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Andy Jordan Educator for Futures Trading Strategies on Spreads, Options, Swing/Day Trading, and Editor of Traders Notebook. You can read my bio by following this link.

Stressful Times

We are living in stressful times. However, In times of greatest economic stress, the worst thing you can do as a trader or investor is to panic. Reactions to situations that are born of fear are rarely wise or helpful. Perhaps you didn't sell before everyone else began to, and the market is in a slump. Now you’re facing a huge loss, all in one day. Your first thought may be to call your broker and...
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A typical Traders Notebook Outright Swing Trade

Today I want to show you a trade we had the other day with our new service. As you can see below, we were looking for a few entries in several markets. We were filled in the long Soybean Meal trade at 301.5 with an initial stop at 299.0 (the risk was $250 per contract traded). During the overnight session the market moved a bit, but everything was very quiet. At the open of the day session the mar...
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Five Basic Steps To Becoming A Successful Trader

1. Focus on trading vehicles, strategies, and time horizons that suit your personality 2. Identify non-random price behavior 3. Absolutely convince yourself that what you have found is statistically valid 4. Set up trading rules 5. Follow the rules 6. Don’t be afraid to abandon a rule that is no longer working.   In a nutshell, it all comes down to: Do your own thing (independence); And do th...
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Market Technicians

Market technicians tend to peer into market detail from the point of view of mathematics and statistics. A market technician will present you with something like: “There are only four range possibilities for a price bar for any chart time frame: The outside bar; the inside bar, the higher high and higher low, and the lower high and lower low. Using only the open, high, low, mid range, and close da...
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Markets tend to part the foolish from their money

Sometimes you feel that you are able to throw caution to the wind. That is when you must be careful to not spit into it. One satisfying aspect of trading can be identifying a market (or spread) that is undervalued, at support, trending, breaking out, or behaving seasonally – and then seeing it continue to behave as expected. When it does so, it pays to be aggressive – boldly assuming positions, an...
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Becoming a consistent winner

Many novice traders underestimate how long it takes to become consistently profitable. They assume they can trade profitably in a matter of months, whereas veteran traders will tell you that such consistently profitable trading may take several years. And it's difficult to achieve. It requires great effort and persistence to become a steady winner, yet many aspiring traders think only minimal effo...
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Learning from Mistakes

If you make mistakes during trading, go back in your mind to see what you could have done better, or differently. There is usually something to learn from each trade. For example, did you stay too long in a single trade? Did you trade too aggressively, or not aggressively enough? Should you have cashed in (or added) some contracts, but didn’t? Mistakes don’t matter much if you learn from them. Ana...
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Do I deserve to win?

The world's most successful traders believe in themselves and their ability to win. In fact, many of them feel that they “own” the market. They are not necessarily being arrogant, but they are sure of themselves and that they are able to take profits out of the market. Most important is they believe that they deserve to win. They have a mind-set that is conducive to winning as a trader. It's essen...
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What is the best way to enter or exit the spread trades?

I think there is no “best way” to enter or exit spread trades, there is only “your way”. Let me explain: I personally prefer the open and the close to enter all my spreads. I don’t like to watch my spreads during the day and I focus only on the closing price. Most buying and selling is at the open and at the close, especially in thin markets. When you use a limit order you can enter anytime you wa...
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Feeling Neutral

Some traders unconsciously ratchet their emotions up a notch each time they avoid a trade when the market is not in their favor. So their emotions build, like steam pressure, to higher and higher levels. You can see the anger growing in them. They feel that by patiently staying out of every trade that they are demonstrating superior trading skills, but they are not being rewarded for it. When we i...
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Is trading a clean way to earn money?

Many wannabe traders have trouble following their trading plans when they are seemingly in conflict with their basic beliefs. While you may have intended to stay with a strategy having specific parameters for entering and exiting a trade, there are things that can cause you to abandon your plan when you are faced with the reality of a live market. Sometimes this happens because you question whethe...
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Confidence

A few years ago I had an interesting conversation with Joe about “what makes a trader a successful trader”. We discussed this over several days because we wanted to find out how we can help struggling traders to enhance their trading. We finally came to the conclusion that “confidence” is what makes a huge difference. A trader can have a good system, good money and risk management in place, good u...
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Paying back borrowed money to the market

Have you ever changed a losing trade into a winning trade by ignoring your trading rules? I would guess almost every trader has done it at least once, and many do it regularly. The problem is, even if you made money on this single trade, the market will almost surely make you pay back your gains with high interest. Let me giving you an example.   Let’s assume you went long the Soybeans. Based...
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How to trade the mini/micro contracts!

I've received the following email from one of our Traders Notebook subscriber regarding the new Outright Futures trading ideas. I think it is VERY informative! Thank you Tom!!! "This new program sounds very interesting.  Here are a few thoughts about trading with the mini/micro contracts.  I would advise everyone to put up a chart of the full size contract side by side with one of the mi...
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Go to the Exchanges for the best basic Information

The exchanges all have some very basic information freely available. This even includes some trading strategies. There may be a small amount of hype in what they say, but generally, the information is good. The problem with information you get outside of the exchanges is all too often filled with false claims, slanted to whatever the person is selling. Traders are continually bombarded in magazine...
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Trading is not scientific

I say that because trading is not an exact science. You can't do X and get Y every time. Trading does not fit the definition of science. It is not totally objective. It is as much an art as it is anything else. There is no magic formula. Trading is all about probability. It is the art of correctly applying a set of carefully thought out rules and allocating the probability of that event to result ...
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Why so many traders "don’t make it".

Recent figures show that 90% of traders who ever trade lose their account and that 10% actually go bankrupt. Those are scary numbers, I’m sure you’d agree. Traders are not stupid people; most traders have an above average IQ and are above average in most categories such as education and income. I think they don’t make a success out of trading because t hey lack proper education and mentoring. By e...
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Over-Trading

Over-trading fits in under the topic of risk management. We are talking “risk control.” First, I would say that risk management is one of the most important things that you really need to understand. Second, you must begin to under-trade, under-trade, under-trade. Whatever you think your position ought to be, cut it at least in half. My experience with novice traders is that they trade 3 to 5 time...
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Learning from losses

Winners learn more from losses than from profits. When a profit is taken, there may be little room for improvement. When a loss is taken, a trader's self-discipline is the first thing to be examined. The second aspect of a loss is how did the actual price action cause the loss? Was there a trend reversal; an unexpected gap? Most beginning traders sustain losses due to emotional reactions. Traders ...
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Ego-less Trading

The majority of traders might think it would be impossible to trade in an "ego-less state", but this is not the case. To trade in an ego-less state means simply to not let the ego and emotions get involved. While trading in an ego-less state, winning or losing on a single trade become almost meaningless when the focus lies only on the whole picture. This is the soul of ego-less trading. Trading wi...
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Derivative transactions, including futures, are complex and carry a high degree of risk. They are intended for sophisticated investors and are not suitable for everyone. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results, and all of which can adversely affect actual trading results. For more information, see the Risk Disclosure Statement for Futures and Options.