t being profitable in the long run if the risk ratio is weighted more than your reward ratio.
Either you breakeven or you take the full reward.
* I’ve jumped in a few trades within a few seconds of opening a chart just because I feel the price is too “high” or “low”
* Regardless if price is high or low, I will never again open a chart and place a trade before analyzing.
* I don’t have a checklist for any of my strategies.
* For every strategy I follow, a checklist will be needed to ensure myself if I’m entering a high probability trade. Discipline is crucial, and knowing or following a checklist is needed.
* I feel I don’t even have a strategy because I am not currently profitable.
* To be profitable, I must master a variety of strategies.
* If a long amount of time passes by without me being in a trade I lose patience and make stupid trades.
* No matter if a week goes by, I refuse to enter a trade without cause. Discipline makes or breaks any trader.
* I never brainstorm previous price action I just look at current data.
* It is important to check previous data, because potential setups can be unseen if key Support and Resistance levels aren’t drawn out.
* I feel when price reaches a certain point I MUST be in the trade just because I feel it’s impossible to surpass.
* Without confluence of multiple factors there’s no way to tell when a trend will end or not. And even then its not 100% for sure.
* Regardless of price action and what the market is telling me I feel there’s no way I’m not taking the trade.
* I know your eager to make money, but what good is it constantly trying to catch up. How can you profit from that?
* I’ve never gone a day without placing a trade. Even if their wasn’t an opportunity.
* Got ketchup?
* I rely on pointless indicators.
*Some indicators can be useful if used effectively but 99% aren’t. Price action is key.
* I searched for trading robots. Robots wont help me when algorithims change.
* Listen to professionals, that’s why they are professionals and make a living doing this.
* I’ve never made a trade on the 1hr 4hr or daily chart.
* The higher time frame charts have little to no market noise, and show a good sense of where the market is going, were its struggling, and why its moving the way that it is.
* I feel the longer time frame charts will never give me opportunity.
* Opportunity on the longer time frames have much more clarity and trading the one minute and five minute charts only give off too many false signals.
* I have used about 10% logic in this 100% mental business.
* I will now put in 110% into understanding the markets now that I have a greater understanding of what my faults are.
* Sometimes I don’t want to listen to professionals because I’ve only looked for the easy way out.
* Wanting to be in the market NOW and make money NOW will only lead you backwards and actually take longer to be profitable.
* I have made stupid trades in attempt to earn my lost money back only to lose more.
* Emotional trading is the account destroyer. If you have lost a heart pounding trade. Remove yourself from the market immediately to refrain from placing a stupid trade that will only make matters worse. Do something soothing like playing the flute or Chelo.
* Most of the time I don’t look at the big picture.
* Looking at the big picture will help you find key levels in the markets and help you to determine your entry and exits. Use this to your advantage to find major market moving levels.
* I haven’t really studied beyond basics when it comes to strategy.
* I will now go more in depth with mastering one strategy at a time. The more you know about one in particular the faster you can move on to add another one to your arsenal.
* I have spent too much time waiting for maximum daily opportunity.
* I have made good profits in a single day, only to lose it all in the same day due to over trading. Once a comfortable point is reached, simply exit the markets for the day, and especially if an uncomfortable amount has been lost.
* I take too many shots in the dark.
* I will never enter any trade again that doesn’t resemble a high probability.
* Much of my trades were without confluence.
* This falls under being greedy and having a lack of self discipline. I will never take a shot in the dark again.
* I have mastered 0 strategies.
* Knowing a strategy like the back of your hand can determine the difference between a profitable trader and one that isn’t. I will now put my main focus on mastering one strategy at a time as well as keeping risk management in mind.
* I make the possible seem impossible.
* Using 10 indicators at once, studying 50 different charts intra-day, and having no guidelines will make even the best setups pass you by. Keep it simple, keep it clean.
* I only focus on short term Support and Resistance.
* Focusing on long term Support and Resistance helps find key levels and major swinging points. Use this to your advantage.
* I basically gave away money.* I plan on getting it back, and will get it back, it’s all about determination, strategy, and discipline.
* I have never held a trade longer than an hour.
* Holding positions for an extended period of time allows price to fight for favor, as well as increase your gains. Sometimes holding a position for a long time can maximize gains.
* I focus too much on what is going on now and not what has happened in the past.
* Past can help predict future.
* I don’t study the charts when the market is closed.
* Studying the charts during the close is the most important time to study the markets. This is the time were your brain can really sink in all the essential info and help you to become a better trader. Also your not constantly worrying about your trades.
* Even though I have been correct on about 50% of my trades, I haven’t been profitable due to lack of risk management, reward ratio and trade management.
* Risk management, Risk to Reward ratio, and trade management are the benefactors in being profitable. What good is it to have your risk ratio higher than your reward ratio?
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