38 Steps to Becoming a Successful Trader
Stock
index futures opened Tuesday’s session under pressure due to a number
of factors including a reported drop in Consumer Spending, another spike in
crude oil prices, and a report showing a surge in corporate layoffs in July,
which indicated that the labor market is still struggling to gain some
momentum. The ES tried to reverse the first hour’s losses, but it once again
played out as we’ve seen time and time again lately. A new high was printed,
but when nobody else would step up to the plate, good broker selling loomed
overhead.
The
September SP 500 futures closed Tuesday’s session with a loss of -8.25 points,
while the Dow futures gave up 75 points. Looking at the daily chart, the ES
posted an inside market structure high and is poised to confirm the handle on
its inverted cup and handle pattern. The YM posted an identical inside market
structure high and broke short again on the daily 3-Line Break chart. In the
small caps, the Russell E-mini (ER2) reversed off of Monday’s hanging man to
crack the handle on its inverted cup.
               
September
bonds (ZB) found a bid after the Consumer Spending report to negate Monday’s
shooting star. The Semiconductor Index (SOX) posted a market structure high as
it breaks its bear flag at its 20-day MA resistance.
Wednesday
morning is light on reports again with July ISM Services and June Factory orders
scheduled to be released at 10 am ET. Estimates are calling for slight
increases to 61.5 and 0.5% respectively. I’m still looking for some
follow-through pressure here before the market goes into a holding pattern ahead
of Friday’s jobs data.
The 38 Steps to
Become a Successful Trader
I found
this list and modified it a bit. Obviously, it should be taken “tongue in
cheek” and not literally, but anyone who’s lasted in this business can relate to
it.
1. We accumulate information–buying books, going to seminars, and researching.
2. We begin to trade with our “new” knowledge.
3. We consistently “donate” and then realize we may need more knowledge or
information.
4. We accumulate more information.
5. We switch the markets we are currently following.
6. We go back into the market and trade with our “updated” knowledge.
7. We get beat up again and begin to lose some of our confidence. Fear starts
setting in.
8. We start to listen to outside news and other traders.
9. We go back into the market and continue to donate.
10. We switch markets again.
11. We search for more information.
12. We go back into the market and continue to donate.
13. We get overconfident and the market humbles us.
14. We start to understand that trading success fully is going to take more time
and more knowledge than we anticipated.
Most people will give up at this point as they realize work is involved.Â
Stay
tuned this weekend for the rest!
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Please feel free to email me with any questions
you might have, and have a great trading week!