A riveting discussion is guaranteed at every Wednesday 9:00 AM PST student counsel meeting. This week’s was no different. One of the most interesting topics we covered was the meaning of goals. It was clear that each FX365i student has their own idea in the matter.
I recall a conversation with one of my mentors that transpired as follows:
That conversation led me to think goals beyond what I had previously imagined, to which I arrived at the realization that goals operate both on a fundamental and a technical basis.
Technical goals are simple as they are numerical and absolute. Either you made the 55 pips by closing time on Saturday, or you simply did not. There is no grey area.
But yet there exists another element to this equation. That element is related to your original intention.
When you made the decision to become a trader, your original intention was likely to fall into one of two categories (or a hybrid of them). I explain below.
If you are in this category you became a trader because you understood that it is your opportunity to “buy back your freedom.” Your original intention was to discover a means of supporting yourself (with relatively few hours of work) so that you could spend your time pursuing your other passions.
You understood that if you meet you goals at the end of the week, there is no need to trade any further. In laments terms, “trade for 2 hours… then go surfing” or “trade for 2 hours…then go knit a sweater” or “trade for 2 hours… then go play catch with your children” –you get the point.
“The Trading Passionate”
Perhaps when you became a trader your original intention was to develop a new skill, as was the case for me. Apart from learning the markets and regaining my freedom I looked to trading as a new hobby. I have an interest in it, my interest is fueled by a deep passion and an ever-growing fascination with the financial markets. Essentially the mantra of the trading passionate is a different. It follows this vein of though: “trade for 2 hours…learn the skill”, “trade for 2 hours…get better”, “trade for 2 hours…ask a question”–you get the point. In some respects, the trading passionate are also the perpetual students that want to know everything about the markets.
We have standard goals at our school; it is a weekly 35-pip goal. One of the opinions that I have recently adopted is that all technical goals must be a prime number. On the basis that it must not be divisible by 5, or more specifically, the number of days we actively trade at school each week.
For my peers that don’t have the opportunity to take part in our weekly discussions, the position I expressed during counsel was as follows:
A 35 per week goal is in essence requires a 7-pip trade per day, however, the market isn’t necessarily favorable for 5 days worth of trading. Advanced traders (whether freedom or passion driven) do not necessarily have to trade everyday. However, if for instance your goal was 33 pips a week, your mindset shifts. Now you’ve created a mindset that you can trade 3 days at 11 pips each and either watch the market for two days (trading passionate) or surf for 2 days (freedom-centric).
In further defense of my position…
A prime number is not divisible by anything. There are no daily requirements to be on track, thus no pressure that carries over into the next day. The only requirement you have is that you make it past the finish line on Friday, emerging at the numerical goal that you intended at the start of the week.
Lastly, Todd wrote a lovely article about goals recently (Smart Goals for Currency Traders). It is great reading that is bound to get you thinking about your own goals.
Until then, Trade Free or Trade Passionate!
Please feel welcome to share your thoughts in the matter. Are your goals fundamentally or technically based? I’d be delighted to hear more from you.
“If someone offers you an amazing opportunity and you’re not sure you can do it, say yes – then learn how to do it later.” -Richard Branson
As many of you know, there are some groundbreaking changes taking place at the institute this month. Most noteworthy of all is that the institute will now be using Smart Money Profile (SMP) as the school’s primary platform for instruction.
Before I share my list of concepts that Wealth Smart students need to know about the SMP platform, I would like to take a moment to celebrate Wade and Shane Guth for their amazing work developing and fine tuning the revolutionary SMP software. Additionally, due to Shane’s skillful and dedicated teachings, every SMP trader I know absolutely loves the platform. Kudos gentlemen!
I have been an SMP student for three months. With that in mind, here are the things you’ll need to know as a new student making the jump into the SMP program.
When a person first opens the SMP software to trade it for the first time, it may be a little intimidating. The multi-colored candles, lines, dots, boxes and the ever fluctuating rate indicator can easily create a sensory overload for newcomers.
Although the task at hand may appear difficult, once you understand the Market Makers business model, you will understand the genius and simplicity of the SMP software. By helping you discern what the Market Makers are doing, the SMP platform allows you to make predictive and logical assumptions about potential trading opportunities. As you learn to recognize the best trading opportunities, your win rate can soar into the 70 and 80 percent range.
From time to time, cross-traders at the institute (those that trade SMP and WealthSmart) explain that one of the greatest advantages of the SMP software is that the exit points for SMP trades are clear. The SMP platform is a map. As part of that map, the software clearly shows you points where the market may turn or possibly take a large breath. Once price approaches one of these points, it is easy to see your exit and book your profit.
Additionally, as you gain experience with the software, you will learn to finesse your entries so that you have less and less risk in your trades. Of course every trade is unique, so there is no rule that says, for example, “Keep every stop loss set at 6 pips.” However, within a relatively short amount of time, you will likely be able to keep your risk at a minimum as you enter into high probability trades. The ability to combine high probability entries with clear profit targets and low risk exits is a magical combination that can lead to long term trading success.
When you first get involved in the SMP program, you will find there is quite a bit of subjectivity to everything happening in the SMP arena. Some students may see the market preparing to go long, and others see it preparing to head in the opposite direction. No matter what you see on a particular day we encourage you to share it!
There are no guarantees in trading, but if we are able to gather our information together, we all benefit from the opportunity to make good, well-informed trading decisions.
For anyone who may be worried about making the transition from WealthSmart to SMP, fear not! You have already furnished great skills as a Wealth Smart student. Although the change may be uncomfortable at first, you will be surprised at how well you will adapt and become proficient with this truly phenomenal software.
One of the things that you will never hear someone say in the trading room is “get in now”. Interestingly enough, that is also the singular phrase that new traders desire to hear most.
Guess what? No one is ever going to tell you when the right moment is. Partially because the only people that know with certainty are the Market Makers and also because it is a decision that you have to learn to make on your own.
I will, however, offer you the the next best thing. I’ve had to process the same information as you, and with this three part article series I’ll help you make sense of it all. I am new at trading but I am darn good at learning and I’ll help you identify some of the checkpoints and victories that will be your first indications that you are “getting the hang of it.” Essentially, I’ll help you recognize when you’ve learned a valuable skill.
Before we start, I should tell you that all learning starts at the same place. Identification. Identifying is the first step in anything. If you can identify something then you can learn it (or even avoid it). Take a moment to think about it. It is a truism of life.
Learn to Identify When Something is Happening
When a person first starts trading none of it makes sense. It is a jumble of candles and colors and lines and dots and zig-zags in every direction that, as far as you know, can turn at any second. As overwhelming as it is, the first step in the process is simple. You just have to be able to identify the areas that something is happening. At this stage it doesn’t matter if you understand what is happening, only that it is a point of interest.
I’ll give you an example. When I was a 6 week trader I e-mailed my instructor about a middle-of-the-day losing trade that I took on my own. Lo and behold he also took the same trade, however, (as profitable traders have the tendency to do) he took it in the right direction and made 23 pips.
Imagine that out of the 288 5-minute candles that form in a day, a beginner of less than 2 months was able to identify something at the same point as one of her instructors? What a victory!
New Traders, when that occasion happens to you, celebrate. You deserve it!
In the next article I’ll tell you about another breakthrough moment. The moment that you begin to understand risk and entry. Join me in the upcoming week for the second article in this series entitled, “Ohhh! That’s What That Means….”
Fx365i / Smart Money Profile Student & Aspiring Forex Trader
Month one. It came and it went without incident. Uneventful as it was there have been a slew of great lessons to come out of this time.
When I first set my mind on becoming a professional trader I told myself that I would approach the process with an open mind. I also promised myself that I would do whatever necessary to acquire the beliefs and habits that I needed to become successful. My favorite week-4-take-aways are listed below.
1. What good is a win if you don’t understand how you did it or why it works? This was the first real issues that I encountered when I became a trader. I was an unexpectedly good Futures trader prior to joining FX365i, but I was always plagued with questions of why. Why did that trade work? Why does Fibonacci’s number sequence affect the market? Why does the market move up? Why does it move down? As one might imagine I was elated to learn about the Market Maker’s strategy. With this new-found information my understanding of the market is now clear.
2. The idea of taking a beating is not something to shy away from. If there is one thing that the Trader’s COG has taught me, it is that getting beaten up by the market should be approached with enthusiasm. The days, weeks or months that a person is losing in the market is not only a test of their determination but it is also a very important stage in the process. The sooner I make it to and past the “Dark Zone”, the sooner I will be successful .
3. Don’t jump the gun!
“I am a semi-profitable Futures trader, I have invested in the stock market (via my mother’s account) since age 13 and I have been in honors classes my whole life. So why can’t I trade real money from the start? I’m smart, right? And besides I have bills to pay”.
It’s amazing the things a person can convince them self when drunk on impatience and fueled by their ego. One day on my drive home (where all of my deepest thoughts happen) I had to be honest with myself about one of my character flaws. I know that the people at FX365 know what they are doing. I have faith in their process and their instruction, after all, that is why I signed up to be a student. I took that opportunity to humble myself. My peers and my instructors trade for a living and they too probably started slow and steady the same way I am being instructed to do.
4. Learning how to trade is not only about learning how to trade. I have come to discover that there are many associated skills outside of trading that a person must learn before becoming a professional trader. To list a few, I have had to learn how to utilize a new software, how to condition my body to the irregular hours and how to navigate to a neighborhood that I had never been to.
And that folks, was my first month as a trading student! Looking forward I am excited to complete my business plan in the coming weeks, to open a real money account and (like I mentioned above) to arrive at the “Dark Zone”. Bring it on Month 2!