Ultimate Trading System

Lesson 1

Define Why You Want to Become a Trader
Ask yourself – Why do you want to become a trader?
Profitable trading is the perfect part time business. It is capitalism's best kept secret.
The market makes no distinction about your wealth, education level, ethnic background or any other aspect of your identity. Office politics, difficult bosses and tricky employees do not play a part in trading.

You can trade from anywhere.
Follow the few simple rules, and you can run your business as you see fit. Trading is the "perfect business".Of course, if trading successfully were easy, everyone would be reaping the profits. The truth is most people that trade will lose money. This is a fact for a number of reasons. Of all of them the primary cause of so many people losing money when trading is that they simply do not know how to trade.

If you do not know to trade, that does not mean that you are not smart. On the contrary, there are many highly intelligent people who lose millions of dollars in the market. If you do not know how to trade, there is usually a simple explanation: you do not have a coach or a system. Don’t let this deter you. Most people never master trading because it seems difficult to win and they seldom have access to an experienced, successful trader or trading methodology that actually works. Trading successfully is difficult if you do not know what you are doing.

You must be willing to drop any pre-conceived notions you have about trading, unlearn bad habits, and develop the discipline required to trade successfully and consistently. Are you willing to do this? Wonderful – now, you can realize your lifelong dreams. Close your eyes and visualize what being a successful trader means to you; see yourself making trades and trading profitably. Feel the great and relaxed feelings of having extra money in your bank account. This visualization exercise will help you formulate a solid, worthy, personal goal and keep you motivated and focused through this e-book.

Your first assignment is to write out one primary goal for your trading plan!
Take that goal and write it on a 3 x 5 card and put it where you will see it when you wake up in the morning and before you go to sleep each night. If you really want to burn this goal into your subconscious mind you should read it aloud once each morning and evening.
This technique really works. It is not "corny". This is a key technique Napoleon Hill teaches in "Think and Grow Rich"; the class success book teaches how to turn your thoughts into riches.

Lesson 2
What Separates Good Traders from the Bad Ones?
The difference lies within your psychology. Your psychological mindset is likely to play a larger role in your trading career than your chosen technique or any other details associated with your day-to-day practice.

What exactly is your psychology?
In short, your psychology refers to your emotional responses to a given situation…In trading, fear, greed, vanity, pride, hope, jealousy, denial - all these can affect investment decisions. Although your aim in the market is to maximize your profit and minimize your risk, emotions often make this easier said than done. For example, traders who react emotionally, make the wrong decision – such as the common mistake of holding a losing position in the belief that someday it will become a winner.

This classic mistake is called loss aversion. Loss aversion refers to the tendency for people to strongly prefer avoiding losses than acquiring gains. Some studies suggest that losses are as much as twice as psychologically powerful than gains. Loss aversion compels most traders to hold a losing stock while it plummets downward.
This clouded judgment clearly contradicts the trading adage "cut your losses."
The truth of the matter is, without controlling your emotions, most new traders lose all their money very quickly in the markets. In fact, most are completely wiped out within the first year of trading. So, as you can see, your emotions do play a big part in determining whether you fail or succeed……..

How can you reduce the effects of emotion & negative psychology?
The answer is discipline – without it you will lose.
The key message about discipline is that without it you will lose. It is that simple.
Can Discipline Be Learnt?

Source : beatforex.web44.net