There’s a great deal of talk in the markets these days about seasonal patterns, particularly in the stock market. Everywhere you turn the media is talking about how September is the worst month for stock market performance. I don’t have specific figures on that, but I’ll trust that it’s true given the sources who have stated it (like CNBC) are generally reliable. I can confirm that things get much more interesting in the fall once folks get back into full gear after the dog days of summer. And it’s...

Here’s an email I recieved from a clearly frustrated new forex trader. My problem is most of the time whenever I go into the market, the trade goes against me.. I m very frustrated each time this take place. How to over come this problem.. When is the best time to trade ? What is the trend going to be for EURUSD for this week. Obviously, I don’t know what the trend is going to be for EUR/USD. I just do my analysis and looking for good trading opportunities. On the subject of best time to trade, that depends. For...

What is the best way to approach trading only 1 stock over and over during the trading day? I know scalpers that take up to 100 trades a day and trade only 1 stock I got that question the other day. This is one of those times where I have to admit I have no idea. I don’t scalp, have never scalped, and have no plans on scalping individual stocks. I have no desire to be that fixated on the price action day-in and day-out. I’d probably go crazy. That’s just me, though. I know there are folks out there who scalp...

It’s ranting time! There’s a certain blogger out there who’s only purpose for posting (seemingly) is to sell his trading guide, or whatever he calls it. I’m not even sure why I bother to look at his posts. It must be to occassionally get me pissed me off at his hubris and ignorance enough to turn his foolish blathering into an educational post here. The latest entry (I’m not going to do him the favor of linking to it and helping his page rank) is full of nonsense like this bit here: There are certain...

There comes up from time to time the question of the type of computer hardward and software traders need to have. The following inquiry that came in by email the other day is along those lines. I need to get a couple of new computers, one main workstation and a laptop. I had hoped on buying new computers when I had my business plan fully developed and had a much clearer picture of what was required. I realize that no computer is going to make me a great trader, but I assume than a typical PC is needed. Do traders really need...

Indicators are always a favor subject among traders, especially new ones still trying to find their niche in the market. Here’s a set of questions related to that theme from a member of my mailing list. 1) I find Elliot Wave Principle quite hard to use as I am often guessing where to start, and I also find it hard to identify exactly which waves should be in the pattern I am trying to identify. Do you think it is a useful tool that, if used correctly, can give good indications about where a market will go more than 50%...

I received the following email from a trader struggling with trading for a living. Ho John, If possible I would like you ask you for a few questions. I’m sitting on futures USD/GBP. Trying to trade for living. The main problem now is that I have again big drawdown during that week. The same I had during first week of March contract. All the week I had very bad results, which caused me to think that my strategy is not working. Well I took 1 month to re-shape strategy and make it better. Then I’ve returned to trading...

The question of whether someone really should not be a trader is one that’s not often brought up in discussions between market participants. It’s almost as if the baseline assumption is that the sole criteria is that you want to trade. While I’m a believer in the view that just about anyone can learn, there are limits to that. Ignoring the obviously physical and mental disabilities, here are the ones I think are most important. Lack of Impulse Control If you cannot keep yourself from acting on impulse –...

I get and have frequently seen on trading discussion sites the question “How much do I need to trade for a living?”, or some variation thereof. Brett Steenbarger recently posted on the subject. His post addresses a couple of key points that I have also commented on in this blog previously (see Trading for a Living vs Trading for Wealth Building, among others). One of the major points Brett and I both make is how you need to do the math and figure out what kind of returns you will have to make to reach your objectives....

A member of my mailing list – from New Zealand, I believe – wrote in to express his frustration as to the path his trading is taking. I offer it up because I’m sure it is something which others are going through as well. hi john u once asked if i had any questions about trading—-how do u make money-im just starting my 3rd year, i still have lots to learn-actually im learning maybe i should give up and leave my money in the bank, 2 or 3 % is better than minus 80 % or worse– 2 months ago i joined e...

I had a question come in overnight regarding volume data and how it can be used for forex in terms of the price distribution methodology I use and teach. The question was: In connection with your price distribution course, how do you find the volume figures needed for this type of analysis in forex? I hear some use the futures as proxy but dont COT reports only come once a week? Of course in forex trading volume is always an issue since there is no one aggregate source for spot trading figures. Futures volume can be employed...