As traders, luck is often the four letter word that you shouldn’t say on TV (or anywhere else for that matter.) And yes, that includes you, all the O’daytraders and McScalpers even on St. Patrick’s Day.
If you decide to let luck alone be your guide in the markets, your account may end up as empty as a keg in South Boston or Chicago on March 18th. Here are five ways to make you “luckier” in the markets by putting the probabilities in your favor.
Learn the difference between “good trades” and “winning trades”
A winning trade is one where you make money, even if the research and decision-making were haphazard. A good trade is one where you stuck to your process and put in a position that was consistent with it, no matter what the outcome is on that particular trade. Focus on making good trades and the outcome will take care of itself.
Don’t forget about Ireland
Or Greece. Or China. The ability to examine the relationships between markets has become critical to successful trading in today’s highly volatile, globally-interconnected markets. Single-market methods of analysis have become dangerously outdated. Using artificial intelligence technologies that incorporate intermarket analysis, VantagePoint Software finds hidden patterns and relationships between 30 related markets and the target market to analyze and forecast price movements for more than 600 global markets each day. VantagePoint’s patented ability to help you find profitable trades can help lead you to your pot of gold.
Sharpen up your risk management
Be vigilant about getting out of losing positions quickly. Don’t lose a crippling amount of money if you are just unlucky. Even the best methodologies will fail if you are not disciplined and do not understand the risks you are taking on whether you are Irish or Italian.
Devise a Trades Checklist
This is where you lay out specific criteria that need to be met before getting into and out of a position. This will help discipline you and prevent you from “shooting from the hip.” Ultimately, the way to mitigate the role of luck is to work on your decision-making skills.
Use Leading Indicators
While past performance may be indicative of future results when it comes to drinking on St. Patrick’s Day, that doesn’t necessarily work with a market’s trend. You can learn when to stop imbibing green beer to prevent a hangover from past experience, but a market’s trend is fluid and ever changing.
So many traders operate only in hindsight. They study a chart on Wednesday night, look at a moving average and see that a particular market they’re interested in is trending up or down. Upon further inspection, they find that the trend actually started on Tuesday morning and that they’re already a couple of days late in getting into the position.
Technical Analysis is simply a reaction to past price action, and by using traditional lagging indicators, such as Moving Averages, there’s often missed opportunity. Using a predictive trading software like VantagePoint that uses leading technical indicators helps traders get into trends earlier, and, therefore, they have more confidence to stay in winning trades that last long past St. Patrick’s Day.
Market Forecasts for Gold and E-Mini S&P500.
BONUS GOLDEN NUGGET: If you prefer the predictive indicators of VantagePoint to the Luck of the Irish, check out the video below showing how VantagePoint can help you decide when to make a move on a market, or when to wait it out.
