A nice video for the weekend. In fact, I found some similarities to trading. Watch it carefully, you might find some wisdoms for your trading. Enjoy!
Trading Lessons
Barista technique and Trading
A busy Monday, at the non-trading side, a tired Tuesday, and not so impressive Wednesday this sum up half of my week. I am not writing this post to tell you how were my days going, I don’t see a point of doing so. I have passed that stage.
Anyway, here is my infamous coffee thought of the day.
I start my day with a cup of coffee, every day. A cup of freshly ground, and brew Espresso or Long Black is essential. I am not a coffee expert, but I am a coffee lover. I have my grinder and Espresso machine at home. Here is a snippet from Home barista
Barista technique breaks down into three-time scales and skill levels:
The first is the minute or so spent grinding and making the shot. The key here is acquiring the skills to make shots consistently. One should be able to turn out four or five in a row with virtually the same timing, volume, color, crema, and taste. This skill is a physical thing, that is, it’s a matter of training and practice rather than learning.
The second is the time spent carefully tasting espresso or series of espressos, identifying the flavor balance and defects, and making adjustments to one’s pull or machines to correct them. The “dialing-in” process for a new blend usually requires a series of shots to get a satisfactory result and can proceed over several days to fine-tune it. To do this well, one needs to have experience in tasting and analyzing good espresso. One also needs to know how changes in extraction variables and machine settings affect the espresso’s taste.
The third is acquiring experience and informed preferences with a wide range of coffees, blends, espresso equipment, and alternative techniques. If you or someone you’re serving wants an espresso with a specific palette of flavors; you will know how to provide it. Home roasting and blending help in this. So does visit good cafes and roasteries, and talking with the knowledgeable people there.
I see a lot of similarities to trading. What do you think? Start making coffee…
Education video : How to use stops effectively
Adam from Market Club prepared a video to discuss about how to use stops effectively to lock in stop. Well, I thought it is a good idea to recap somethings that you might have forgotten.
If you are not using stop today, then my friend, your trading career is going to be very short, and that’s not the purpose of the game..
What do you really need to learn about trading
Lately, I have been spending my time working on my ATS (automated trading system), developing strategies and risk management models. I visited few forums, reading some brilliant ideas, and of course, unavoidable, some junks.
While reading the postings by some new/struggling traders, I have some thoughts.
What do you really need to learn about trading?
Technical analysis? Fundamental analysis? Risk management? trading psychology? Well, yes, yes, yes, I hear you. These are important. Very important. But, the essential skill one should really learn is the skill of learning. Learning the market condition.
Market is constantly changing. Or should I say market behaviour is consistently inconsistent. Your holy grail setup that works today might, or most likely, will fail later. Getting back to text books, forums trying to find new setups is just not the most effective route.
Learning to adjust your mindset, to accept the change, to really understand your battle field, with these, start to enhance or alter your strategies.
This is when your skills (technical analysis, fundamental analysis, etc) come into picture.
But bear in mind the fact: Technical analysis is a lagging tool, as it is based on what happened in the past, and forecast what is likely to happen in the future.
Fundamental analysis is a product of idealism. Ideally, the market should move according to its fundamentals. But, more often than not, the reality negates this. During bull markets, the high will get higher, regardless of how much the stock really worth. During the bear market like now, cheap can always get cheaper.
If you were to live trading the market, start developing a sense of market. Developing the ability to Know where you are, what you are facing, are far more valuable than watching MACD uptick and go Long(go wrong)… 🙂
Just another piece of rant from Trader Gav.
Coffee thought of the day….Patience is part of trading?
I was in a trading chat room. Most of the participants were waiting for trading call from a signal provider. While I don’t trade on these calls, it is really interesting to see how new or struggling traders or so-called busy trader-wanna-be waiting for calls desperately. Well, it is absolutely OK with subscribing to trading signal service . I am not arguing that.
Here is a short conversation I have found it to be interesting.
[ABC] Any one has any idea about trade alert today?
[123] apparently not
[DEF] no one????
[456] are you asking us to speculate on what will happen?
[ABC] guess we’ll just need to think for ourselves…
[Master] Patience its part of trading
Ah…”Patience is part of trading! “..Well said. But, to disappoint you, waiting for trading calls is not trading… face the fact, you are not trading if you are still spending your time waiting for the signal service provider to feed you with something…uhmm..something..
I am out for my morning coffee now…
Coffee thought – Trading the chart?
Just some thoughts when I am having my morning coffee in the rainy Melbourne.
Trading the Chart?
How should a trader use a price chart? This is just another question without an answer. Some traders claim themselves as “chart trader”. Yeah, give him a chart, he can trade his ass up.
Thinking in this way. We trade our view or opinion about the market. Trading, particularly, currency trading in my case, we are speculating. Yup, it is all about speculation. It is speculation, because you, in fact, nobody, know for sure which way the market is moving. Regardless of the time frame, you are trading off, you are trading your own opinion.
So, I know I am speculating. I know the price won’t necessarily reverse when RSI is over 70/30 or the MACD is crossing over some magic lines. Then what?
Forming your opinion. Explaining to yourself why do you think Dollar sucked, and you should short it.
I am talking about your own opinion, not the one from the talking heads on CNBC/Bloomberg or DailyFX.
Face it, there is really no expert in the trading industry. There are just a bunch of people who know more jargon, reading more news, and writing more craps than you do. Disagree with me? That’s your problem.
Now use the price chart as a roadmap.
So, you have formed your opinion. Cool. But do you know where you are? You gotta know your current location before start driving to your next destination. Here is where the fancy technical analysis comes in. Start confusing yourself with the trendlines, CCI indicators, pivot points, or some chicken indicators.
That’s part of the process. And nothing is wrong with that. As long as you are convinced, and you know where you currently are, and where you are heading, they are all good.
Stop or being stopped at some points is just part of the game. We evaluate , and decide the next move. Well, at least, that’s how I trade.
Crap, I think I talked too much today. Enjoy your weekend.
