You already know!

by jennifer on September 22, 2011

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Just a note about learning to trade.

I’ve known a lot of traders over the last ten years. I have been a fellow student and a fellow trader in many different arenas. I can’t think of one person (including me) who avoided the pitfalls of random trading, random gains and random losses; of thinking they had the perfect system or they had the market completely figured out, only to find themselves devastated one day when their friend, the EUR/USD, (or what have you), has taken you for a fool.

I have watched educators too, (and I won’t name names here) who speak as if they are the chosen ones who have uncovered the secrets of the markets. I have heard comments like these:

“If you’re a smart trader, you won’t have losses.”
“My traders [my students who pay me money] are living the life, trading these wild markets without any problems. We are not afraid of any market conditions, we trade them all, holding onto our winners for thousands of pips.” [And not speaking about our tragic losses, because we have excuses for those.]
“Forex equals Financial Freedom.”  ”You don’t even have to tell your friends or neighbors where all your money comes from.” [Says a man who I paid $8,000 for training who, as it turns out, never traded a day in his life).
“I can’t believe you’re only making 10% per month. I expected something on the order of 40-60%” .
“My trading system is working, but it’s only making 30% per month. We think we can make it better….” (Famous last words before you ruin everything you had that was good).

You’ve heard me talk before about random trading. Random trading is trading without a plan, so that all your gains and all your losses are random. You never arrive at a goal, and you never have to account for a loss. Winning 30% is no different than losing 30%, on the endless chasing after something better. My question is… Better than what? It’s random and never reached a point of completion, so trying to improve “it” is a false endeavor.  Everything gets changed up so often that there is no distinction of accomplishment. It’s all chasing after something, searching for greener grass in some new non-existent sure-fire cocky-ass system. If the system makes 30%, then stop and look at it, and make sure you understand why it did. Identify the part of your report that can be attributed to “luck”. If your losses were just bad luck, then so were your gains.(If you can improve your luck and make it repeatable, then please disregard, and plan out your next trip to Vegas…)  Make sure it’s repeatable, meaning, make sure you can repeat it!  (No, I mean every month. I mean, do it again and again and again. Now you have something to talk about.)  If you lose 30% and you give yourself a pass, then you haven’t made any progress towards your goal. Wait, did you have a goal?

I’m your blog-friend, which is funny because I’m not a social person. I never had a Facebook, I never sent a single Christmas card (sorry Mom), and I don’t go to my high school reunions. (You could say I’m borderline asocial. Ahhh. That’s sad.)  I’m here because I know I’m sharper when I talk to you and you talk to me. I’m not talking about hating yourself when you account for a loss. I’m talking about facing yourself and forcing the good stuff to the top. It’s in there. I have a trading notebook in which I write to myself all day long and I read what I write in an effort to keep myself on track. I have a set trading/money management plan, and I have goals which encourage me to stay on track, stay disciplined, stay motivated, and keep it real. I have a gauge so I know when I’m on track and when I’m not. It’s not random. I do NOT want sensational wins that I cannot repeat. I want to know what I can county on. Don’t you?

I have a friend, a mentor, and a notebook. I literally make reports for myself and evaluate them as if I were evaluating an employee. I have daughters who are counting on me to support them, and I don’t have time to waste. I am my own trader, and I am my own boss. The boss wants a report from the trader, and there are no excuses. I would encourage you to find someone to report to, even if it’s just to yourself, so you can face your trading with honesty and make yourself turn it into something realistic, attainable, repeatable, and calm. I am your trading-friend who genuinely wishes you and me well on all our trades. Time is short, and trading is no different. Make it right today.

Last thing… Rob Booker is the one who told me the greatest words I ever heard, which literally changed my life in every way. It goes like this… “You already have everything you need. You already know everything you need to know. You already know a trading system, and you don’t need to know anything else to be successful implementing your system. You already are complete, not lacking for anything.”

I’m not as good with words as he is, but if you’re still reading, please read this. You already have everything you need to be successful. Sort things out. Get your trading organized. Write a report, honestly evaluate your trading habits, and make a plan that you can stick to. The only thing I know I can promise you is that you already know all the right answers to all the questions you think you have. Don’t give yourself a pass. Give yourself a fair evaluation and then make a plan. You can start with the simplest support/resistance trading system you can find, and put my words to the test. You don’t need anything else except a plan and the discipline to stick to it, through the wins and through the losses.

Have a wonderful day.

Jennifer

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  • Gabor

    Hi Jennifer,
    I like this post very much. I actually get irritated by the people you talk about. The ones that can only talk about gigantic wins… It is unbeliavable how high expectations are put when it comes to trading. And how irrealistic these expectations are. What you talk about here is key. I am not there yet, but hoping to be on this path. I am still being distracted many times. Working on it…

    Cheers,
    Gabor

  • http://www.sofmarfx.com/ Hernán Urán

    Hola, comparto la idea. Sinceramente no conozco a un solo trader que pueda generar ingresos constantes de un 30% mensual. Matemáticamente es posible, pero me gustaria ver su plan de contingencias.
    Siempre me quedo con una frase de un mentor “Hernán, tenes una maquina de hacer dinero, no la sobrecargues”

    Cordial saludo,

    Hernán Urán

  • http://www.goldenwire.com Ramsi

    Jennifer,

    Nice post. What you said about random gains and losses was incredibly important. I believe random wins are even more dangerous to novice traders than random losses, because that’s when the overconfident “trading is easy” attitude kicks-in and they start projecting gains into the future (in a linear-fashion).
    Respect to what you do to support your family and all the best in your trading.

    Ramsi

  • Albert

    Hi Jennifer,

    Really nice post… awesome words.

    Regards,

    Albert

  • Rick

    I have traded at a few different times and have wiped out accounts more than once trading randomly. Thank you for drawing attention to the fact that trading is about ones ability to control their own emotions and expectations. The best way to keep emotions at bay is true money management no matter what the strategy is. Money management with strict guidelines is the simplest sense of removing emotion, point being when each trade has so little at risk per account size, then and only than can you remove emotion. Picking tops was a very bad habit of mine, but worse than that was the risk I had on each top picking attempt. By the time I finally picked the top, I would be out of ammo. Really sucks to finally be right on a top & say see I told you so because you no longer have the resources to enjoy the ride. G/L trading to all. Thanx Jen.

  • pipstar

    Only professional money can move markets.

    Learn to recognize when they get in and get out.

    Add support and resistance levels and you’re gold.

    Anyone who says that 30% a month is not doable is not doing what I mentioned above.

    Do that and 30% a week will be routine.

    Why wait in the market for 1,000 pip trades when you can make 1,000 pips in 2 weeks. WITH ZERO OVERNIGHT RISK.

    Again, if you think that’s hype and bs, you’re not doing what I mentioned above.

  • Mohammed Tanweer

    Hi jennifer, I don’t care where u live or where what u do or who you are. I know that uve spoken a truth for all there out there to show that it is possible and its not that hard. Ive hard a tough time in the start and ive learned that exact thing uve said. Its not about being something out of this world or some rocket scientist. Its all about being simple and sticking to it no matter what the markets do. Its about about believing in your self. I support you and keep up the good work. Im sure ull be very inspirational for people cuz uve sure been for me.

  • Roy D

    Amazing post Jen, and unfortunately it took me a long time to realize exactly what you mentioned. It does for all traders I believe, and I myself owe a lot of my success to Rob Booker as well; Not because he taught/sold me some “AMAZING SYSTEM!!” or how to trade the markets, but more importantly to look inside myself for the answers. I quickly started to realize that there was this internal dialogue I was ignoring every time I’d enter a trade. I finally started listening to it and realized it wasn’t even me who was trading but instead just a table player at Vegas. Until you start listening to yourself, instead of all the noise out there and start holding you and only YOU accountable for your every action, it will simply be a ~garbage in – garbage out~ trading game. Thanks Jen, and Rob!

  • Ken Carpenter

    Agreed! Very nice article, I sent it to my followers.

  • http://twitter.com/robbooker robbooker

    Ramsi, I’ve been doing this for 10+ years now and I struggle with it nearly every day: Am I going to be the random crazy-ass trader guy, or am I going to be the determined, focused trader I know I can be? Anyone who says they don’t fight that battle every day isn’t telling the truth.

    Nice to hear from you on the blog. Thanks for reading!

  • http://twitter.com/MengFong Meng Fong

    Hi Jennifer,

    This is awesome….thanks for this.

    Meng

  • Anonymous

    Hi, Meng!

    - rob

  • Nigel

    Great post! “Dont do as I do, do as the market tells you”

  • Tyler

    Thank you Jennifer,
    I just printed your post out and will read it every day for the next month.
    Tyler

  • Nazaar

    Thanks for writing this well articulated article. I have read it several times and plan to read it again.

  • Ldolu10361

    well said

  • Nagasapi

    Disculpe, si usted puede demostrarme que genera un 30% de utilidades en un mes, durante por lo menos un año, cierro mi compañia y le doy todo mi capital

  • http://www.facebook.com/george.gasco George Gasco

    for the benefit of the spanishly chalenged…
    ” Excuse me, if you can prove to me you can generate 30% a month for at least a year, I will cllose down my business and give you all my capital”
    LOL…don’t do that!

  • CJ

    Motivating article…what a “wake up call” !

    CJ

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