Dec 11, 2017

Trading Psychology 2.0: Annotated Quotes (Part 7)

Here’s part 7 of my review of Brett’s book, Trading Psychology 2.0:

"Over the long run, you cannot succeed as a trader or investor if you do not evolve with markets."

I have discovered a few trading edges that stand the test of time but most trading edges come and go, they are only valid and profitable for a period of time. That is why having a backlog of tested trading ideas is so important. You may have to stop playing certain trading setups or patterns as they cease to be profitable and start trading newer edges. 


"Skilled traders I have worked with have similarly been different traders in different markets."

Not every successful trader but most. One good example of this is found by reading the Market Wizards book. Many of those traders have evolved their methodologies and are now trading in completely different ways as we now have completely different markets. But for example a successful eMini S&P futures scalper will always be a scalper and he may not need to make any meaningful changes to his approach. 


"Discipline is great for doing more of what works. When the status quo no longer works, however, adaptability becomes the new discipline."

You need discipline to follow your current set of rules. But if after a meticulous debriefing of your trading performance you conclude that your method is no longer working you need the flexibility to create a new set of rules and then switch to the discipline mode again.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Nov 27, 2017

Gambler vs. Elite Performer

"Most traders assume that they are competitive because they like making money. Gamblers like making money also, but that those not make them elite performers."

In Trading Psychology 2.0, Dr. Brett Steenbarger highlights a very important point, something that I also found by myself many years ago. The most successful traders don't only have a passion for trading when the markets are open and ticking. They are also very engaged in researching the markets looking for distinct trading edges, in risk management and on performance review. Brett even goes a step forward and tries to quantify how to separate the "gambler" from the "elite performer":

"The ratio of time spent preparing for trading and working on improving trading relative to the amount of time actually spent actually watching screens and trading is a very powerful metric for engagement."

Now it's time for you to evaluate yourself. In your recent behavior are you resembling a gambler or a elite performer?

PS: Trading Course is now available both in Paperback and Kindle eBook. Buy it now on Amazon!



You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões


Nov 21, 2017

Trading Psychology 2.0: Annotated Quotes (Part 6)

Here's a few excerpts from Chapter 2 - Best Processes #2: Building on Strengths complemented with my personal notes (check Part 1 to 5 on earlier entries on the blog):

"There's nothing more important to your development as a trader than studying multiple markets and trading styles, testing them out on paper, and follow you talents, skills, and interests."

After traders acquire a bit of trading experience they will begin to sense what "feels" right to them, what suits them best. The right trading style, the one that maximizes a trader's strengths should start to get more and more obvious as he experiments a few different trading instruments, time horizons and styles (for example mean reverting versus momentum).

In my case, I started as a discretionary swing trader in stocks (back in 1999) and found my definitive niche a few years later in systematic futures trading. In between, I tried macro investing, theme investing and sector analysis. It takes time to discover what really works for you.

"Perhaps no environmental variable is as important to accessing your strengths as our close relationships. I function best in a very stable emotional environment (...) I can sustain a high degree of intellectual interest and curiosity, but not if I'm emotionally distracted. If I were in an unstable romantic or family relationship, my performance would drop precipitously."

Ask yourself, are you in a stable emotional environment that is conducive to peak performance? To succeed in trading you must also have a stable, joyful personal life.


You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões




The Art and Science of Technical Analysis: Annotated Quotes (Part 1)

Another one of my favorite books is The Art and Science of Technical Analysis written by Adam Grimes. Readers really enjoyed the annonated quotes segments that I did on Trading Psychology 2.0 (Brett Steenbarger) and my plan is to expand that work to other great books. 

I'm starting this segment with two really great quotes from Adam's book, 

"When it comes to chart setup, there is no right way (...) Everything I do comes from an emphasis on clarity and consistency. Clean charts put the focus where it belongs: on the price bars (...)"

(1) Traders should not be filling their charts with multiple indicators and lines. This is the emphasis on clarity.

(2) Traders must be looking to the same chart templates over and over again. Find the right template for you (timeframe, bars or candlesticks, colors, indicators) and just stick to it. That is how you will train your eyes to process the data. This is the emphasis on consistency.

"Most small traders can be opportunistic."

In Trading Course: How to Become a Consistently Winning Trader I showcased a simple trading system to be explored in stocks using a one-day holding period. This type of very short-term techniques are not suited for big institutional investors because they cannot easily move in and out of the trading positions due to their large volume but they can be exploited to profits by independent traders.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Nov 20, 2017

Trading Psychology 2.0: Annotated Quotes (Part 5)

Trading Psychology 2.0 is getting more and more interesting as I dig deeper into it. Brett has done an incredible job writing this trading psychology book. This is part 5 of the my annonated quotes series:

"An important part of his edge was not trading when he perceived no advantage in the marketplace."

Great traders only strike when their edge is present and active. Many of the great traders have a sniper's mindset. You should too.

"Even when we possess a distinct and consistent edge in the markets, the paths to our profitability can be highly variable. Over the long haul - 100 or more trades - an edge tends to be apparent (...) Over the course of any series of, say, 10 to 20 trades, there are random series of winning and losing bets that can play havoc with our psyches."

You must learn to let go of the temptation to feel as good or as bad as your last three trades went. Learn to analyse your trading over a series of trades (25 to 50 may be enough, depending on the type of trading strategy).

"Tracking your edge is relatively easy when you place several trades per day."

This is one of the many reasons that I chose systematic intraday trading as my trading style. Not only am I able to play my trading edge more often, as its relatively easier to spot any deterioration of the trading edge and consequently realign my trading.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Nov 18, 2017

Trading Psychology 2.0: Annotated Quotes (Part 4)

These segments have been so well received by my readers and followers that I plan to keep dissecting other books and podcasts on this blog going forward. Today I will add a few more annotated quotes from Steenbarger's Trading Psychology 2.0:

"Successful traders I've known work as hard on themselves as on markets. They develop routines for keeping themselves in ideal states for making trading decisions, often by optimizing their lives outside of markets."

The best way to get better at trading the markets is to get better at everything you do in your life and just let trading rise with the tide. In order for your trading to work for you, everything must be in harmony. You must keep yourself in a optimal mental, physical, emotional and spiritual condition.

"Success is not to be found in being either a momentum or a mean-reversion trader; perennial bulls and bears eventually meet with grief."

One of the core messages of this book is that successful traders mutate when they need to. If you think about Jesse Livermore, Nicolas Darvas, Linda Raschke, Marty Schwartz what did they have in common when they were trading at their peak? They were doing things that fitted the markets that they were trading. As I wrote in my book, Trading Course: How to Become a Consistently Winning Trader, "Every great trader who has ever lived has developed his or her approach by adequately using certain market techniques that apply to a particular market at a particular time. One commonality among all successful traders is that they are in synch with the markets."

"How much time do we typically waste as traders, staring unthinkingly at screens, chatting with people who offer little insight, and reading low-priority/information-poor emails and reports?"

Time is a limited resource and so you must use it wisely. Don't just stare at prices without at least taking notes on patterns. Don`t read "junk" market related info by prioritizing and filtering all the market related information that you consume daily. Think of it as a diet. Eat just the healthy stuff.

"A pharmaceutical firm knows that best-selling drugs will eventually go off-patent and conducts the  research to find the next blockbusters."

As a trader you must have a similar approach to your business. While your current trading edges may be working just fine, you must be always preparing, developing new sources of trading edges. In the way I structure my trading, I spend about two hours each week day looking for new ideas, testing market related ideas plus one extra hour reading high quality trading related material (blog posts, trading podcasts, trading books) looking to spark the creativity that will lead me to new ideas to test.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Nov 17, 2017

Trading Psychology 2.0: Annotated Quotes (Part 3)

As you know, I'm currently reading Trading Psychology 2.0. I have been sharing annonated quotes (check the past blog entries) and I have two more interesting trading thoughts to share:

"I have never known an extraordinary successful trader who was not extraordinarily original in his or her approach to markets."

In my book, Trading Course: How to Become a Consistently Winning Trader I wrote, "A very successful trader once said there is always a way to make money, regardless of market or time frame. As a trader, your job is to find it. This structured course has that end in mind and will help you become a consistent, winning trader with a distinctive trading signature."  

In order to win, you have to own your edge. Because when things get tough you need to have the confidence to get going, to place the 5th trade after the last four lost money. That confidence can only come from your work. 

"The elite performers generate better ideas because they generate so many ideas."

This quote reminds me of the famous Thomas Edison answer to a journalist questioning him about his light bulb project: "I have not failed 700 times. I have not failed once. I have succeeded in proving that those 700 ways will not work. When I have eliminated the ways that will not work, I will find the way that will work."

Traders are also much more likely to find a tradable edge if they test as many ideas as they can.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Trading Psychology 2.0: Annotated Quotes (Part 2)

As I wrote yesterday, I'm currently reading and dissecting Steenbarger's Trading Psychology 2.0. Yesterday I shared four annotated quotes and today I'm adding just one:

"It takes a good trader to create success, a great one to recreate it."

Most trading edges are perishable, they do not last forever as the markets are constantly evolving and changing. Once a trader finds a profitable edge and he is able to explore it for a long time, it is extremely difficult to first, acknowledge that the edge is no longer present and active, and second, to get back to the number crushing work trying to refine or create a brand new trading edge. But it must be done to assure the continuation of a trader's success. 

Think about the Market Wizards books. Those traders evolved, they are not trading the same trading strategies that they mentioned at the time they were interviewed. Some were able to rebrand themselves through the discovery of new trading edges, others were not and left the business.

Over the next few days I will keep sharing a few quotes from this book. Stay tuned!

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Nov 16, 2017

Trading Psychology 2.0: Annotated Quotes (Part 1)

I'm currently reading Steenbarger's Trading Psychology 2.0. Over the next few posts I will share some of my favorite quotes from the book complemented with my personal notes:

"A primary goal of trading psychology is self-coaching."

Every great trader is also a master in trading psychology. A trader must study the markets in order to find a trabable edge and at the same time master trading psychology in order to acquire the mental skills that are needed to flawlessly execute any trading strategy, overcome a drawdown or not letting the daily P&L fluctuations affect a trader's personal life.

"Discipline does not substitute for skill, talent, and insight."

Yes, the hard truth is that you need them all in order to consistently take money out of the markets: discipline, skill, talent and insight.

"Successful efforts to master markets lead us down paths of self-mastery."

I wrote in my book, if you organize yourself, you organize your trading. But the reverse is also true. As you develop your trading mastery you will become more productive in many areas of your life.

"It's not enough to find an edge in financial markets; as any tech entrepreneur can attest, competitive advantages are perishable commodities."

Well, not every market edge is perishable as I have found trading edges that have been profitable for many years and in different market conditions. But as most trading edges come and go, traders must always be looking for new trading edges and monitoring the ones they are trading very closely in order to detect signs of permanent deterioration of the edge's statistics (average profit per trade, opportunity, percentage of winners).

It would be an interesting exercise if you also wrote your personal notes on one or a few quotes that are of particular interest to you and share your work with other readers in the comments section.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Oct 18, 2017

5 Great Quotes From Jack D. Schwager

Here's a list of some of Jack Schwager's most memorable quotes about trading: 

"Patience is important not only in waiting for the right trades, but also in staying with trades that are working."

"One of the cardinal rules of trading is: Don’t trade when you can’t afford to lose. In fact, there are few more certain ways of guaranteeing that you will lose than by trading money you can’t afford to lose."

"Just because you missed the first major portion of a new trend, do not let that keep you from trading with that trend."

"Never double up near the original trade entry point after having been ahead. Often, the fact that the market has completely retraced is a negative sign for the trade."

 "What winning traders share: they all understand that losing is part of the game, and they have all learned to lose." 



You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Oct 4, 2017

Watching The Markets & Taking Notes

I have the habit of taking handwritten notes about the market on my trading journal. Interestingly enough, yesterday I listened to a podcast with Jim Kwik (the founder of Kwik Learning and a widely recognized world expert in speed-reading, memory improvement, brain performance, and accelerated learning was interviewed recently by James Altucher, Ep. 254 of the James Altucher Show) and he mentioned how taking notes by hand strengthens learning. 

Taking handwritten notes not only helps with focus but according to a university study mentioned by Kwik on the podcast, students show both higher levels of understanding and retention. I knew this from personal experience and Kwik just reinforced my conviction with a little bit of science.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Sep 11, 2017

Don`t Think About The Money

"Finding the good trade means shutting down the ego, emptying the mind, and becoming receptive to insight. If you are actively *trying* to make money and thinking about how much you're making or losing, you fill your mind with outcome-thinking, which crowds out the process focus."
- Dr. Brett Steenbarger (in Trader Feed)


If you have any attachment to money—and who doesn’t?—it is very tough to trade correctly. This is one of the lesser-known secrets about trading success. When you are trading, you shouldn’t be thinking about the money. You should be thinking in point terms, as if you were playing a game. Of course, that must come after you’ve designed a business plan and put strict risk-management rules in place, such as not risking more than 1 percent of your capital in a single trade. But when you are trading, executing your trades, and watching the market, you should be thinking only in market terms, not in money terms. You should say to yourself, “I am up twelve points on this stock,” and not, “I have a profit of twelve hundred dollars on this trade.” Try that approach, and your trading surely will benefit.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Jul 19, 2017

William O’Neill: What Makes a Good Stock

“My philosophy is that all stocks are bad. There are no good stocks unless they go up in price. If they go down instead, you have to cut your losses fast.” - William O’Neill, founder of the Investor’s Daily

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Jul 6, 2017

Where I’m Seeing The Greatest Success Among Individual Traders

"Where I am seeing the greatest success of individual traders is in niche strategies and markets, where inefficiencies are most likely to be present."

- Dr. Brett Steenbarger, trader and performance coach



"When you try different styles, different time frames, and different asset classes, you will reach your niche, finding both the time frame and trading instrument that best fit you. It’s a long journey for many, but it is surely a very rewarding one. It takes time to learn trading, but it takes a little more time to reconcile that trading knowledge with who you are."

Find a trading niche (day trading Apple (AAPL) using a specific trading pattern just to give you an example) and become an expert in it. That is where you are most likely to find your sucess.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

May 29, 2017

When You Need A Trade To Work Out

"When we need for a trade to work out we set ourselves up for disappointment. Our job is to trade with the odds and accept the probabilities that the odds may not play out on any particular occasion."

Brett Steenbarger, performance coach


Most traders focus too much on the outcome of the trade they are currently in. This is a big mistake and the source of most unnecessary trading losses.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões






May 22, 2017

Should You Set Monetary Goals In Your Trading?

I am not a fan of setting monetary goals in your trading. Why?

First of all, one of the problems with setting a fixed monetary goal is that you may become so concerned about the outcome of your trades that it will start interfering with your process, making you cut short some trades to grab a quick profit for example.

Second, one of the tricks of being a consistent winning trader with a carefree state of mind is exactly not to think about the money when you are trading.

A third point against setting a fixed monetary goal for your trading session, week or month is that your particular method, strategy or system will work better in some market environments than in others. So, you should expect that variance to show up in your P&L. A P&L that shows variance is not really compatible with fixed monetary targets.

PS: Trading Course is now available both in Paperback and Kindle eBook. Buy it now on Amazon!



You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões



May 5, 2017

Losing Streaks

Having a trading edge does not mean you won’t have losing streaks. This is another very important point: Even if you have a winning methodology, you can be exposed to a big streak of losing trades. As every moment in the market is unique, just because you had two, three, or five losses in a row, it does not mean your next trade will be a winner. Consider this next example: 

It’s been said the longest recorded streak of one color in roulette in casino history happened in 1943, when red won thirty-two times in a row. The gambler’s fallacy is that after such a streak of red, black is more likely to hit on the next roll—it’s not. 

Even the most successful systems need to have rigid risk-management guidelines in order to avoid the risk of ruin after a bad sequence of trades. Having an edge does not mean the edge will work in small samples; actually, there will be periods when even the best of trading edges will show a few consecutive trading losses. Bear that in mind.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões


Apr 25, 2017

Why Developing Traders Should Not Think About Quitting



This post was inspired by a recent interaction with a reader of my book. 

Traders must embrace the growth mindset and not feel tempted to quit after early failure. The learning curve in the trading business is long (5 to 10 years) and traders must be focused on constant improvement and not in a "hit or miss" kind of mission.



You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Apr 6, 2017

Markets Are Always Changing

“Markets are always changing and even the most talented participants have to evolve with the markets and that need to evolve itself brings its own psychological challenges. The need to be creative, the need to be resilient in the face of frustrations and also the need to identify and build upon strengths.” 
– Brett Steenbarger in Chat with Traders podcast


As an old adage says, “There’s no such thing as the goose that lays the golden egg forever.” Market conditions do change. One of the real skills for a systematic trader is to understand when he or she needs to change a trading system or its parameters, adapting it—or even when to abandon it altogether and develop a new one. Traders work very hard to find a trading edge that works, and they’ll play it out until it stops working. 

But they must be prepared for, and even expect, the market to change, and they must know that this unavoidable change may reduce or eliminate their trading edge. That is why it’s so important to look for new ideas all the time and to always be testing new systems and patterns—doing so means you’ll have a backlog of trading edges to work with if or when your current one loses efficiency or stops working.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Apr 4, 2017

Finding Your Trading Niche (Linda Raschke, Assad Tannous, Steve Burns)

A trader must make the effort to master a very specific type of trading method or trading vehicle. Specialize—do not be a jack-of-all-trades, master of none:


"All you need is one pattern to make a living."
- Linda Raschke, futures trader, LBR Group


"You want to get in the habit of making the same trades over and over again."
- Tracy, independent crude oil futures trader


"Successful traders focus on what they are doing with an unconditional belief. Everything outside of that is just noise."
- Assad Tannous, Head Trader and founder of Asenna Capital


"A trader that chooses to be master a specific type of trading method or trading vehicles has a much better chance of success than the traders that just dabble in many different things and never make much progress."
– Steve Burns, swing trader and author


PS: Trading Course is now available both in Paperback and Kindle eBook. Buy it now on Amazon!



You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Apr 3, 2017

How To Think About Trading Losses

"Even the most successful traders encounter their periods of loss. How they manage the losses — and how they manage themselves during the periods of loss - makes a huge difference in terms of their ability to come back."
—Brett Steenbarger, author of Trading Psychology 2.0


"Most studies suggest that losses are twice as powerful, psychologically, as gains."
—Daniel Kahneman, author of Thinking, Fast and Slow


"What winning traders share: they all understand that losing is part of the game, and they have all learned to lose."
—Jack D. Schwager, author of Market Wizards


When traders are in a trade, they tend to narrow their focus. The only thing a trader tends to think about is the outcome of the trade he or she is in right now. This is especially true if the trade is losing money. The trader’s instincts will try everything to keep that trade from being a loser. The trader may add up, average down the trade, temporarily remove the stop, widen the stop, or just stay away from the price action for a couple of days to give the trade some room to breathe. I have seen all these tricks among traders, both novice and experienced. But traders should not be worried about losing money. You win some; you lose some. It’s the bottom line that counts. 

Traders may lose money, but what they cannot lose is their trading discipline, as it is one of the fundamental assets of any trader. All traders must have confidence in themselves. All traders must believe in the deepest sense that they will do what is best for their own interest all the time, and that is to play according to the predefined plan.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

Mar 31, 2017

Always Respect The Market (Tony Saliba, Linda Raschke and Mark Minervini)

Three super traders share a very similar market belief - you have to respect the market or face the consequences (a severe drawdown, emotional trauma and a depletion of your trading confidence):

“Always respect the market place. Never take anything for granted. Do your homewaork. Recap the day. Figure out what you did right and what you did wrong.” 
– Tony Saliba, options trader 

"The market is seductive and brutal to those who are weak and undisciplined. There is no alternative to patience and discipline."
– Mark Minervini, momentum stocks trader

"Don`t be overly aggressive with the market. Treat it gently by allowing your equity to grow steadily rahter than in bursts.” 
– Linda Bradford Raschke, independent trader

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Doing a Daily Debriefing of the Trading Session

Successful traders know that a consistent and systematic review of their daily trading activities is the direct path to growing and improving. After the market closes, I like to take half an hour to debrief my trading session.

These are the questions I ask myself and answer in my trading journal:

➢ How many trades did I take?
➢ Did I make any trading mistakes?
➢ How many points or ticks did I take out of the market?
➢ Did I spot any new trading pattern interesting enough to study further?
➢ How was my energy level?
➢ Did I drink enough water during the day?
➢ Did I exercise today?
➢ Did I learn anything new?
➢ Did I find some interesting articles to read later?
➢ Did I come across an interesting trading podcast or book?

The best way to improve your trading is to build on what you have already. An incremental improvement each day will make the difference in the medium and long run.

Besides doing a daily debrief of your trading, you must do a more in-depth review of your trading at the end of the month. What is working well in your trading? What adjustments do you need to make going forward?

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Mar 29, 2017

BlackRock Goes "All-In" On Systematic Trading

"After years of deliberations, Mr. Fink (CEO of BlackRock) has opted for the promise of the machine. On Tuesday, BlackRock laid out an ambitious plan to consolidate a large number of actively managed mutual funds with peers that rely more on algorithms and models to pick stocks." (in New York Times, March 28th 2017)


Most People Make a Big Deal out of Market Prediction 

The most successful traders do not predict markets—they leave that for financial commentators, economists, and analysts. Consistently winning traders follow the signals generated by their systems, strategies, or methodologies. They get out when their stops are hit or their trading edge is no longer present or active. They do not take profits before their methods tell them to. Successful traders also look for many opportunities to exploit their trading edge; this makes them less likely to experience losing months in their accounts. Most traders do not understand this line of thought. As a result, they try to predict the market direction and fail to achieve the desired trading consistency.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões


Mar 27, 2017

Momentum Day Traders

"The more momentum type traders are going way. The guys buying and selling very quickly, the black boxes have taken over that area. If you are a trader trying that, start changing your style into a little bit of a longer term outlook. It could even be a 2-hour outlook versus buying and selling quickly in 3 minutes."

Sean Hendelman, CEO of T3 Companies


Changing Market Conditions 

As an old adage says, “There’s no such thing as the goose that lays the golden egg forever.” Market conditions do change. One of the real skills for a systematic trader is to understand when he or she needs to change a trading system or its parameters, adapting it—or even when to abandon it altogether and develop a new one. 

Traders work very hard to find a trading edge that works, and they’ll play it out until it stops working. But they must be prepared for, and even expect, the market to change, and they must know that this unavoidable change may reduce or eliminate their trading edge. That is why it’s so important to look for new ideas all the time and to always be testing new systems and patterns—doing so means you’ll have a backlog of trading edges to work with if or when your current one loses efficiency or stops working. 

One strategy I find useful is to compare the short-run metrics to the long-run metrics to measure a system’s health in terms of profitability. This is one of my favorite trading practices. I am always comparing the short-term performance, distribution of trades, and risk metrics of my trading systems to their long-term metrics. I want them to be as constant as possible, because in trading, you do not need a large edge to run a successful trading business—you need, instead, to have a consistent edge. 

I like to compare the year-to-date metrics (average tick per trade, total dollar win) with the metrics over the last three months and over the last month. What I do is look for evidence of significant deterioration in a particular system. If a system deteriorates too much, I will stop using it until its performance is back in line with its historical data—that is, if it ever recovers those metrics, because often a system’s deterioration is not temporary. 

Be aware that the market may change from time to time and that you may need to adjust your trading edge accordingly or even develop a new one. Charles Darwin said it’s not the strongest or the most intelligent who survive; it’s those who can best manage change. This is very relevant for trading, as the need to always be in sync with what the market is doing implies an openness to change.


You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Mar 22, 2017

Using Volatility as a Trend Filter

What can volatility per se tell you about the current state of the market? When markets start to have big down days, big up days, and a lot of dramatic intraday reversals, it is likely we are in a down trend. A bull market tends to be smooth, slow-paced, and even boring, while bear markets or corrections are emotional and volatile.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Mar 17, 2017

Real Trading Example (British Pound Futures)

I recently tested a system on the British pound futures, and while it had a winning rate of 57 percent and an average win similar to the average loss, it gained on average only 2.8 ticks per trade. Considering the commission on that contract, the real edge was just 2.1 ticks per trade. With such a narrow edge, good execution is the key to winning money; a sloppy trader may even lose money using this strategy, due to its razor-thin edge.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões

Mar 8, 2017

Discretionary Traders (How to Know If There Is an Edge Present)

How do you know if you really have a trading edge if you are a discretionary trader? You can see it in the shape of your equity curve. If it shows some consistency of making money without large drawdowns, then over time you can begin to conclude that you have an edge. People who are very good at trading the markets have a high level of confidence, which is impossible to gain unless you have an edge. 

It’s something you have to feel and believe on your own. Unlike in systematic trading, where the metrics of a system prove the system’s edge, it is not something that is definitively provable. 

If you are able to make money with some consistency, with a good control of your losses, you get to the point where you feel you have an edge, and your equity curve confirms that. You cannot think you have an edge if you lose money for a long time—that is insane! 

Even discretionary traders need to have an edge, which does not exist without a methodology. In fact, I have never met anybody with an edge who does not have a very specific methodology.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões





Mar 2, 2017

Trading: Always Be Looking For New Ideas

Traders work very hard to find a trading edge that works, and they’ll play it out until it stops working. But they must be prepared for, and even expect, the market to change, and they must know that this unavoidable change may reduce or eliminate their trading edge. That is why it’s so important to look for new ideas all the time and to always be testing new systems and patterns—doing so means you’ll have a backlog of trading edges to work with if or when your current one loses efficiency or stops working.

You will follow practical steps and acquire the essential skills a successful trader must have in order to consistently win, and you'll also learn:

- how to develop a trading system
- how to utilize the best trading techniques within a trading methodology
- how to think about the psychological aspects of trading and the markets
- how vital it is to treat trading like a business

As you master this breakthrough program, you'll build yourself a distinctive trading signature.

"It took me five years to become a profitable trader and almost another five years to become extremely consistent. If I had come across the right trading material and concepts earlier, I’m sure the learning curve would have been far shorter. This practical book will give you the materials and concepts I wish I’d had early in my career." - Henrique M. Simões