Posted on

How Life Coaching Improves Trading

Our trading problems arise not from our lack of ability but from an imbalance in our brains. Humans today are hard wired to think incorrectly. Life coaching improves trading because it is way more comprehensive than any other kind of success coaching.

Most traders are not working on the issues of their trading challenges, rather they are addressing the end effect of their challenges. The issues are lack of self knowledge, not lack of ability.

Traditional trading coaching focuses on refining your entries and exits, your stop losses and so on. As Ed Seykota said:

There is no math for dealing with uncertainty

Ed Seykota hit the nail on the head, because if you have suppressed fears you will never become a great trader.

Ultimately every single trading challenge is rooted in incorrect subconscious thinking which leads to incorrect, often impulsive trading behaviours.

Enter, the life coach for traders

Life coaching is the most comprehensive form of coaching anyone could go for. It is a combination of healing, wisdom teaching and performance coaching.

A good life coach who knows about trading can help you develop a new way of seeing yourself and your (trading) world.

Life coaching encompasses everything

It includes spiritual development coaching, universal law, developing mindfulness, learning about yourself and techniques to apply this knowledge in your trading and in your life.

Very few traders bring this kind of comprehensive, holistic knowledge to the trading table. If they have the knowledge they don’t know how to apply it in their trading.

If they did, their trading would improve today.

We need to understand why we should do something differently

The hardest bit is this: In order to perform better as a trader you need to change yourself first. Only when you change yourself your trading improves. It’s tough, because 99% of all people resist change.

Your brain must be given a convincing reason why it should change the habits of a life time. Life coaching will give you the reasons why you must change. It is an essential part of the coaching process.

We need to be shown how to expand our knowledge first before we can move to the next level with ease and grace. The process is holistic and not compartmentalised.

Few traders have the knowledge, or the tools to choose that approach for themselves without guidance

They get lost in the minutiae of different techniques and end up moving backwards, or at best standing still. That’s the reality for 95% of all traders.

Life coaching improves trading because it tackles all the issues simultaneously weaving everything into an orderly framework which your trading mind will happily process. A happy stimulated brain learns faster. The result: Your trading improves.

Mercedes Oestermann van Essen is a thought leader in the field of trading psychology. She is the author of “The Buddhist Trader” and other books trading psychology and personal development.

Posted on

What Trading Psychology And Feng Shui Have In Common

I know, a weird title and an even weirder combination of subjects. Please bear with me for a second: I have traded since 2001. On my trading journey learned one big thing, which I call the unified theory of trading success. This thing is that absolutely everything is connected.

Let me explain:

Traders and humans at large are so used to thinking in boxes that we overlook the biggest, simplest law of our existence that influences how we create our (trading) success. I am talking about how consciousness works.

Consciousness permeates everything, that’s the universal law.

This law basically means that everything you look at and experience in your trading world is experienced through your consciousness first, before you become aware of the individual boxes which your mind has set up like a filter system, so that you can make sense of all the different experiences.

Here is the rub: Your mind processes most of its experiences subconsciously.

The tendency to see things as separate creates a skewed view of the world. It also makes you take the wrong action, because you act on the illusion of separation as if it where real.

Box thinking stops you from seeing what Feng Shui and trading have in common.

Have you ever considered that consciousness sees literally everything before you give the experience a value?

For example: You value a good trade set up as worthy of your attention, just as you would value a nice looking beach as a motivation to develop better trading habits. Yet, you know that the beach is not your reality today, because your office is dark and it’s raining, or snowing outside. That’s your reality as you see it.

Are you getting where I am going with this?

You have of course seen the images of traders sitting by the beach, or driving a Ferrari. The idea behind these images, usually brokers’ adverts, is to entice you to trade with them not because they are the greatest broker, but because your untrained mind is greedy. It wants the Ferrari and the beach life style NOW.

Almost too simple isn’t it?

If you are an experienced trader, or an experienced investor you will know how these “little” desires which run deep inside the emotional part of the brain influence your behaviour.

Imagine how your trading mind would relax if every time it steps into your trading room, it sees a lovely, desk, and a pleasing objet d’art. Your conscious trading mind reasons that it only needs a good looking chart.

How wrong you are:

Whenever your trading mind sees something that is beautiful, it stimulates a feel good factor that makes you want to perform better. The brain does not “see” the object d’art, rather it sees what it associates with that objet d’art: Like wealth, success, or security, the key motivators that drive us to carry on, even when we are going through a rough patch.

Remember: Your brain does not think in terms of now and tomorrow. Your brain only sees now in every moment.

When you enter your office next, take a look around, but with your CONSCIOUS mind switched on. Notice what subliminal messages your office is sending to your trading brain. I think you will be surprised.

Mercedes Oestermann van Essen is a thought leader in the field of trading psychology. She is the author of “The Buddhist Trader” and other books on trading psychology and personal development and business Holistic Feng Shui.

Posted on

Does Enlightenment Really Improve Trading?

To the linear trader’s mind there is no connection between enlightenment and trading performance. However, you couldn’t be more wrong. Why? Because enlightenment increases self knowledge, the inner knowledge which goes beyond your three dimensional “reality”. Inner knowledge reveals the fabric of the universe. It reveals how the rug is woven, instead of just showing you the patterns on the front of the rug.

Learning a trading system is easy

Anyone can doit. Learning about yourself is difficult. Almost nobody does it in the trading world. 95% of all traders fail in the long run because they think learning a system is all that is required.

You develop trading consistency once you see your thinking and actions BEFORE you take the action

The only way you can get to this place of EARLY recognitions is through extending what you know about yourself and bring it to your conscious awareness.

Enlightenment reveals how things are, not how YOU think they are

Traders and investors live in the illusion that they already know everything they need to know to make good trading decisions. That’s why it is a big shock to them when their trades don’t work out, or their lives don’t work out how they think they should work out.

Usually only once they incur big account draw downs and big relationship troubles will the look where they have not looked before for solutions.

Don’t wait that long

If you already knew everything there is to know about yourself and about the world and trading you would not have any trading problems. Thinking that you know everything gets you into a dangerous loop. You keep repeating the same old behaviours getting nowhere indefinitely.

The result? Frustration increases and so does dysfunctional behaviour

Enlightenment is just another acronym for “deep knowledge”

To be more specific: Knowledge brings light into your body and mind in esoteric terms. We are talking about the esoteric “knowing” that goes deeper into the hidden dimensions of your being that accesses the core of reality creation. You cannot heal a festering wound by putting a band aid over it. In order to make meaningful progress quickly you have to look deeper.

Enlightenment gives you the knowledge and the tools to expose erroneous thinking at the point of creation not later when you have accumulated big losses.

Enlightened knowledge removes you a few step from yourself. It puts you in the position of observer. As an information gatherer you learn new perspectives and learn how to look at aspects of your reality you never looked at before.

From this vantage point you can begin to re-construct your reality, because you have a broader vista.

When you change the way you look at things the things you look at change

This simple strategy should be pretty obvious to anyone. Yet the reality is that most traders cannot see it. They are so married to their way of thinking that trying something that to them may appear out of the box is impossible.

If your trading lacks consistency it clearly shows lack of knowledge somewhere along the line, usually it is the knowledge of how things work inside you.

Mercedes Oestermann van Essen is a thought leader in the field of trading psychology. She is the author of “The Buddhist Trader” and other books on trading psychology and personal development.

Posted on

When to Turn Your Trading System Off and When to Turn It Back On

One of the most difficult decisions that every automated trader has to make is when to turn the system off because its performance is starting to be questionable and when to turn the system back on because it is getting back to profits. In this article, I will try to describe the way I see it.

First of all, I need to say that this is one of the most difficult questions in automated trading. In the past, I made a lot of mistakes by turning the systems too early off or by turning them too early back on. To make things even more complicated, out of many ways that I have tried, there isn’t one rule that would stand out (negatively or positively) among others. Therefore, it is important to pick one and never break it.

TURNING THE SYSTEM OFF

1. Turn the system off when it exceeds 1.5 times of the drawdown of your backtesting equity

I set this rule in my early beginnings. There are several important facts about it that I need to point out.

First of all, this rule is good and bad at the same time. It depends on the backtest equity you use. In the past, I preferred to pick one optimization parameter set and apply it to the whole data history. More recently, I have started using regular reoptimization, when I combine several out of sample periods (each with different parameter set) and create one out of sample equity.

Retrospectively, I must admit that in the case of one parameter set applied to the whole data history, this rule of 1.5 times of the drawdown wasn’t really the optimal solution. The equity of one parameter set was too “in-sample” – i.e. the backtested history was almost always better than live results (which is usual). Therefore I turned the systems off too early and experienced losses quite often – should I have the system turned on a little longer, the system would have, in most cases, recover.

But you get completely different results when you use equity curve composed of several out of sample periods – as part of regular reoptimization. This equity is far more realistic in terms of what future results you should expect. So far it seems that this equity, composed of several out of sample intervals, is really realistic and the rule of 1.5 times the max. historical drawdown works very well in this case.

2. To determine the moment when to turn it off, use Monte Carlo drawdown

Despite the simplicity of the concept described above, I prefer the second method – using Monte Carlo analysis.

Again, you need to consider if you work with equity that uses just a simple parameter set, or if you work with equity curve composed of several out of sample intervals.

If we use a single parameter set for the whole history, then I find the Monte Carlo method better than the rule of 1.5 times the drawdown. When using Market System Analyzer for Monte Carlo calculation, you will get drawdown much bigger than 1.5x the drawdown and you don’t turn off the system too early. Moreover, what is really important here is that Monte Carlo really makes sense as the distribution of your future profits will be every time unique and different from the previous ones. So I consider Monte Carlo as a fundamental (and for me a primary) tool.

Recently, I have started to incline more to using Monte Carlo, even on the equity composed of several out of sample periods. I agree that drawdowns that you will get using this method are not very nice. On the other side, the numbers will prepare you for the worst possible scenario, so that you can create your portfolio wisely and capitalize properly. This is the method I currently use. Though it is conservative, it matches my trading style.

Most of the time I use equity curve composed of out of sample intervals, I run the Monte Carlo Analysis, note the 95% confidence level and the maximum drawdown that I get there is the point when I turn my system off – in case it is exceeded.

This is the approach that makes the most sense to me.

TURNING THE SYSTEM BACK ON

1. Turn the system back on when the equity gets above the point when it was turned off

When can I turn the system back on? It is even more difficult question then when to turn it off – at least for me. Many systems come back to life and start being profitable again. I have experienced this many times. One of the rules you can follow is to note the point when you have turned the system off and turn the system back on when the system gets above this point. Usually, the strategy continues in the drawdown for some time after you turn it off, but then it starts growing up again and quickly gets to the point when you turned it off. This approach I consider pretty aggressive, so let me get to the modification of this method that I prefer.

2. Turn the system back on when it is “fully recovered”

For a long time, I have used a rule to turn the system back on when it is fully recovered and makes new equity high. This rule works pretty well, even though the recovery sometimes can take up a year, or even longer. Still, I brought back several systems back to live trading using this rule and I consider it acceptable.What bothers me on this approach is that is too “binary” and also the fact that the recovery is sometimes so fast and so profitable that you miss some really nice profits. But on the other side, there is the previous method, which is really too aggressive for me.So, what I find to be the best approach is the combination of both.

3. Combination of both using progressive position sizing

The rule is to turn the system back on as soon as it reaches the point when it was turned off (method #1), but start trading it with a minimum number of contracts. As the system recovers, we start adding some more contracts.

Let’s say we have traded this system with three contracts. As soon as the system gets above the point when we have turned it off (or some acceptable level above this point), we start trading it with 1 contract. If the system recovers to the half of the drawdown, we add the second contract. And if the system gets fully recovered, we add the third contract as well.

At the moment, I find this method to be the best one. Currently, it is my preferred way as it uses the best of both methods.

THE RULE OF THUMB

Whatever rule you decide to follow, the most important is to keep using just one rule. Be absolutely conscientious. I have a lot of students who lost a lot of money just because they didn’t turn the system off at the pre-defined point. They switched themselves to so-called “hope mode” and they started hoping that the strategy will turn up and start growing again. But this moment never came and their loss got bigger and bigger.

You must be uncompromising in keeping of these rules and comply with them to 110%. It is painful to turn off the system, we have spent a lot of time on. But this is why we have a portfolio – we will always have systems that will fail, despite all our effort. We are not in a secure business, we are in the business with risks that we need rationally and professionally manage and control. The good news is that it is possible.

Posted on

Bollinger Bands: Using Volatility As a Technical Indicator

Day traders use Bollinger Bands® as a technical indicator to display a chart reading of volatility by how tight they are around a financial instrument. The degree of tightening or widening them surrounding the price action of a financial instrument determines the level of volatility. Chart facing, a 21-day moving average (preferred period of time) is surrounded by an upper and lower Bollinger Band®. They are meant to serve as a technical indicator of overbought (wide bands) and oversold (tight bands) market conditions.

How Are Bollinger Bands® Read?

Looking at financial instrument charting software with ‘tight’ Bollinger Bands® applied to the price action, a significant move to the up or down side may occur soon. However, if a financial instrument chart has ‘wide’ bands applied to price action, this may signal a significant move is not likely to occur in the not too distant future. Tight and wide, they can also be used as a counter technical indicator of both potential low and high volatility in that present price action is used to predict a different, future market move.

With the above said, the best conditions for the indicator’s use are periods of low volatility with scant price fluctuation. The more time passed in a low volatility environment, the more they will tighten around a financial instrument’s price action. When tightening more than usual, the bands may be signaling an increase in future volatility.

How Can Bollinger Bands® Be Used?

When analyzing Bollinger Bands® with the intention of day trading online, do not rush to make a decision if price action breaches the top or bottom band, as this is not always an indication of an immediate market move. That said, though most price action movement occurs within the indicator, a breach of an outer band is a rare occurrence indeed, but cannot be relied on to be a guaranteed buy/sell signal. In addition, though widely used, Bollinger Bands® are actually meant to be used in tandem with two or more other technical indicators such as Relative Strength Index (RSI) and MACD.

It is important to note, before day trading based on a signal derived from Bollinger Bands® and two other indicators, backtesting historical market trends with all of these indicators is strongly suggested. Backtesting these indicators against the historical market trend you are focusing on will provide an idea of how your strategy would have performed in historical market conditions.

Brian Horowitz writes Forex and futures trading articles at featuring examples of how technical indicators can potentially be used to trade financial markets.

Posted on

All About Binary Options Trading According to Mark Tencaten & Team

Many people attribute binary options trading as a betting of sorts because a trader has to trade only between two variables; the rise or the fall of a certain market or Forex. For some, however, this is an easy way of trading and often yields in substantial profits for traders. But no matter how simple it may look like, binary options trading is not for beginners and definitely will not work for people with zero experience with index trading. This is where Mark Tencaten and his team of professional market analysis experts come into the picture.

Mark’s team created an effective strategy to significantly win in binary options trading. By instituting a combination of variable trading timeframes and using market alerts that help traders put in the right trades, create a high probability of winning. The market alerts are basically predictions of whether a particular market or Forex is rising or falling for a given period. When the prediction of a market or Forex is to fall for a certain period, trading in that direction will result in a win if the market indeed falls within that certain period. These predictions are based on expert analysis of market experts around the world. To maximize profits, the team also trades on different foreign exchanges as another strategy. So within the day, there will be more than 10 trades per day getting traders the most out of the usual trading results.

An interview with Mark Tencaten gave us an overview of how he managed to win with binary options trading and what his ideas regarding its future in the index trading world.

We asked about his views on the current issues surrounding binary options trading and how to deal with the fake traders. His views circles around regulations. Binary Options is a legitimate trading and there is a small number of companies that engage unacceptable practices that somehow affects the image of the industry negatively. He pointed to some operations in Israel that lures people into engaging with certain brokers, getting their money and eventually leaving. These kinds of practices do not necessarily reflect the reality about binary options trading.

“I am a little bit appalled knowing that a small number of illegal companies that lured people into investing in binary made a huge negative connotation to the industry. I think the problem here was more on the regulation pertaining to the operation of these fake companies rather than the industry as a whole. Otherwise, if we single out binary options, then it is better that we also include other markets trading,” Tencaten wrote in an email.

He reiterated that binary options trading is not for newbies. Skills are needed to win in this and it would also require a self-assessment of the level of risk the traders can trade. Additionally, the market alerts are there as a guide but cannot be solely depended upon. Traders, especially the self-managed ones, should be able to learn and know how the commodities they are trading on behave within the market and at a given period.

Lastly, a good exit strategy will shield a trader from losing so much. Normally, trades can start at the minimum of 10% of the value the traders’ total daily trading money. This limit serves as a safeguard during the trading day and also guarantees of multiple trades within the day. They should also mind the Stop Loss – Stop Profit percentages as this will help them with automatically end trading once the set percentages are met.

In the end, the success of traders in binary options really depend on several factors. But if you get yourself abreast of the techniques and keep yourself connected with people such as Mark’s team, you will get to have more edge over everyone else.

George Foerstel is a Human Resource officer for a large company. He has worked for several companies and has gained a vast amount of information regarding personalities in different industries and other subjects. He resides in New York, New York presently and focuses on sharing his knowledge with other people through writing.

Posted on

How To Create Peace In Your Trading Mind

In a world that is dominated by trauma and fears of impending disasters you can be forgiven for thinking that the world is coming to an end. If you are a trader, you will only be too aware how the erratic intra day swings create havoc in your brain. If you knew how to create peace in your trading mind, your life would be much more enjoyable and your trading would improve too.

I hardly need to convince anyone of the truth of this who has traded for some time. I have worked with many professional traders over the years helping them to calm their over active trading minds and will share some techniques with you that work without fail.

Let’s first look at the three main reasons why you have failed to create peace in your trading mind. There are other issues too.

In this article I am going to deal with the things you can most easily fix, if you choose to. If you address these three issues you will give your overworked trading mind a heart start:

You worry about external events

Your environment is toxic

You lack the tools, or don’t apply techniques to create inner peace

When your inner world is in chaos you cannot produce calm in the outer world.

While you keep reacting to outside events, you are at best delaying positive change. When you live and work in a toxic environment your brain stops functioning as it should.

I could write books on why the world is in a state. You probably could too. The media is full of opinions, judgements, most of it negative. Focusing on the why’s will not help you become a better trader, a better entrepreneur, or simply have a more satisfying life.

Why? Because you have no influence on what goes on outside of your own brain.

Universal law states that you get what you focus on. While you focus on everything that’s wrong with the world, your trading, Donald Trump, or Hilary Clinton, you attract more reasons why you are helpless.

Accept that you cannot change the world.It’s the very first thing you can do to calm your overworked trading mind.

It isn’t your job to change the world. Your job is only to change yourself.

When you change yourself you also change the world.

Maybe this realisation will unburden your trading mind somewhat. It will reduce the worry a little bit.However, we are only dealing with one aspect of the issue:

In many years of working with professional traders I discovered that the effects from hours in front of the computer are very tough on the brain. The brain and the computer emit different frequencies which are incompatible with each other. Your brain will spend most of its time compensating for the mismatch in energy. This leaves you tired and drained.

When you neutralise the effect from EMF, (electro magnetic fields) from computers and other wi-fi equipment your brain can relax a little.

One great way of doing this is with guided meditation.

Make sure that your space is cleared regularly of negativity. Buildings have cell memory, just like people.

Ensure that your environment has clean energy and the meridians in the earth are clear.

Geopathic stress is a toxic energy that plagues all larger cities today. It is a direct by-product of EMF. These toxic energies, which are underground, in water cavities, running water and hollowed out areas, like under ground tunnels from mining activities and subways, cause major stress on the earth s mantle and on our bodies and minds. Geoipathic stress is easily cleared.

If you only implement these simple strategies you will find your creativity increases and inner harmony returns.

Most people think that they are victims of their circumstances, simply because they do not know how the universe works. They are unaware of how modern living is wreaking havoc with our bodies and our brains.

Next time you think that you are a bad trader, or you feel overwhelmed by life look at your environment first.

Ask yourself if you are using a guided meditation daily to calm your trading mind. The odds are that you are just living life in reaction mode. Isn’t it time that stopped and you started bringing peace and serenity back into your life?

Mercedes Oestermann van Essen is a trading psychology coach and success coach. She has traded her own account for 15 years and coaches professional traders and entrepreneurs internationally. She teaches how to create harmony through the understanding and application of the spiritual laws of the universe in our working and personal lives.

Her unique guided meditation techniques increase cognitive awareness. Her Holistic Feng Shui tools bring harmony to toxic environments. Many traders, and entrepreneurs alike have benefited from Mercedes’ innovative approach to better trading and holistic success.

Mercedes Oestermann van Essen is the author of “The Buddhist Trader” and other books on behavioural finance, trading psychology and Holistic Feng Shui.

Posted on

All About Share Market Trading

What are shares?

It’s a means to own a company.

The definition of ‘Securities’ as per the Securities Contracts Regulation Act (SCRA), 1956, includes instruments such as shares, bonds, stocks or other marketable securities of similar nature in or of any incorporate company or body corporate, government securities, derivatives of securities, units of collective investment scheme, interest and rights in securities, security receipt or any other instruments so declared by the Central Government.

What is Share Trading?

Shares trading refer to buying and selling of company shares – or any derivative products based on company stock – with the motive of profit earning.

Prerequisites for Share Trading

• We need to have DP(DEPOSITORY PARTICIPANT) account.

• We need to have a Trading account

• And of course money

How Trading Happens?

Companies get themselves listed on popular stock exchanges like NSE, BSE

Interested traders using terminal provided by their brokers trade on those shares.

Online Trading participants

• Investor- Participates through website of brokerage using internet and computer.

• Brokers- they contact each other through trading terminals and they also find who is interested to buy or sell shares.

• Stock exchange- It facilitates transactions through its servers. Most dominant stock exchange in India are NSE and BSE

• Registrar of Company-It is a government body that maintains records of all shareholders and updates database changes whenever ownership changes.

• Depositories- It includes depository participants which stores shares in electronic format.

• SEBI (Securities Exchange Board of India)- SEBI is a government body which regulates financial markets and looks into Investor complaints against companies.

Kinds of Trading

Intraday trading

Delivery based trading

Intraday Trading

Intraday trading includes buying and selling of stocks within the same trading day. The stocks purchased in this kind of trading, are not purchased with an intention to invest, but for the purpose of earning profits by analysing the movement of stock indices.

Deliver based Trading

Delivery based trading means buying shares and holding them for certain period of time is called delivery based trading.

In this method you have to place your buying request through your broker and pay for the current price of the stock. Once your request is executed the stocks that you have bought are deposited to your DP account. In this process you have to pay the full amount of the stock price. Once the stocks are deposited to your account you can then sell the stocks or hold them for as long as you want.

The delivery based trading at the cash segment is the simplest way of trading and the risk is comparatively lower.

The biggest advantage of delivery based trading is that you do not have any time limit for selling the stocks. But the disadvantage of delivery based trading is that you have to pay for full price of the stock and the brokerage is higher than other forms of investments.

Posted on

One Daytrading System, Five Versions, Possible (Dramatic) Improvements

In today’s article I would like to introduce an interesting thing on which I have spent quite some time. It’s about a few simple comparisons which I believe will interest common day traders. I will indicate new possibilities on how to grasp day trading.

So, what is this about? As I have already mentioned several times in the last few months, Market Internals can be used to improve overall performance of your automated trading systems. But can it also be used by discretionary day traders?

Generally speaking, the impact of the application of Market Internals (MI) on day trading can be absolutely essential and it can really bring an “unfair” advantage against those who have never heard about MI before. One trading system can be developed into numerous versions by only integrating different possibilities of MI – and without even modifying the original system itself; without even touching it! As needed, we can, with the help of MI, improve practically anything in our system – from average profit per trade, to success rate percentage or drawdown and quality of equity.

Let’s take a look at a simple trading system which I have traded discretionarily for years – the TNG method (Touch-And-Go). It is about a simple bounce from EMA 34. The system which I have used to test possibilities of MI for day traders is based on the TNG method and I have tested it in a completely automated way. This automated version of the system based on TNG allowed me to test possibilities of MI for day traders much faster, more accurately and in a simpler way. I was quite surprised how one system can bring an immense number of versions without the need to interfere with the system itself in any way!

So, as promised, let’s have a look on a few demonstrations.

First of all, the basic version of the system provides a very decent equity (the TNG idea is still very powerful and universal), to my taste, with only one pattern it generates far too many trades which is taking its toll on an average profit per trade (in basic system 51 USD). A reasonable decrease of number of trades, decrease of drawdown to half (original variant of the system has a maximum DD 3500 USD), increase of average trade and possibly a slightly better equity – those would certainly be pleasant “bonuses”. The good news is that all this is possible with the application of MI. What I wanted to demonstrate is the variability which the application of MI in a single system can bring – without touching the original system itself, without changing anything.

For example, one of my own MI techniques based on MI moving average managed to reduce radically the amount of trades, dramatically reduce drawdown, and adequately increase the amount of trades. And also considerably change the character of equity.

My next technique with the application of my personal MI Bollinger Band application, for change reduced the system by approximately 20% of the worse trades and contributed to an overall considerable improvement. The equity stayed the same, but it is slightly smoother, the parameters of the system improved, 20% of trades disappeared (among them some of the worst ones) – and all that without touching the original system whatsoever.

I have gained a similar reduction and similar improvement with another technique as well; a very simple one based on strong MI values.

What could be very interesting is the possible combination of both previous techniques – I believe that in such case all results would further improve.

The last demonstration comes from a different MI area, identification of optimal MI volatility and allowing the system to trade only such trades.

What could be very interesting here is to isolate the most optimal MI volatility and subsequently to apply one of the previous techniques (MI moving average or MI Bollinger) on it. All these are certainly impulses for further improvement. It is fascinating how one technique can dramatically and fundamentally influence a day trading system without the need to interfere with it.

And what is truly significant: A lot of the most important changes occurred on the level of statistics. I am not going to itemize all of them as there would really be many of them. Basically the most fundamental ones are:

– It was revealed that any parameter can be improved with one of the MI techniques; it was possible to decrease drawdown by half(!),

– What was particularly impressive – MI can be great in helping to manage the number of contracts: i.e. for example to add a contract in an especially strong situation, confirmed by Market Internals,

– MI can, in certain applications, truly help to exit the trade when the sentiment on the market dramatically changes, i.e. even before the basic stop-loss and in this way dramatically improves results,

– It is possible to dramatically increase a not very impressive avg. trade of the original system through a few MI techniques (the weakest link of the original variant of the system completely vanished).

Personally, I am continuously impressed by the possibilities of MI, especially when used in an innovative and creative way. I am surprised how few day traders are aware of this technique or how few actually use it.

MI are truly a unique technique which can have exceptional impact on your trading if used in a right innovative and creative way. Then MI are literally becoming an “unfair” advantage.

Happy Trading!

Posted on

How To Thrive In Your Trading Career

Let’s face it: Most traders if they are lucky manage to survive, very few thrive. In fact, I am certain most traders don’t even know what thriving means.

To thrive in your trading career is about much more than making it to the end of the trading day. I am not even talking about the money you may or may not be making. That will happen automatically when you learn to self actualize instead to react.

If you can make this quantum leap from reacting to self actualising your entire trading life will change for the better.

We are reactionary creatures by default

By this I mean that your brain has been trained to react by default. Impulse reactions drive the markets after a big news event like NFP, or the FOMC meetings.

There are trading bots which take advantage of these trading patterns which exaggerate the moves in the markets, but that is another story for another day.

The point I want you to get is this:

Your trading mind operates on reactionary auto pilot.

This is not in your interest because your mind is like an untrained monkey. The untrained mind is all over the place and thinks in dualistic terms. Good or bad and right or wrong. This thinking puts immense strain on your entire body. It causes stress and anxiety.

Such emotions fuel dualistic thinking and reactionary behaviour

In order to thrive in your trading career your have to learn techniques to distance yourself from your emotions.

There are only two ways in which you can do this:

Learn about yourself, how your brain works and how the universe works and learn how to apply this knowledge in your trading life. You will soon discover that most of your thoughts are actually meaningless.

When you learn to stay out of reaction you have a chance to thrive in your trading because your brain has spare capacity it now can use to, you guessed correctly design strategies that work for you.

This is what self actualization is all about:

When you have the spare capacity in your mind to allow new information in you will expand. You become more mindful because you are open to seeing new things about yourself, about the world the markets and so on which you had never seen before.

Imagine how the ability to stay out of reaction to anything you experience will set you free. Imagine how much better you feel. More energy fuels creativity and vision. You need both to thrive in your trading career and in your life in general.

Isn’t it time that you started to thrive today?

Mercedes Oestermann van Essen is a thought leader in the field of trading psychology. She is the author of “The Buddhist Trader” and other books on personal development.