Here is what happened in the markets this morning.
What is passive trading?
When most people hear the word passive, they think of something that can be negative. For me, having a passive attitude in trading has been a really positive thing. Some of my best trading days and weeks have been during times when I have a passive attitude in how I enter trades. To better describe this, my thought going into a trading session with a passive attitude is “I might enter a trade, and I might not.” Some of the worst trading days for me are when I wake up thinking “Boy, I can’t wait to get into a trade and pull some pips!”
What I have found is quite fascinating, it is almost as if I take power away from the market, and the Market Makers when I trade passively. Truthfully, that is exactly what happens when you trade more passively and less emotionally. The market makers make their money by fooling retail traders into entering positions, so the more emotionally you trade, the more you become a puppet on a string. The more passively you trade, the less power and control they have over you. It’s a beautiful thing!
After I talked to Steve, and read his blog post, I started to see the bigger picture, and I started to understand what was going on with my trading. At this same time, there was a period of a couple of weeks where I was really busy. I had to travel to California for work, I had a busy schedule each day, and I was starting work at 6AM, so there was really no way for me to trade during session. I almost tried to, I even brought my laptop with me. But I decided that I would take the week off. I was pretty busy the following week also, so I went almost 2 weeks without trading. This turned out to be a really good thing for me.
Taking time off from trading, accompanied with new ideas and a fresh mindset really helped me to turn things around. Does this mean that I’m pulling hundreds of pips a week? Nope. In fact I think that I’m at 18 pips for the week so far, but I’m ok with that. Slow and steady wins the race. The tortoise wins, every time.
I had always heard Rob G. say that whenever he loses two trades in a row, he takes the rest of the week off (I’m pretty sure he said that). I always thought “Why would he take the rest of the week off? Can’t he just start fresh the next day?” I think I’ve learned a good lesson here. Time off can be a powerful thing. If you find yourself spun out in your trading, take a few days or a week off. I’d bet that you come back with a new perspective. Taking a few steps back is a great way to get a better view of whats really happening.
My recent trades
Since this transition I have been doing much better. Once again, I’m not rich, nor am I slaying hundreds of pips but I’m in control and my trading is relaxed. This is such a stark contrast to the cortisol-fueled, greedy, upset, hunched over, anxious, money losing trader that I was a few weeks ago, “gargoyled” over my laptop, hoping and wishing that the market makers would let me have just one little piece of profit. Recently my trading has been much more enjoyable. I am managing my account by keeping a reasonable lot size. I am calm. I sleep in until 5:30 if I want to. I realize that I don’t have to trade. I no longer have to fight myself and make up all sorts of rules because I see the big picture.
My intention in saying all of this is not to boast or sound like I have it all figured out, but to just point out that we often make things a lot harder than they need to be. Sometimes all it takes is a slight change in attitude, or a simple shift in how we view trading to turn things around. I had taken something fun and made it stressful by focusing in the wrong things in my trading, then adding rules and more stress to correct it. That all went away (for now) when I started focusing on taking things slow and keeping things simple.
I encourage anyone who is having a hard time to remember that you have plenty of time to learn to trade (that’s another thing Steve said). Take it easy. It can be challenging but it should also be fun. If you find yourself stressed out, chill. Take a break. (Side note: taking a break helped me a lot, but I think that it is important to note that it wouldn’t have been such a powerful time if it wasn’t for the fact that I got some good advice). With that being said, ask someone for help! Get some advice. Participate and ask questions on the webinar. Read books. Use all of the tools at your disposal. Don’t be greedy. Keep the dangers of the market in perspective. Keep it simple and relaxed. The reason we learn to trade is to take stress out of life, not to add it.
Okay, okay, I know, I’ve heard it too – all the modern pseudo pop-psychology of ‘The Power of Positive Thought’, ‘Attitude is Everything’, the ‘Law of Attraction’, etc. Aren’t we all getting just a little bit tired of all the clichés? I mean, it can’t all be true, can it?
Well what if it is? All of it. And what if it’s the one thing that is keeping you from where you want to be; maybe in your trading, personal small business, career, personal finance – you name it.
As it turns out, more winning athletes, entrepreneurs, political figures, and other notorious characters that I can shake a stick at, have at one time or another referenced their mindset as a key attribute in the success that they have accomplished.
If all of these people who have at least financially achieved a status that most of us would aspire to reach, were to openly suggest that this may be a key part of their success, why oh why, must we roll our eyes at the idea of doing such a thing ourselves?
I read that Muhammed Ali once said, “It’s the repetition of affirmations that leads to belief. And once that belief becomes a deep conviction, things begin to happen.”
Admittedly, I’ve always had mixed feelings about affirmations. Part of me felt like there was obvious truth to it, and the other part of me felt that it was redundant and dishonest.
However, I trained in a gym with high level athletes for years. During that time, even though I personally had a fairly high level of fitness, I had generally plateaued. Now it’s not what you are thinking, one of these stories where I was actually reading Vogue on the treadmill and texting on the weight bench and calling it hard work. No, this was something else. One day I thought about the type of (affirmation) dialogue I was having with myself repeatedly: “This is going to suck’”, “Ahh this workout is so gnarly”, “I’m about to get wrecked”.
There wasn’t much positivity in my dialogue. In February of 2015 I decided that I had to change the voices in my head (fun, huh?). I decided then and there that the outcome of every workout was going to be deemed awesome no matter what. Anytime I was going to do, or was doing, a very large effort in the gym, I repeated to myself, “this is going to be so good”, “I’m about to gain so much fitness”, “I love working out”.
So what happened? In the next 6 months I PR’d every movement we focused on in the gym. Seriously—all of them! Max pull-ups, deadlift, bench press, pushups, 2K row, bw in calories for time, 10min air-dyne test. Was there a correlation? Undeniably so.
So what does my fitness have to do with your trading you ask? Well, once you’ve been around the FOREX market for a while, the price action of the market itself is relatively simple. It either goes up, or down, and always for good reason. So why is it that some people interact so well with it and get rich, and others can’t seem to figure out up from down and blow up their accounts?
If you saying things like, “I got into this trade, so of course it went the other way”, “I suck at this”, “You’re such an idiot”, “This whole thing is a hoax”, “Is this ever going to be viable?”, “I’m not very good at this”… well you are, as Muhammed Ali would say, one of those people who are repeatedly affirming their thoughts into a belief, which is ultimately becoming a deep conviction and will inevitably happen.
Let me ask you this, how long would you hang out with somebody that was telling you all of those things? Not very long, I would hope. So instead, try this on for size.
‘I’m becoming a world class trader.’ ‘I’m getting it more and more every day.’ ‘I’m a great learner.’ ‘My account is starting to grow exponentially.’ ‘Trading is the hottest thing since sliced bread.’
Now of course, saying all of the right things probably won’t do much for you if you are already doing the right things like showing up consistently with a great attitude, continuously studying your fx365i virtual classroom, keeping accurate and thorough records of every trade you make, taking screenshots of your own trades and reviewing them weekly. However, if you aren’t doing all of those things, this might be the missing link.
Lastly, what is it that you are visualizing? How often are you imagining what it’s going to feel like to open up your trading station and have a six-figure account balance? How often are you imagining what your perfect trade setup would look like, and what it would be like to be in that trade? How often are you visualizing what it’s going to be like to close out a trade for five figures in profit? How often are you visualizing what your monthly account draw from your trading account to your bank account is going to look like?
If you are thinking, wow that sounds like a lot to do, I ask you this: How much thought do you think Muhammed Ali gave boxing? And if that’s not enough motivation for you, remember, Michael Jordan didn’t make his high school basketball team.
In case you’ve been living under a rock for the last decade, technology is changing the world at a more rapid rate than ever before. For hundreds of thousands of people, the changes technology has brought has created a time of uncertainty, turmoil and desperation; and for others, a time of hope, gain & prosperity.
The age old adage, ‘when the going gets tough, the tough get going,’ has never been truer. However, as things have changed more and faster, at steeper curves of progression, many have found that their efforts of working harder has done little more for them than coming up short. If it hasn’t crossed your mind before, it may be time to look at a way to work smarter, instead of working harder. While people have been saying that phrase to me for years, I never really understood it until I was introduced to the concept of leverage.
If you are a forward thinking individual, you have crossed a time when you’ve looked at someone who has achieved high levels of financial success in their life and thought to yourself, ‘they can’t be THAT much better than me; they can’t be THAT much harder working than me.’ If you’ve thought that, I’m here to tell you that you are absolutely right. They most certainly are probably neither. What they are doing better than you though, is playing a different game. And if you ever try to race a Ferrari on a bicycle, no matter how strong you might be, that is a losing proposition.
The person who has leverage however, has found a way to earn money not based off of an exchange of their own time, but from the time of others, a business system that reaches a much bigger group than they can themselves, or by leveraging their own money. Unfortunately for most, in times of trial and tribulation, few people tend to rethink everything they know and usually try to find a higher hourly exchange for something they already have experience with or think they could do.
If you’ve been scratching your head looking for a way to beat the game you have been playing, it’s time for you to learn a skill set that can offer you massive leverage. Enter, “trading Foreign Currency”, or “the FOREX ”. Without providing an over the top education in this blog about what it is and how it all works, just understand that people buy and sell money to each other all over the world every single day. As a result, this market behaves in a certain way, and by investing your time in getting a proper education in this market, you can learn a skill set that maybe for the first time in your life, can provide you massive leverage.
Just the other night, using the methodology that I have learned as a student at the fx365 Institute, I was able to identify an economic news event before it happened (1. 00 AM PST). I set an appointment with myself to evaluate the market at that time (I jumped on about 30 minutes prior), created a trading strategy, and in about an hour from the time I opened my computer, I closed my trading station with 1 trade; a profit of 9.8 pips. Now you’re probably asking yourself what a pip is and what that means to you. A pip is an increment by which the forex market is measured in. Anytime you enter and exit a trade, your profit or loss will be measured in pips. Here is the important part: When you learn the skill set of trading, your quest for pips remains exactly the same. However, the amount of money that they are worth to you changes over time. In fact, you can assign as much or as little value to a pip as you are comfortable with or that your account margin will allow.
Recognize here that the skill set that you are learning never changes. And here is where leverage enters. That 9.8 pip trade for me on that night was worth $0.98. For many, to wake up in the middle of the night, learn something completely foreign and new, earn just shy of a dollar and to be pleased with it is laughable. The fun part however, is soon that denomination will be worth $9.80. Great, you just bought yourself lunch, maybe. Well what about $98 dollars? $98.00 for an hours’ worth of work starts to be a bit more of an entertaining proposition. What about $980.00? Could that put a dent in some of your bills each month? As you become a more competent trader, you can trade; 10 pip, a $1 pip, a $10 pip, a $100 pip and so on.
Where else can you learning a skillset that over time you could put hundreds of dollars an hour into your pocket? On top of that, a skill set that can be used from anywhere that you have a secure internet connection.
While this is only the tip of the iceberg, and of course, there comes inherent risk and fear that surrounds the financial markets, with the appropriate education and an approach similar to what one might go through to become say a licensed massage therapist, a nurse, a welder, trading the forex might just be worth a look. The fx365 institute is the only school in the world where they trade live with you every day, year round via a professional broadcast with professional traders. It’s your best bet to work smarter instead of harder.
Best of Luck!