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“An investment in knowledge pays the best interest.“
Benjamin Franklin
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Traders,
We are continuing yesterday’s topic about frustrations we face in our journey as traders as it relates to education and application. Today, we will focus on education. If this is an area you are struggling with, sometimes going back to the basics can do trick.
Mindset – Are you in this just to see how things go or are you here for the long haul? One is likely to bail out the moment things get hard because there was no real commitment when they got started. Have the mind that you will gain the knowledge and learn what you need to be a trader no matter what.
Set Proper Expectations – Allow yourself to be a student. No one expects a med student to become a doctor the moment they apply for med school. You are learning a new skill and as such it will take time before all the pieces start to make sense.
Figure out what it is you need to learn first like what trading instrument you will be trading between stocks, options, futures and forex. What type of trader will you be? Day, Swing, Position, or Investor? Eventually will you learn to be all at some point? The answer is yes but keep it simple and learn each type one at a time. We often feel the need to digest everything there is to know about trading in one setting and it’s impossible. There are things that we need to know and there are things that are nice to know. For example, when learning about fundamentals, as a swing trader you need to know that companies report earnings quarterly and how that might impact your trades if a stock gaps up or down. It is nice if you know about PE and PEG ratios but spending hours learning this as a swing trader is irrelevant. Your time is better served learning about indicators like moving averages. Basically, focus on swing trading mechanics such as identifying support and resistance levels. Pivots and momentum changes, candlestick patterns that easily recognizable. The time to deep dive into company PEG ratio, guidance, year over year revenue etc. will come when you are ready to deploy the investor mindset.
Chart of the Day
IWM Chart
Sometimes it is easier to recognize trends and patterns on a clean chart. From the low of $142.09 in September can you identify the levels of support IWM has formed during this recent uptrend? How about the slowing momentum?
Video of the day
Take a Walk
Traders Lounge 11 AM EST
Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.
Trading Lounge – Special Nightly Edition
We are holding a special nightly Trader’s Lounge tonight. We are excited to hold this special edition!
Halftime Report 12:30 PM EST
The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day and fun in a way that only Matt and Tim can deliver.
Trade Masters 7:00 pm EST
Join us for a special webinar with the coaches where they’ll analyze some trade setups.
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