This is the second part of a series on creating a trading plan for yourself. The material is primarily excerpted from my book, The Essentials of Trading. How Does One Develop Trading Plan? The process of building a solid Trading Plan can be fairly straightforward, or it can be complex and involved. That is entirely based on the trader and what he or she is looking to accomplish. Much of that gets determined in the upcoming section on assessment. In essence, however, the remainder of this book takes one through the process of...

I’ve had the question of whether I have a trading plan template or anything like that I can provide or recommend a couple of times in recent weeks. In short, the answer is no, but that’s because I’m hesitant to recommend one. You see trading plans necessarily must be very personalized things. That makes the idea of a specific template something difficult to contemplate. A template is rigid, and as such isn’t going to work for everyone or even necessarily for any given trader all the time. With that in...

If you spend much time in trading circles you will almost certainly come across the term scalping. So what exactly is that? According to the Trade2Win Traderpedia, scalping is: The term used for a day trade method where trades are opened and close within a very short time scale, perhaps anything from a second or two to a few minutes. Basically, scalping means dipping in and out of the market quickly, going after very small gains, but very frequently. This type of trading methodology requires a very intense focus on the price...

When I was a volleyball coach (youth and college) one of the things that was very readily observable was the value of experience. There was no more clear example of it than one day when I brought an 18-and-under girls’ team to compete in an adult tournament. It was something I did to help the kids get some valuable experience. The team I had was a relatively strong one as compared to other similar age group teams from our region (New England). They were All State caliber high school players with some decent size and athleticism....

How are your stock picking skills? Do you think you can beat the S&P 500? If so, you’ll want to check out a new site I came across – UpDown. I’ve actually signed up and started making stock picks. Now you might be wondering why someone like myself would take part in a virtual investing type of program. Well, firstly I’m interested in the basic experiment the site is founded upon. The owners are looking to use it as a way to generate a strategy to run a hedge fund. They pretty much think that if they...

In case you weren’t aware, I have pages on some of the bigger social networking sites. If you do too, then lets connect! Linked In: www.linkedin.com/in/essentialsoftrading Facebook: www.facebook.com/pages/The-Essentials-of-Trading/133495643353 Twitter: twitter.com/RhodyTrader I’ll admit to not being totally up to speed the way I would like or as active on all this stuff as I probably should be, but I’m getting there. If you have any advice or recommendations, definitely feel free to share! Struggling with...

It is very often true that doing the easy thing is not the right thing. I’ve been in the markets for about 20 years now and I have to occassionally have that lesson reinforced. The price distribution charting method I use in my work developing S&P short-term trading strategy each day for my institutional readers does not suffer cowardice lightly. The best risk/reward trades it identifies for me are generally the ones hardest to actually take. Wednesday was a perfect example. Of late, any time the market has made a...

I am a newbie forex trader. My greatest challenge is identifying entry and exit using candlestick. I’ll be glad if u can help. Once upon a time, in my early days as a market analyst I used to write candlestick commentary – particularly on the fixed income (interest rate) market. The second article I ever had published was on the subject. I think the title was something about using candlestick real-bodies to identify support and resistance levels. It must have been fairly interesting because Steve Nison, who was...

How do I know that I am ready to trade forex live? This, I’m sure, is a question which goes through the mind of just about anyone who starts off learning about trading and does their recommended work through demo trading. At some point you do have to make the jump to real money trading. It’s just a question of when. As you may be aware, I’m a major proponent of getting one’s feet wet in real trading as early in one’s developmental process as possible (see Trade real money, not paper money). I’m...

One of my mailing list members sent me the following inquiry:  Is it still feasible to trade forex say in the next one year, especially for a small forex trader like me (+/- USD 3,000)? This is assuming that I have master all the necessary knowledge and skills to trade forex. The first part of his question is in regards to the volatility of the forex market (all markets really) over the last year. He’s definitely not the first to have expressed concerns about what’s been going on. Lots of folks who have gotten...

I’ve just completed Way of the Turtle: The Secret Methods that Turned Ordinary People into Legendary Traders by Curtis Faith. If the term “Turtles” has you scratching your head, then I will start by saying that they were a group of students brought together by legendary trader Richard Dennis (featured in Market Wizards) in the mid-1980s as part of an experiment to see if successful trading could be taught. Dennis and his partner William Eckhardt (featured in The New Market Wizards) selected two classes and...