Commodity Trading and Psychology

Most beginners erroneously assume that because they are engaged in the inherently risky activity of trading that they are accepting the risk. This assumption cannot be further from the truth. In order to accept risk you must first understand risk the proper way and this is something most beginners fail to do.

Accepting risk means accepting the consequences of your trades without emotional discomfort or fear. This requires that you learn how to think about your trading and your relationship with the markets in such a way that the possibility of being wrong, missing out, losing, or leaving money on the table won’t cause your mental defense mechanisms to kick in, thereby taking you out of the mental state where you experience trading opportunities by losing your objectivity.

When a trader truly accepts risk the trader opens up the possibilities to take advantage of market opportunities and avoids self imposed limitations or low expectations from the market. Once you learn to create a state of mind that is not affected by market’s behavior, the struggle will cease to exist. When the internal struggle ends, you can take full advantage of all of your skills, analytical or otherwise to eventually realize your full potential as a trader.
So the first skill that beginners must focus on is the ability to fully accept the responsibility of loss as part of trading. I know one trader who starts to get worried when he gets too many winners in a row because it’s out of character for his strategy. Another trader looks forward to losers because he knows that as soon as the losing streak is over a winning streak will begin. There is no reaction regardless if each trade is a loser or a winner and it’s just part of the game. As a matter of fact you wouldn’t know when each trader is having a winning run or terrible losing run, their attitude doesn’t change one bit because they fully accepted the risk of loss as a natural part of the game.

The first step to true acceptance of risk is the fundamental belief that anything can happen when trading commodity and commodities contracts, this creates a foundation for building every other belief and attitude that is necessary to be consistently successful, and this is how traders begin to think in terms of probabilities.

You must learn and completely accept the fact that you don’t know what will happen next in commodities when trading, and in fact don’t need to know, in order to be consistently profitable. Since you don’t have to know the outcome of each trade you do not place any significance, emotional or otherwise, on each individual trade. This is very important for many beginners. Commodity brokers see this daily when traders put in trades. When I first out for example, I believed that how a trade performed was a reflection of my intelligence and my ability to pick winners and losers, so when I was winning I thought I was smart and when I was losing I thought I was stupid.

After several years I look back and realize that it was silly to think that way and now I can be right or wrong many times in a row without ever imagining it has something to do with my intelligence. This is how thinking in probabilities works. Active Futures is the leader in commodities. 

Psychology of Short Term Trading

Let me give you a simple scenario, take a typical beginner who has little or no trading experience. The trader initiates a long trade that goes his way.

The daytrader’s begins to fear that the market will start coming back down soon and quickly liquidates the position with a small profit, before the market has a chance to continue moving in his direction.

Conversely, when the trader gets a losing position he allows it to continue moving against him, because his greed overcomes the emotion to liquidate and gives the trader hope that the position will turn around and go his way. The trader is wired naturally to cut winners and let losers run.

This natural response is the opposite of a professional trader who is wired to do the exact opposite of the example I just provided, and as a result will cut losers and let his profits run.

The example I just described occur more often than you can imagine and to truly understand the underlying cause or the underlying reason people behave this way, we have to step away from trading and have to look inside our minds because the reason people behave this way when they start out trading requires a better understanding of basic human nature and the human thinking process.

The biggest reason why financial disasters are so common among day traders is because many of the perspectives, beliefs and principles that they learned at a young age and adopted in their daily lives have the opposite effect in the trading environment.

Not realizing this, most traders start their careers with a fundamental lack of understanding the skills that are truly necessary to become a professional trader at Market Geeks. Unfortunately, these skills cannot be purchased and must be developed within ourselves, only then will you have the skills that are necessary to be a consistently profitable trader.

Day Trading Tactics for Professionals

Creating a Belief in Consistency – The following beliefs are the building blocks that provide the foundation for what it means to be a consistent stock swing trading winner. I am a consistent winner because:

• I define my profit potential
• I predefine my risk on every trade
• I completely accept the risk
• I act without hesitation
• I continually monitor myself
• I understand and never violate these principles

To integrate these principles into your mental system at a functional level requires that you purposefully create a series of experiences that are consistent with them. You must learn to be an objective observer and think from the markets perspective (every moment is truly unique).

If there is enough will behind your effort, it is possible to experience a major shift in your mental structure very quickly. De-activating internal conflicts is not a function of time; it is a function of focused desire and belief. So the amount of desire and how much action you put into consciously following these steps, will determine how fast you begin seeing actual results from your efforts.

Over the years I have seen many stock swing traders who assimilated this information and adopted the principles explained in this tutorial. Most traders experienced substantial shift in their thinking process and as a result their trading greatly improved over a short amount of time.

One quality that each and every one of these traders shared is unshakable focus and determination to change and complete faith and belief that these principles work.

This brings us to the end of our market geeks stock swing trading tutorial. I hope you enjoyed watching this tutorial and learning this information as much as I did creating it for you. Hopefully, while going thru this tutorial you were able to look into your own mental process and relate to some of the inconsistencies and

Risk In Swing Trading Futures Contracts

Most traders have no concept of what it means to be a risk-taker in the way the successful traders think about risk. Most traders don’t realize that there is a big psychological difference between accepting risk and embracing risk as broker of commodities and futures. .

Accepting risk in futures trading is simply putting on a position and understanding somewhere in your mind that there is some chance that the position could go against you. Embracing the risk of loss is putting on a position and fully accepting without the slightest amount of fear or discomfort on a conscious and subconscious level that this position will be a losing trade.

To give you an analogy that you can understand, and possibly relate to, accepting risk is similar to believing the fact that one day you will have to put a fire out to help a neighbor and trading commodity futures brokers in need. Compare this with the mental state of a firefighter who knows with a strong degree of certainty that each day he goes to work, he will be putting out a fire.

You can probably imagine and appreciate the difference between the state of mind of the average person and a firefighter at the exact moment when both realize they have to put a fire out. You can probably imagine that the mental reaction and response is very different between the average person and the firefighter.

This creates a major conflict in the mind of most beginners futures brokerage clients, because to whatever degree they have not truly accepted the risk of loss is the same degree to which they will avoid that same risk of loss in futures trading. This is a very important point and one you should not take lightly.

Because when a  can truly accepted the risk of loss, he no longer defines and interprets market action in futures trading at active  information in a fearful and painful ways. When traders actually accomplish this, they stop trying to rationalize market action, jump the gun, hesitate, or hope that the market will give them money. It completely changes their attitude and belief about how markets work and how to make money from futures trading.

Traders Technical Patterns

Day trading stocks exploits intra-day value progressions to exchange on Swing HIghs highs and lows.

 STRATEGY GUIDES DECISION MAKING IN 2 WAYS

A speculation technique will help you:

Choose what stocks to purchase and when to purchase them.

Toss numerous potential stocks and trade strategies that may perform crudely after some time.

It’s similar to having a direction booklet directing you through the contributing procedure.

There are numerous distinctive methodologies out there and we’ll get to every one of them. The key is picking one that works for you and adhering to it.

Look into the best swing exchanging stock with market geeks swing trading stock strategies

2. Traders need to create an internal structure in the form of mental discipline and a perspective that guides their behavior so that they always act in their own self-interest. This structure must exist within us, because unlike society, the market does not and will not provide it for you.

3. The irony is that the very reason we are attracted to trading, the unlimited freedom of expression and the lack of imposed rules and limitations, is the same reason we feel resistance to creating the rules and boundaries that can properly guide our behavior when we trade. On one hand you have this new world with unlimited choices and possibilities and on the other hand you have to be the one to create the rules to function within the environment.

4. Join me as I go through the psychological process that will guide you and help you develop the most important skills necessary to be a truly successful trader.

5. For many years many famous scientists and Psychiatrists thought that profitable traders were smarter, harder working and analyzed the market better. But the biggest failures in trading come from some of the society’s brightest and smartest people. The largest group of consistent losers among traders is primarily doctors, lawyers, engineers, scientists, CEO’s, wealthy retirees and entrepreneurs. Conversely, some of the best traders at marketgeeks.com, I have ever witnessed had very little or no formal education or any type of special trading skill. This leads me to conclude that successful trading has absolutely nothing to do with intelligence.

Commodity Futures Trading Tactics

• Anything can happen – there are always unknown forces working in the commodity and futures market. Any exceptions that exist in your mind will be a source of conflict and may cause you to perceive market information as threatening.

• You don’t need to know what is going to happen next in the commodities and futures market in order to make money – this truth makes trading a probability and numbers game. When you truly believe that trading is a numbers game your expectations will be in harmony with the possibilities. Market information is only threatening if you are expecting the market to do something for you.

• There is a random distribution between wins and losses – If every loss puts you that much closer to a win, you will be waiting ready and willing to take the next trade “set up” this is true according to several futures and commodities brokers. If you lack this conviction you may anticipate the next edge with trepidation. You may start gathering evidence for or against the trade. If the fear of missing out is stronger, you will gather information in favor of the trade; if you fear another loss you will gather information against it.

• An edge is nothing more than an indication of a higher probability of one thing happening over another, especially when you are trading commodity contracts.  Creating consistency requires that you completely accept that trading is not about hoping, wondering, or gathering evidence one way or the other to determine if the next trade will work. The only evidence you need to gather is whether the variables you use to define your edge are present at any given moment. If the market is offering you a legitimate edge, determine the risk and take the trade.

• Every moment in the market is unique – If each moment is like no other then there is nothing at the rational level of your experience that can tell you for sure that you “know” what will happen next. Training your mind to believe in the uniqueness of each moment will act as a counteracting force neutralizing the automatic association process. The stronger your belief in the uniqueness of each moment the lower you potential to associate; the less you’re potential to associate, the more open your mind is to perceive what the market is offering from its perspective.