How to Think Like a Successful Trader

You’re at it again, you’re spending the day sitting before a chart and bickering with yourself over what trading card to play next.

You think you have it, you feel the adrenaline coursing through your veins as you watch all the signs point towards profit and success for you, success so close you can almost taste it but wait!- there’s a shift in the trade, and it’s unexpectedly moving against you, your shoulders sag, both your stomach and your mouth drops.

You wait and watch in dismay as the trade continues to move against you and then that’s it. You’ve lost, again, you’ve made the same mistakes you made the last ten times.

What you need to realize is that you can’t help what you’re feeling but what you can do is try and make a change. As a trader you need to understand that emotions and feeling often take over all logical thinking and successful traders keep their feeling in tow when trading amongst doing other things.

Successful Traders are Fully Aware of the Workings of Their Minds

To think like a successful trader you need to develop an understanding of your mind, especially when you are trading, a good trader knows his limits and what his goals are, he does not easily get distracted by other unimportant things while trading. Good traders know what it is that will motivate them and what kind of thoughts they should be having while trading that will have a positive effect on the way that they trade. So to get the mindset of a winner, first get to know your mind and get to know it well.

They Know the Importance of Being Biologically Healthy too

What most traders don’t realize is that their biological condition has the ability to greatly impact their mental stability while they trade. Something as simple as taking deep breaths at the right time could have been the difference between you losing or you winning. The mind and the body are linked together instead of getting worked up and letting the adrenaline take over them, successful traders exercise and know well enough what the advantages of being healthy are.

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How to Trade With Your Gut

The best traders are observers and anticipate their moves beforehand; this is called the “gut feeling”, every trader should rely on the gut feeling while trading as it is something that will undoubtedly establish to a higher degree as you gain your experience in the market.

Gut feeling can be understood by starters if we call it trading inspiration as well as high hopes, this is a very significant and dominant tool that you will need to develop to move up into the top 10% outstanding traders.

Gut Feeling and Price Action Trading

The various strategies that the trader uses will eventually become common facts to the experienced trader and as time goes on, the traders’ gut feel will help him determine if a trade is worth taking or not. Sometimes the trader may not even know why he is choosing the side of the market and not the other but his experienced mechanism will build up his thinking level, while he makes decisions the more experience and exposure that he has gotten with the charts and price action, the more prompt he will become.

It won’t come very quickly and will require lots of time of practice and experience but as you look at the charts and price actions, the gut feel will develop along with the development of strategic thinking.

Practice Makes Perfect

A lot of professional sports players have put in massive amounts of effort and practice and because of this; they have been able to go pro, they have played with a wide range of different players and this is what gives them the gut feeling to what their opponent’s next move will likely to be, this gives them leverage out on the field, much in the same way, in your trading strategy when you’ve put in enough screen time, you will start to develop the gut feel. There are many more situations where gut feelings takes place, whether it be sports, trade or other more practical fields in life, but in all, it surely requires experience and commitment for development.

Being Objective

There might be and most often are two views to something in a market, one trader might see a chart and think its convincing and the other might think that it’s vociferous. So, it would be best for you to view the market objectively rather than subjectively, if a chart looks very long, you may have a gut feeling that it’s wrong and although we can’t see it, our subconscious mind is being objective, it is having a view from the opponents side and guiding us to that view. Therefore, our subconscious can be objective without us even knowing because it sees the other point of view in a trade based on our previous experience on it.

Are you a trader who uses their gut feeling often while trading? Do you feel like you need to start developing your gut feeling? Be sure to let us know!

- Source from: https://goo.gl/pPHoLn 

Countdown To The EU Referendum: Can The British Government Avoid Brexit?

The countdown begins. Within a month, precisely June 23rd, the British will vote to determine its future within the European Union. This is coming in the midst of doubts of what the outcome of the referendum will be. The uncertainty is already being seen in markets across the globe. It needs to be determined how we all got here, the keys are now offered on a historical query that can trigger a process hitherto unexplored. No nation has ever left the EU block. How then will the block manage if the eventual outcome of the Brexit referendum turns out to be unfavourable to the block?

Who Can Vote in the Referendum?

All British citizens that are 18 years and above, Irish and Commonwealth citizens living in the UK , along with British citizens residing abroad  who have been on the electoral register in the last 15 years. European residents in the UK may not vote.

Can Spain Claim Gibraltar?

Although Gibraltarians are not lovers of the community project, but they are ready to defend themselves so long as it gives them a solution to the difficult relationship they have with Madrid. For this reason, all political parties of the Rock are campaigning within the EU block. According to the treaty of accession of the United Kingdom to the EEC in 1973, the Rock came as a "European territory for whose external relations the UK government is responsible for."

The Spanish has emphasized on several occasions that London does not want to leave the block. Although, according to British newspapers, if that scenario occurs, Madrid could take advantage of it to return to claim sovereignty over the Rock 

What is the Official Position of the British Government?

Given the popularity in recent years, the Eurosceptic UKIP were the ranks 'Tories' which pushed David Cameron to convene the referendum. The 'premier' is campaigning for permanence. But to avoid internal revolt, he was forced to give freedom to his people to defend the position that most convince them. Half of the Conservative MPs, including five ministers, are campaigning for the exit. The most significant case is Boris Johnson. The former mayor of London had always defended the European project, but now advocates leaving the club. According to analysts, more than conviction, by a sheer strategy to prepare his way to party leadership.

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Is it Possible to Make Currency Trading Your Career?

It all really seems easy enough doesn’t it? Especially if you consider the fact that it’s not every day that you run into someone who’s a successful forex trader, you automatically conclude that there mustn’t be very many people in this field and if there aren’t many people in this field, it would be easy to rise to the top with the proper knowledge and training, correct? Well, I hate to rain all over you parade but the fact of the matter is that despite the fact that not many people make trading currencies their profession, the ones that do, are so powerful- we’re talking Soros- billionaires kind of powerful that you can’t hope to bring down or accompany on the top. So whatever leverage you think you might have over everyone else just because you thought of this brand new way of earning- forget about it because you and your five hundred dollar bank account are not running into any quick money any time soon.

The forex market is fluid which means that it’s constantly changing- experiencing fluctuations and such. It’s fast and unpredictable and sure, this may mean that you can make money fast, but what it also means is that you can lose money just as fast- if not quicker. Because they’re ever changing, it’s hard to predict much in the forex market regarding currencies and government laws unless you’re one of those big shots with insider connections.

With the rise of scammers and manipulation it’s quite easy to fall for the whole get rich quick ordeals and schemes, instead of wondering whether or not you should take the opportunity and run, you need to ask yourself (and the person offering the opportunity to you) why you’ve been given this opportunity and why you of all people. If the answers you give yourself or get from them do not seem legitimate enough, take that as your clue to opt out of the whole ordeal right then and there.

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How to Expertly Sell a Losing Position

Let’s say you’re a stockholder who wants to sell your stock for whatever reasons - usually the reason is that your stock is losing its value- but can’t fathom selling your stock at a time when losses might be larger. There are certain rules and regulations that if followed by traders can lead to great profits rather than selling at a loss.

Having a Compliant Selling Strategy
When choosing a suitable selling strategy, the nature of the company needs to be taken into consideration, there are many different types of investors with many different objectives and not all those objectives can be achieved all together- compromise must always be made. General strategies cannot always be used like the pricing strategy when other strategies such as the stop-loss strategy can be employed, however the stop-loss strategy has the tendency to become less and less useful as the investment time frame extends itself.

The 3 Fundamental Questions
To learn more about yourself as a trader and your investing style, you need first answer the three fundamental questions the first being why you bought the stock in the first place, what changed since then and whether or not that change alters your reasons for investing in the company. If your stock has gone down in price there is probably a reason why, you need to pinpoint that reason and understand how that affects the way in which you trade and why you trade with a specific company.

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Prospect/Loss-Aversion Theory

Prospect theory is a behavioral theory in economics which describes the way in which people tend to choose between probabilistic alternatives that involve risk and cases where the probabilities of outcomes are known. According to this theory, people- in this case forex traders make decisions based on the latent value of losses and gains rather than the ultimate outcome foreseen.  Practically speaking, it seems all too justified to expect a forex trader to prefer a sure investment rather than an unsure one, however what Prospect theory suggests is that traders reserve specific quantifiable emotions over losses and gains separately for each one.

Loss Aversion
Loss aversion refers to people's inclination to avoiding losses rather than acquiring gains, psychologically speaking, a lot of studies show that losses are more powerful than gains however due to human psyche and greed, when traders evaluate an outcome comprising parallel gains and losses, they prefer avoiding losses rather than making gains.

The Endowment Effect
Accordingly, originally, loss aversion was proposed as a justification of the endowment effect, which is the fact that people place a higher value on a good that they own than on an identical good that they do not own, as is the human psyche. Loss aversion and the endowment effect go against the Coase theorem which states that "the allocation of resources will be independent of the assignment of property rights when costless trades are possible.”
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The Trader’s Cure – Stop Overanalysing

Every trader, at least once in his career has come across a trade setup that looks perfect at first but then when they start to analyse it, they begin to feel less and less sure about that trade. Unquestionably, it is good to study and analyse every trade setup before entering it but overdoing this process and overthinking about it can become a problem for you.

This is quite common in the trading world, traders often over-analyse themselves right out of a good trade setup and it can become a huge problem that can have several negative consequences on their trading performance.

The solution for this problem is simple, ignore these influences. You should focus more on mastering your strategy, sticking to your plan and accept the fact that those external influences only hurt your actions.

The next problem is psyching yourself out of a good trade. One of the worst feelings a trader can have is when he/she watches the very trade they left, take off in their favour. The sole reason of them not entering it was that they thought ‘too’ much about it. All the traders have been in this scenario once in their careers and the cure for this problem is again, simple, don’t think so hard about it.
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