The First Step to Trading Success

as a trader and especially a new trader there are thousands of courses you can take in thousands of books you can read and gain that knowledge but how do you also gain skills that you need to trade our guest today is Mike Bela fury here to talk about that so Mike what do you mean in the differences between just knowledge of the markets an actual trading skill I was actually just having breakfast with Corey rosenbloom from afraid to trade and we were talking a long time about this so Corey will come and he'll give a presentation about a particular pattern or I'll come and I'll give a presentation about a particular pattern which I'm going to do and let's just call that a flag pattern a technical flag pattern which a lot of people know so people will sit there in the audience and they'll listen and I'm sure they'll be highly entertained as I'll sprinkle in some nice stories and so now what they've gained is domain knowledge they've learned a set up but that's just the beginning of the learning you can't walk out of the presentation that I give and start shooting away on your merit rate account and think that you're gonna be able to retire to a Caribbean country in a couple of months that's not going to happen you got to add intrinsic motivation which means you can have to stay late and do a lot of practice you got to add critical feedback it's a great book bounce from a really top-level ping-pong player who studied how people became great at things and he couldn't actually find really terrific examples of people who were leap performers which is what traders are there are leap performers guys as traders who didn't have excellent coaching you know you got your Coach K's for a reason you got your Bobby Knights for a reason you got your Rick Carlisle's now that we're in Dallas for a reason you got to add also purposeful practice to that and Gladwell wrote a little bit about that and Dan Coyle writes about that and you know Anders Ericsson is really the grandfather of all of that and that's really how you become great at anything I know that tweeters have a easy time seeing the pattern after the fact of course everybody sees a beautiful head and shoulders or the flag pattern the trut the tough part of course is reading the right side of the chart before it prints is there anything you can do to kind of take that knowledge of knowing what that pattern looks like but see it while it's happening which is really tough to trader now there isn't and that's what all right so you learn the pattern okay that's the main knowledge then you actually have to go through the learning curve you've got to put your time and you've got to practice and what happens when you practice the right way is that you're gaining intuition I talked about something called combinatorial explosion I talked about a simple flag pattern every flag pattern is different because there's a thousand variables that are going into each trait how do you tweak each flag pattern how do you know when to really size up in it you can't trade every flag pattern the same that makes no sense what about a flag pattern when the market is exploding to the upside versus a flag pattern where the market is exploding to the downside that's just one variable you got to trade that completely differently and so you know what you really need to do is practice in the right way you're going to build intuition so that when you're trading you actually know how to make the adjustments and for an experienced trader a lot of times you can't even verbalize that we'll sit and talk with our traders and we'll watch film back of a particular trade and I'll be like you really need it to short that stock at the top of the range not the bottom why I'm not really sure you know I but I've been doing this for a long period of time and I just know that's the real thing to do and under you're a big proponent of videotaping all your trades so you can go back and look almost like a football player does and your game is that what you mean by practicing right that's one of the one of the things you can do to practice but you can journal all right you can talk to other traders you can talk to your mentor you can watch film back yourself you can watch FAQ film back in a group okay you can create your own study gaggles of people to talk through trades we're doing something interesting right now we're building something called the SME playbook guys will send me a trade that's their best trade from the day and they document it in a template form they sent it to us and we put it into our training program in this section and you can get more reps that way right you can watch your tray at her tray at his trade and we can we can get a lot better at that flag pattern it sounds like you've you've kind of really put a very objective way to achieve these steps it sounds like you can make it it's not some nebulous thing that you use someday it'll just click for you there are steps to take no there are the problem is is that to be clear most people are never going to take those steps those people are really never gonna commit to really creating a craft it's a craft and you know LeBron James as much as he's physically talented still has put in a lot of work Kobe Bryant you know it's a great anecdote about him about how he wasn't satisfied with a particular game and he spent three hours shooting at a road site and the security guards are like can we go home you know so there's there really is a code for a traitor and I talk a lot this about this a lot to becoming better and the question is do you have the intrinsic motivation you have the ability to sustain your energy to do that every day over eight months so that you can build a playbook and build intuition to be able to consistently make money in the markets like thanks for being here thank you Tom you're watching the money show com video network

Channel: MoneyShow

Views: 11,475

Rating: 4.9219513 out of 5

Keywords: the traders expo, traders expo, trading expo, etradingexpo, moneyshow, moneyshow.com

Id: WPOsB5loZ6I

Length: 5min 16sec (316 seconds)

Published: Thu Oct 13 2011