Hello traders,
I hope life and the markets are treating you all well. We’ve had an interesting start to 2019 and I think it will only become more eventful as the year progresses. As always this will provide either a threat or an opportunity based upon attitude and preparedness.

For the last few years I have run the VTP trading sessions in London and
I am presently setting my schedule for the VTP trading sessions for 2019. As my diary gets compressed I am looking to deliver the various stages in 2 day blocks (apart from Stage 2 which is 3 Day) with follow-up online sessions. This also makes it easier for the attendees to manage their diary.
The VTP was originally set-up to help give Veterans an insight into trading financial markets using three principles that they naturally embrace:
– Process
– Discipline
– Self-Awareness

 
It just so happens that those very same traits are also seen in consistently successful traders. All traders can improve by embracing these traits into their trading. As the project has evolved it’s now my intention to create a wider community of  ‘Versatile Traders’  which I would define as:

• A Versatile Trader has the ability to trade any instrument, in any direction, on any time-frame.

Personally I think the days of someone just being solely a 5 min EURUSD trader are long gone – a good trader now needs to be able to operate where the best opportunity lies. That could be FX, Indices, Stocks, Commodities, Bonds or Crypto.

That’s not to say that a trader may not end up focussing on a particular style, asset class and timeframe as their experience increases, however they should have the ability to operate wherever the opportunity lies.

So with that in mind here are the dates for the VTP Stages 1-4 for 2019. They are delivered in a small group between 6-15. If you want to join a particular stage or to know more then drop me a line.
Stage 1: Introduction to trading and financial markets – 21st & 22nd February, London: LTN cost: £297

 
This is the ideal stand-alone introductory course to trading and financial markets. Over several sessions it provides the building blocks to be able to educate a new trader how to operate safely and effectively within financial markets. By the end of the stage the new trader will understand the 4M’s of Trading: Markets, Methods, Money & Myself. They also develop those three key traits mentioned at the beginning: Process, Discipline & Self-Awareness.
There is no requirement to take any further stages – this is a stand-alone stage that will provide anyone with the fundamental basics of successful trading.

 
Stage 2: An introduction to longer-term swing and position trading of FX, Indices and Commodities Markets – 21st & 22nd March, plus Thursday 16th May: LTN cost £397
Leading on from Stage 1, here we focus on longer term trading of FX, Indices and Commodity markets in-line with how I trade myself and for funds. We provide deeper insight into these markets and additional tactics to help build your own successful longer-term trading business.

 
Stage 3: An introduction to short-term, intra-day trading of FX & Indices markets – 18th & 19th July, London: LTN Cost: £397
As the name implies we focus on how to trade FX, European and US Indices from an intra-day basis. Sessions will be based on preparing for your day of intra-day trading of these markets and how to adapt the strategies, tactics and concepts from earlier Stages for intra-day success.

 
Stage 4: On Managing Myself, Trader Performance and becoming a Money Manager – 21st & 22nd November, London : LTN Cost: £397
This stage is split into 2 sections: Half on managing self and the other half on managing money – namely other peoples. You may or may not have dreams of becoming a money-manager however acting as if you are a fund manager is never a bad thing in your own trading business. This whole stage will be focused on what you need to do to build your own trading business that will put you in the right space to be able to seek funding (if that is your wish).

 
In total it will equate to about 72 hours of us working together over the course of the year. As always there is a cost involved. I am fortunate that I am allowed to use a corporate clients location so that enables me to keep costs to an acceptable level.
Stage 1 has always cost £297. The other stages normally cost £447 but for today if you wish to join one of the stages the cost is £397.
In total to attend all parts of the VTP next year would cost £1488. However for those that wish to attend all of the sessions this year then there is an early bird cost which is reduced to £1200 for the year. There will only be 12 slots free so it’ll be on a first-come, first-served basis, with veterans getting priority.
I wish you every success in your trading for 2019. As I said at the start this year can either be a threat or an opportunity for you – its about your attitude and being prepared.  Trade well!
Paul

Happy New Year to you all traders!

I trust you enjoyed the Christmas break and are all ready and primed for what will be an eventful 2019 in markets.

I thought Id start 2019 with a great piece of insight courtesy of one of my VTP clients. Ee Lyn is a promising trader who is progressing nicely towards consistently profitable  trading success. She is already managing funds and chipping away nicely.  I received an email from her last week updating me on her trading performance for December:

“Here are my trade results for the 2 weeks to year-end. I have kept my Gold trade open over the holiday period as it was in profit and I have been trailing the SL with the swing lows. Should have kept the last CADJPY trade going as well (I closed the trade manually) as my original target was W1 support at 80.50 (8R profit) and SL had been moved into profit prior to Christmas. The first CADJPY trade was entered on D1 chart, and the rest were adding to the position (entering on H1) when the SL for each subsequent position had already been moved to either break even or profit. I now see what you mean about adding to positions!!

CADJPY short +5R
CADJPY short +7R
Gold long still open
USDCHF short break even
US30 short +2.1R
AUDJPY short +5R
CADJPY short +5.4R
CADJPY short +3.7R
US30 short break even

I hope youd agree that’s a strong end to 2018. She’s posted a fine set of trading results and can take some personal and professional satisfaction in her performance.

I have for many years being mentoring folks that the way to make step-change in their equity curves is to look at riding their winning positions by adding to them. I call it “The Brasso Trade”.  As your man George Soros says:

I teach traders a very simple mechanical way to add to their position that also includes risk and trade management.  Now of course it’s much easier to talk about adding to your position than actually to do it so what I suggest is that people start by adding at the smallest amount possible – to get themselves into the habit of adding to their winning trades. Remember that is also very important – we are adding to winning trades. That is a very different proposition from averaging down on a losing trade!

Ee Lyn has very kindly provided me with some screen shots of one of her positions in CADJPY and has allowed me to share them with you all.

I hope it gives you some insight into the power of building a position and how adding to your winning trades is the way forward.  Perhaps you could make it part of your goals and objectives for 2019 to build an adding-on tactic to your trading plan?  I’ll be covering a small element of this in our Q1 Online Traders Forum on Saturday 12th January.

Ee Lyn has demonstrated some fine trading here and it bodes well for her continued success and development as a trader in 2019. I believe she’ll become a truly world-class trader and money manager.

Fellow Traders,

Over this last summer I re-read the trading classic Pitbull by Market Wizard Marty Schwartz. I originally read it about 12 years ago and so it was a pleasant re-read.  After all these years I was able to take some different messages from Marty’s journey.

I can heartily recommend the book as a good read for traders of all levels. Marty is pretty open about his experiences and the roller-coaster ride he went through.

I was reminded that on the last few pages he references a Pogo cartoon which I myself have used many times: “We have met the enemy, and he is us.”

Newbie traders may see that cartoon and be wondering what on earth that has to do with trading?  Experienced traders nod their head wisely and know instinctively how wise the cartoon is!

The longer you trade the more you realise that it is not the market which is your enemy, it is you.  The market is just a mirror the reflects your own strengths, weakness, biases and darker elements of your character!

New traders like to think that they trade in a silo, that all they need is a fool-proof trading strategy that will make money for themselves.  However with time and experience you realise that it becomes about understanding yourself better and subsequently managing yourself better than before.

That’s why every year I run a two-day workshop based on helping traders raise their self-awareness about managing themselves as traders. The idea is to start to show them their blind spots so they can start to mitigate the risks to themselves.

It’s also about helping you spot the signs of a possible performance slump, and more importantly what you can do to recover when you’re in one (and trust me, everyone has performance slumps as a trader – if they tell you that they don’t then they’re lying!)

On Managing Self and becoming a Money Manager is aimed at helping you evolve in your trading towards professional status, whilst building your own trading business.
It will consist of:
– 2 x full days on 22nd & 23rd November in Central London
– 1 x follow-up online session
For a total of 18  hours working together
It’ll will be split into 2 sections namely: Half on managing self and the other half on managing money – namely other people’s. You may or may not have dreams of becoming a money-manager, however acting as if you are a fund manager is never a bad thing in your own trading business. It holds you to a higher standard in your own behaviour. This whole stage will be focused on what you need to do to build your own trading business that will put you in the right space to be able to seek funding (if that is your long-term aim).

So as always there’s a cost implication: the cost for this stage will be £397.  However for viewers of this blog or members of the London or Dublin Traders Network I will be offering a  reduced price of £347 for the 2 days.

There are 4 slots left and as always it’s on a first-come, first-served basis. If you’re interested or want to know more then drop me a line.
Trade well,
Paul
@FXTraderPaul

Hello trader,

Well yesterday I was provided the alert below from my Facebook feed (this post isn’t about FB – but wasn’t that a beauty move last night?)

FB was politely reminding me of a post from 10 years ago – 25th July 2008. It made me smile – because I knew exactly what trade it was reminding me of. Fancy that – after 10 years and thousands of trades – I still remembered the exact trade that my post was about. Is that a) weird, or b) superb or c) a sign I need to get a life and a wife? (Maybe it’s all three.)

So what was my post about?  It was about a short in the Dow Jones that I had been running for several weeks from back in May – throughout July price was grinding north, and I was getting a little nervous that I had overstayed my welcome and that the trade was about to be profit-stopped out.

So lets take a look at a chart and I will share my successes and failures from that trade.

Behold this is the Daily chart of the Dow Jones from the summer of 2008. Lets add some context.  The Summer of 2007 was when the credit crunch began. How do I remember? Because I was in Verona to watch the Opera Carmen and L’Arena (yes, you’re right, I am much classier than I look.) It was whilst there that the credit crunch began – there was a couple of weeks of volatility and then the market calmed down. In fact people forget that after the credit crunch began the Dow actually climbed to new all-time-highs reaching its peak in October 2007 just a sliver under 14,200. After that it was all downhill, of a sorts. (Take a look at the weekly chart of that time – it set-up as a nice head and shoulders pattern)

If I’m honest I cant really remember anything major about trading during the early part of 2008. A quick look of my notes shows trading UK Equities, FX, Indices and Commodities (basically Gold). I would intra-day trade FX, but trade all the others off the Daily Chart. I don’t recall any sense of foreboding or imminent doom in the first half of 2008.  But I’ve learnt with time that market collapses are a bit like geo-political collapses and Arsenal Premier league challenges. Things happen slowly at first, and then things unravel really, really quickly!

What got me interested was end of April and start of May 2008 the price on the Daily Chart rallied upto the Daily 200 MA and printed a Double Top / M pattern / 123 – call it what you will. This was my short trigger. It was also back up towards the area of the weekly neckline. Nice easy trade. I shorted the second pin bar off the 200 MA and then also an additional trade when it broke point 2.

Price moved down nicely and I was happy when it broke the support area in the region of 11750. When price came back north form the 11000 area in mid July I was worried that the move was over and I was going to give a lot back (my stop was about 25 ticks above 12000 at that time). It was after it came back and touched that line in mid-to-late July that I posted that FB entry. For the remainder of July and August I watched price grind north.  For most of August it knocked about a range of 11250 – 11750 but as September took hold the daily ranges started to get larger and the swings wider.  We also started to have bad news seeping out. This is when I ended up closing the trade around the 11,250 mark. To be honest – I think I got spooked out – the news through September was getting worse and worse – and the markets reaction were becoming more volatile. At that time I was also trading money for other people and it just seemed a good move to lock in a healthy profit for me and clients.

So I traded down from approx. 12960 (1st trade) to 11250. That was a fine trade. However within 4-5 weeks of my exit the Dow was trading down at 8000!  Woulda, coulda, shoulda!!

The blue arrow is pointing to Monday 29th September, an interesting day. However Ive written enough for this piece so will save that for another day.

Hindsight Super Trader

What I did do also was when re-taking a look at the charts I started adding all the add-on trades that I missed. There were plenty…….but then there always are in hindsight! God its so easy to trade in hindsight. 😉

But its no bad exercise to look at past trades and see what can be learnt from the experience. It’s 10 years on since that trade. I believe myself to be a far wiser, smarter trader now than back then (I truly believe that experience counts massively for private traders – its just that most people don’t last long enough to learn that.)

I scribbled on some additional add-ons here.

So was I a good trader for my initial position? ( I think it was a lovely, and very natural, trade set-up for myself.)  Or was I a terrible trader for being spooked out of my position and not riding it through the great crash?

Trade well,

Paul

Hey Traders,

I did another piece on Core Finance last week and thought it was interesting enough to enlarge upon here.

Achieving consistent success in trading comes only once we learn to trade in line with our individual personality, character and beliefs. It is garnering this self-knowledge that becomes the real treasure on your trading journey. This series of articles will help you raise your awareness, develop self-knowledge and improve your approach to your trading business as you gain clarity on what type of trader you are.

 
There are plenty of ways to define what type of trader you are but for this instalment let us look at a simple yet immensely effective exercise regarding our emotions.

 
Fear & Greed are the dominant emotions expressed in the markets on a day-to day basis. (Whilst some may claim we could go deeper for the sake of this post we’ll keep it simple).

 
Fear & Greed influence every part of our lives but they are particularly evident when trading financial markets. The author would challenge anyone who told him that they had never experienced such emotions when placing and managing trades. There are many out there who would have you believe that trading can be an emotionless activity. The author would love to believe that, but his experience as a Trader and a coach to traders dispels that idea. We are human beings, a constant bag of emotions and it’s by accepting that and trying to use it to our advantage that we can learn, grow and succeed as both traders and human-beings.

 
With regards to Fear & Greed you as a human-being and trader will be predisposed to favouring one over the other but you will certainly experience both emotions during your trading adventures. So let us take a very brief look at the types of trader:

 
Greed Based Traders (GBT) tend to be hunting for action. GBT’s love the process of buying and selling and will take a trade on the flimsiest of evidence if they think they can turn a quick profit. GBT’s will trade anything and will always be searching for big profits. GBT’s tend to fail to treat the market with the respect it deserves. GBT’s will be almost addicted to intra day-trading and believe that using high leverage is a good thing!

They are predisposed to overtrading and over- leveraging their accounts.
Whilst they will enter the market in a heartbeat they are less reluctant to leave a trade quickly, even after every indicator tells them to get out as they want to hang on for the last drop of profit.

 
Fear Based Traders (FBT) occupy the opposite end of the spectrum. FBT’s can take an age to take a trade and quite often need everything to line up before they will take a position in the market. They will often miss opportunities because they’re waiting for the perfect set-up. They struggle to pull the trigger and invariably will use little or no leverage. Their money management is good but definitely on the conservative side.
Whereas a GBT gets in fast and gets out slowly a FBT gets in slowly and tends to get out quickly at the first sign of a possible loss or a possible win. They tend to take small losses….but they also cut their winners short which has an overall impact on their equity curve. Remember there’s a good chance that 90% of your profits will come from 10% of your trades but a FBT will often miss out on those 10% trades as they’ll snatch at profits far too quickly.

 
GBT’s are the ones who make the great fortunes……if they can last long enough as they are also more disposed to blow up their accounts! FBT’s tend to plod along.
As we mentioned earlier you will experience both emotions as a trader but which side of the fence do you predominantly sit on? It shouldn’t be too hard to work out. When coaching traders it’s one of the first questions the author looks to answer. Very often by active listening the trader will display their bias merely by the language they use.

 
The best traders are able to recognise their strengths and weaknesses and steer a steady course between both the FBT and GBT within them. There are plenty of simple tactics you can use to help support you with your bias. Within the limited confines of this article you could sum up a solution in two words: simplicity & structure. GBTs need a simple Risk Management structure that they can follow. This allows them to operate to their strengths without over-leveraging and over-trading in order to avoid a blow-up.

 
FBT’s need a simple yet precise trading structure that leaves them certain in their entry & exit points allowing no time for hesitation or doubt when the time comes to place a trade or exit a trade.

 
To paraphrase a line from a great coach, Robin Sharma, ‘Remember awareness precedes clarity, which precedes choice, which precedes action, which precedes success!’ If you can raise your awareness of what type of trader you are then you can make changes to your trading approach in order to avoid the pitfalls of either type of trader.

Trade well!