Mindset Of The Millionaire Traders The worlds top traders may all have different methods for making

money but they all tend to share the same personality traits that make them great traders. To be a successful trader you must approach the markets with the right attitude. Here, I have isolated ten key traits that the worlds top traders have if you are going to achieve longer-term success. Ten Personality Traits To Make You Successful! You Are Responsible You are in charge of your own destiny and responsible for your own actions. No one else can be blamed. In todays society this seems to be an alien trait to many people. There is always someone to blame. The fact is, if you want to trade successfully, you need to take actions and understand that you, alone, are responsible - no one else. Traders who lose are quick to blame the friend they got the tip from, the newspaper they read the story in, or their broker. Its everyones fault but their own. When you place a trade you need to evaluate it yourself and understand that you are responsible for its prot or loss. This leads on to understanding the environment you are operating in and are happy to accept the loss or prot as your own. Education Many traders take tips from friends brokers and newspapers without knowing how and why the markets really work; they are of course doomed to fail. You would not try and drive a car without having lessons and the same applies to trading. You need to study and learn about trading before you start to trade. This may sound obvious but the bulk of traders dont bother to learn the basics. You need to spend time reading about all the aspects from psychology to different approaches and methods. Once you have learned about the environment you are working in you need to derive a method you are comfortable with. Develop Your Own Method The method you develop should be one that is compatible with your personality and what you have learned. The approach you adopt must be comfortable for you. Randy Mackay, one of the worlds top traders asserted: Virtually every successful trader I know ultimately ended up with a trading style suited to their personality. This is one of the reasons many traders who purchase systems off the shelf dont make money, even if the system is a good one. While the odds of nding a good system are small, the odds of getting a system that ts your personality are smaller still. If you cant stand to give back prot then a longer term trading system will not suit your personality, even though it may be protable over time. You have lots of different methods you can trade: Long term, short term, breakouts, reversals, the list is endless. You need to decide which one you are comfortable with, and which one you fully understand the logic of, and which one you are condent will work for you. Condence All successful traders have condence that they will succeed longer termin their aim to make money. This is a universal characteristic amongst the top traders and stems from the points we have just covered. Dr Van Tharpe a psychologist who has studied the worlds top traders and the personality traits that make them successful, concluded that winning traders believe they have won the game before they start Discipline Discipline stems from condence. It is the one trait that every top trader when interviewed refers to and its importance cannot be over estimated. There are two reasons why discipline is so critical: 1. First, it will help you maintain proper risk control, and allow to execute trades in accordance with your method during a losing streak that all systems suffer.

2. Second, it stops you from second guessing your system. If you do this you will almost always get it wrong.Why? Because you will tend to pick the comfortable trades, and these are not the ones that are likely to make money longer term. Bill Eckhardt a trader who helped train the world famous turtle traders once said what feels good is often the wrong thing to do and this is very true in trading. Its difcult to take trades when your friends, newspapers and your broker tell you otherwise. But successful traders dont believe in running with the herd and feeling comfortable. They believe in making money. Being disciplined and feeling uncomfortable is necessary for longerterm success. You are never immune from bad trading habits. None of us are - we are all emotional beings. The best that you can do is suppress your emotions and having discipline, and is essential to keep them in check. Assume The Worst - Money Management Many traders only think of the prots they can make from a trade, but never consider the worst eventuality. They are blinded by greed. The fact is that all the top traders tend to know their downside as soon as they enter a trade, and decide whether the risk of the trade is worth taking. Money management is essential for trading success, and by always assuming the worst, you can decide if the risk reward of the trade is right for you. As a broker once said to me about trading, Always assume the worst and you wont be disappointed. Things can only get better . No system makes money all of the time and no top trader does either, so it is important in these losing periods to have strict money management criteria in place to help you preserve your equity as best you can. Money management is, perhaps, more important than your trading method itself. You may have a successful system, but if it loses all your money quickly and recovers when you have lost your stake, it is of little use. You need to reserve your equity so you can stay in the game longer term. Always decide if you can take the prospect of the worst eventuality in relation to your trading capital. Know What Your Edge Is It is a fact that 90% of traders lose money longer term. Your edge is what separates you from them. Any successful trader has something that sets his or her method and personality apart from the majority and enables them to make money when others lose. You need an edge that you can dene and gives you condence that you can beat the herd. If you dont know what your edge is, you dont have one! Love What You Are Doing Trading is mentally demanding. Its tough and not all traders are suited to it. To illustrate how tough it can be, I have known several traders commit suicide after taking heavy losses. This is an extreme, but you get the picture of the demands it can put on someones personality. As in all walks of life, not everyone is cut out to be a trader. If the market makes you angry, frustrated, or all you can think about is trades you have on and nothing else, then trading is not for you. All the worlds top traders enjoy what they do. They know at the end of the day they will make money, which is the whole aim of trading in the rst place. They enjoy the challenge and the rewards trading can bring, and can handle the stress that is an inevitable part of trading. Final Words Many of the above traits may seem obvious, but the bulk of traders dont possess them and thats why they are doomed to failure. If you want to be successful in trading, you need to be aware of your personality. You need to know the environment you are working in and decide if trading is right for you. Trading is one of the greatest challenges around and with adequate education and preparation, can yield immense rewards for those willing to accept the challenge.

Forex Traders Common Mistakes

Over the last couple of years I have noticed that many people are eager to benefit from the Forex market but dont know exactly how or where to begin. Currency trading isnt as hard as most people think and with a bit of practice, you can enjoy market trends, banking profits along the way. To help you begin I would like to share with you a list of common mistakes that new traders often make and should try to avoid.Remember, the key to becoming a successful trader is discipline and following a set of rules: 1. Use leverage* correctly- Leverage is an excellent tool when used correctly. On one hand it can increase returns on trades, allowing you to benefit more from currency trends. On the other hand it can increase the value of your potential losses, decreasing your trading account. Traders have to balance their leverage according to their portfolios. One has to remember that iFOREX guarantees negative balance protection, meaning that you can never lose more than you invest. * The use of various financial instruments, such as margin, to increase potential profits on investments. Example: Accounts with a leverage of 200:1 allows you to trade 200 times your account size, maximizing returns from currency trends. 2. Lack of a trading plan- Traders can quickly lose their confidence if their trades are not successful. The large floating profit made, may often turn into losses. The key to success is to trade defensively and always know your downside by calculating the risk/loss potential of the trade. In other words, entering a position using a trading plan and correct money management. 3. Incorrect money management- Trading Forex successfully is a question of correct portfolio management. Proper money management means that you know your profit target and know the amount you are willing to risk on each trade. This is known as Risk/Reward Ratio. 4. Forgetting to use a stop-loss when trading - Traders often wipe out their accounts due to wishful thinkinghoping that their trade is going to head back in the correct direction. Using stop-losses prevents traders from taking hard hits, by providing a safety net, automatically exiting the trade. Traders using correct risk/reward ratio including stoplosses can successfully beat the markets. 5. Accepting loosing trades - Many traders lose confidence after a couple of losing trades which reduces their ability to become an efficient trader. The currency market requires a gradual learning curve that demands persistence, trial, and mistakes to enhance your trading abilities. Learn from your mistakes, conquering the market step by step. 6. Capital preservation - Profits are there for the making, but the real key is not to make money; it is actually keeping it. Hold profitable trades and cut losses quickly. 7. Limiting profits and holding onto losses This is very common among new traders, and normally results due to the lack of a trading plan. After one or two losing trades, traders often find themselves taking small profits even though the trade could have been a potential huge profit maker. Use stop- losses to eliminate the problem. 8. Becoming greedy When traders have an open trade that is making them profit they often forget their predetermined target for the trade, as they are sure that the trade will yield more profits. If the market reaches your determined level, either bank the profits or move the stop-loss to that level. Remember that the markets are dynamic and trends can change almost immediately 9. Over confidence - If you are experiencing a winning streak, comfort yourself by knowing that all traders loose during their trading career. The question is how much you are losing compared to how much you are winning. Using correct risk/reward management will yield profits over time. 10. Dont put all your eggs in one basket Diversify your portfolio using numerous positions. Traders ruin their accounts as they tend to open only one large trade on one currency pair.

11. Plan your trade before you open the position - When your trade is open you will often experience emotions like greed, forcing you to change your pre-determined target or stop-loss. Trading according to your original plan will often prevent additional losses. The currency market is the largest and most dynamic market in the world with a daily volume of over $3 trillion.
Following a few simple rules you too can grab some of those profits waiting to be taken.

An Introduction To Breakouts Example

In todays trading world of complex technical indicators, breakout methods seems comparatively simple. Its simplicity is deceptive, in that it remains one of the most effective ways of trading, and if used correctly, you will be in on all the major moves regardless of the market traded. In fact, its simplicity makes it a tool that can be used by all traders from novices to seasoned market veterans. The logic behind breakouts is simple to understand and easy for any trader to implement. An additional benet of breakouts is because the logic is so simple; traders nd it easy to trade with discipline. This is not so with many technical indicators, or complex methods where the logic is not so easily understood. If you are going to trade any methodology with discipline, you must rst have condence in its ability to work. This is where the simplicity of the breakout method of trading is its strength. Traders understand it, and can trade with discipline, even when faced with a series of losing trades because they know the logic is soundly based and will make prots over the longer term. Denition Of Breakouts Trading breakouts is not a new concept; traders have been using breakouts for centuries. Today many of the worlds top traders trade breakouts for big prots. So what actually is a breakout? A breakout is the point at which the market price breaks away, or moves out of a trading range. The trading range can be for any length of time but once prices exceeds the high or low of the range, a breakout has occurred.On the above chart when the yen breaks out, it is the start of a great up trend. It is these type of trends that all traders are looking for, as they yield the biggest prots. Here is a potential breakout forming. Why Breakouts Work The accepted market wisdom is buy low sell high and this has been taught to us in high school and is the accepted philosophy of many of the worlds investment community, from economists to brokerage houses. The theory sounds ne, but it is very difcult to make money trading this way. The logic of breakouts is contradictory to this accepted market wisdom and works on the premise: That in order to make money you should buy high and sell higher in a bull market, and sell low buy back lower in a bear market.So why is the traditional investment wisdom of buy low sell high so difcult to make money in the real world of trading? For this we need to take a closer look at price action and the attitude of the majority of investors. Alexander Elder in his excellent book Trading For A Living, sums up perfectly why following breakouts can give traders the opportunity to catch the big moves: When you identify an uptrend and decide to buy, you have to decide whether to buyimmediately or wait for the dip. If you buy fast, you get in gear with the trend but your stops are likely to be farther away and you risk more. If you wait for the dip, you will risk less but will have ve groups of competitors: longs who want to add to their positions, shorts who want to add to their positions, shorts who want to get out at even, traders who never bought, and traders who sold early but are eager to buy. The waiting area for a pullback is very crowded! Markets are not known for their charity, and a deep pullback may well signal the beginning of a reversal. This reasoning also applies to downtrends. Waiting for pullbacks when a trend is gathering steam is an amateurs game. If you want to have the opportunity to make the really big money from the big moves, you need to get in at the start and follow the move. Alexander Elder implies that you risk more than on waiting for a pullback. This is true in theory, but here you have to understand that theories are of no use until they are applied in practice. In practice, history shows us that by taking what seems a bigger risk by following a market breakout is less risky than waiting for the pullback. Why?

Because the probability of the trend in motion continuing once the breakout has occurred, is higher than the trend continuing after a pullback has occurred. Why Breakouts Increase Protability & Decrease Your Risk Perhaps the most famous traders in the history of trading were the Turtles. The turtles emerged from a meeting between Richard Dennis and Bill Eckhardt about whether great traders were born or made. Bill felt that he could teach people to become successful traders. Richard felt that successful trading was down to genetics. In order to settle the debate, it was decided to advertise for trading apprentices and then try and teach them to become successful traders. The students were called the Turtles when Dennis explained the concept by saying they were going to grow traders like they do turtles in Singapore They were the most successful trading experiment in history, earning an average compound rate of return of over 80%. It was proved that with a simple set of rules complete novices, with no experience, could become successful traders. The rules used were simple and included the use of breakouts in the methodology taught. While only one component of the overall plan, the breakout methodology was very important part of how the traders actually got into and held the big trends for maximum prot. In the book Market Wizards, there is a very good interview with Bill Eckhardt and his analysis on what made the Turtles so successful. He illustrates the point further that traders, in their desire to buy low sell high, create risk for themselves. By doing what is conventional and comfortable for them actually means they end up missing the biggest trends, and creating a greater risk for themselves, by lowering their probability of entering at the right time and making an overall prot. I dont like to buy retracements. If the market is going up and I think I should be going long, Id rather buy when the market is strong than wait for a retracement. Buying on a retracement is psychologically seductive, because you feel you are getting a bargain versus the price you saw a while ago. However, I feel that approach contains more than a drop of poison. If the market has retraced enough to make a signicant difference to your purchase price, then the trade is not nearly as good as it once was. Although this trade may still work, theres an enhanced chance that the trend is turning. Perhaps even more critical, a strategy of trying to buy on retracements will often result in your missing the trade entirely, or being forced to buy at an even higher price. Buying on retracements is one of those psychological ploys that gives psychological satisfaction rather than providing any benets in terms of increased prots. As a general rule, avoid those things that give you comfort; its usually a false comfort. Breakouts Make Your Money Work Harder Another important reason for using breakouts, rather than buying low or retracements, is that trading capital is utilised better. It is the aim of all traders to lock into and hold trends. The fact is, however, that markets spend most of their time in trading ranges going nowhere. Many markets dont trend for months or even years. A trader who takes a trade in the anticipation that it will move, may have to wait a long time to see the trade move his way, if it does at all. This can tie up capital for long periods that could be utilised more productively elsewhere. The big advantage of breakout trading is you are only entering a trend in motion. As we all know, a trend in motion is more likely to continue than reverse. This is a basic premise that technical analysis is based upon, and breakouts get you in, as the trend emerges, and has a high probability of continuing. You therefore know you are only entering markets that have a high probability of trending strongly and making you big prots. Validity Of A Breakout Be Selective While many trades can be considered for trading breakouts, there are some trades that are more valid than others (which we have seen on previous examples) i.e., the probability of the breakout turning into a strong trend are greater. We need to look at some basic criteria for grading breakouts in terms of their probability of success. 1. As a general rule, the more times a line of resistance or support has been tested the more important the violation will be if it occurs. We generally never trade less than three tests. 2. The time frame between the tests of resistance and support is also important and generally the longer the support or resistance has been in place, the more valid the break will be when it comes. A period of months is obviously a far more valid period than a few weeks. A break above this level is very valid as resistance has lasted so long, and has been tested so many times.We saw at the start of this essay how the Yen overcame resistance on the daily chart and entered an

accelerated up trend. The importance of the 8650 level can be seen even more clearly on the weekly chart where the resistance had been in place since September 2001. When looking for breakouts, the longer term monthly and weekly charts should be looked at rst and the daily chart used for timing.On the Canadian dollar chart, you can see several uses of breakouts in a shorter time frame. A - The initial break above resistance sees an accelerated up trend. B - After the break and a fall the market settles into a trading range. Breaks from trading ranges tend to be highly signicant, as they can indicate the end of a period of low volatility and the potential for a trending market. C - once the trend is under way, breakouts occur in smaller time frames. 3 are indicated with a 3 - 5 tests of resistance. Once a trend is in motion, traders can use these to get into the market. They should not be used until a market starts to trend strongly. Trading Breakouts & Placing Stops Once a clear break has occurred, the odds are the trend will continue in the direction of the break. If the trend reverses quickly, and goes back to the breakout point rather than continuing, the break is likely to be false. Stops should therefore be at or near the breakout point. A Simple Plan For Building Long Term Wealth Breakouts have worked and will continue to work as they take advantage of human psychology, and the fact that the vast majority of traders are not prepared to act decisively as a potential new trend develops.The fact that breakout trading is so simple does not diminish its potential to make large prots over time. In fact its simplicity, as we have seen, is its strength, despite subtle changes in the markets. Over the years,breakouts continues to work because the underlying premise on which it is based (human nature) remains constant. There is no correlation in the market between the complexity of an indicator or method and its success. In fact, the opposite is true; most of worlds top traders who have made consistent prots have used systems that are essentially simple. Simple systems are the best because their logic is easy to understand and implement. If the system is easy to understand it is easier for a trader to execute it with discipline. There is no point in having a system unless you have condence in it to trade it with discipline, even when faced by a losing run of trades.Trading breakouts is a great method for catching the really big moves that can pile up big prots - that is the aim of all traders. Every trader could use a breakout system if they wanted to, the fact is they dont, for reasons stated earlier. The fact that the bulk of traders dont want to is the fundamental reason why they work and will continue to do so. 1) Introduction about the Forex trading 2) Benefits of the forex Training 3) What is trend Line? 4) How to Trade. 5) How to take long and short position. 6) Types of chart. a. Line Chart b. Bar Chart c. Candlestick Chart (Briefly Description on Candlestick Chart) 7) What is Resistance & Support? 8) Multiple Time Frames. 9) How to use following Indicators in your Chart a. Moving averages b. Fibonacci Retracements c. Relative Strength Index (RSI d. Stochastics (STC)

e. Momentum f. Time Frame ; g. Bollinger Bands 10) How to calculate P.P (Pivot Point)