Attention Newbies: Avoid Adult Amusement Parks for FX Education

TraderNumber7

Well-known member
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Attention Newbies trying to find their way into the business of Trading the International Currency Markets.

In case you have not noticed, we are approaching the dawn of the ritualistic "Expo" Season, where you will be invited to Adult Amusement Parks to discuss the serious matter of Warfare in the Financial Markets and how you can easily navigate your way through the minefields of market crocks and swindlers, who are born to take every single dollar you carelessly deposit into the account of a Broker or Intermediary that you can't trust, should not trust, but have no way of knowing or understanding why.

So much for opening statements.

The success of any mission you undertake, depends to a very large degree on the level of preparation you bring to the mission requirements. Having mere knowledge is not enough. You need to understand how to apply the knowledge you have acquired over time, to produce the solution set that you have formulated as being worthy of yourself, your time and your commitment. Success in the financial markets is not based on a commercial you saw on television, where somebody tells you what success ought to look like. In the business of Financially Traded Markets, success is fully designed and defined by you, the Trader.

It is your own financial destiny, that you and you alone are trading for and responsible for making a reality. Step number one to becoming a successful Trader, is to accept these facts as being real. Step number two, is your own Education. The problem here, is that when it comes to the Forex, this particular step is one of the most under-appreciated of all, by the Newbie and the primary reason WHY you are being targeted and led to the slaughter, like so many blind Sheep strolling across some Nordic pasture of timeless bliss.

To that end, I post this thread. And, it is my sincere hope that at least some seriously successful Traders out there, take the time to deposit some genuine nuggets of wisdom along the way inside the pages of this Newbie Treatise on getting up to speed, the right way, without the need for the Newbie for run the gauntlet of Adult Amusement Park Exposes, that typically do more harm than good for those wishing to make the Financial Markets their new business model.

It is time that those of us who "made it," stand up and do something about the continue and perpetual mass slaughtering of the Newbie that is taking place all over the world in FX. I call it: Newbie Genocide. What you call it may vary. I've seen the wreckage. The devastated dreams. The sexy and well marketed false hopes fueled by unethical and downright immoral "parties" involved in the sleazy-side of the business, have been the fly-paper that attracts the Newbie to the field of slaughter.

This needs to come to an end and those of us that have already made it and/or who are in the process of making it, need to do something about it - because the powers that be most certainly want the status quo to continue - because they base their business model on the phrase: A New Sucker Is Born Every 30 Seconds. Rephrased to: A Forex Newbie Is Born Every 90 Seconds. These are the kinds of discussions they are having about you behind your back, in conference rooms that you have no access to. It is time for Newbies to fight back.

They give names like: Trader Clone and Cliff Hangers. They call you: Liquidity Suckers and Door Mats and FX Road Kill. They think you are utterly clueless and guess what, they are right and they have been right for years on that score, because most of you walk into the Vipers nest, completely unaware of what you are doing, or why you are doing it.

I've already given you the formula for how to take your Trading Life back, but I'll focus this thread on the most important factor of all within the overall formula: Education.

You need to be very sober minded in your approach to learning this business and you need to start accepting the fact that this is a business, not a hobby or a get rich quick scheme. Can you get rich quick? Sure, when all the stars and the planets of the Universe line-up in your favor in some extremely bizarre Bull Market run that never seems to end and anything you go "Long" with turns a profit - sure - many of done that. But, that's not the world of Forex. Here, you need to understand what you are doing and WHY you are doing it and to that end, I'll post a list of books that you can purchase or check-out from your local library for free (this does not have to cost an arm and a leg).

A good Newbie Book List:

Psycho-Genesis
Everything Begins in Mind
by: Jack Ensign Addington

Technical Analysis form A to Z
Covers Every Trading Tool from the Absolute Breadth Index to the Zig Zag
by: Steve B. Achelis

The Secrets of Economic Indicators
Hidden Clues to Future Economic Trends & Investment Opportunities
by: Bernard Baumohl

Fibonacci Analysis
Bloomberg Market Essentials Technical Analysis
by: Constance Brown

The Complete TurtleTrader
The Legend, the Lessons, the Results
by: Michael W. Covel

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A word about this publications. I don't receive a dime from their sale. The library should contain all of them, so one need not pay a dime for any of them.

Most importantly, you are a Newbie to Trading. The last thing you need to be hit with is an advanced text on Cross Class Derivatives Trading and Advanced Hedging Techniques using Complex Arbitration Methodologies, or something equally as rich. You also don't need to be in an alcohol induced stupor in "sin city" as you try to "learn how to trade the Forex markets," either - as you first foray into this wonderful life. Newbies should remain sober throughout their initial training and at all times while making ANY decisions about Trading ANY market. Period. Adult Theme Parks arrangements where you get set-up inside the "Newbie Kill Zone," is not the place to kick things off.

I (personally) am a Hybrid Technical Trader. That means I use both Technical and Fundamental Analysis to make trade worthy decisions, from the point of execution straight through to the close of the trade. I am a Multi-Instrument Trader, which means that I do not rely upon a single Instrument for any one particular trade. I use a "Profile" which includes concurrent multiple Instrument execution, per trade.

Over the past eight (8) years, I have developed the trading technology that enables me to get into and out of positions before the market has a chance to drive my positions into unrecoverable status. This affords me a kind of Stealth, a sort of Ninja type movement where I'm typically in positions that have not yet made their primary move and then out before the rest of the market heads for the exist. I'm basically a Ghost. I'm not supposed to even exist.

What I do is not for sale, never has been for sale and never will be for sale, because as far as I am concerned, there is no price tag on having the ability to virtually print money at will. I no longer "mentor" or "train" nor do I share any of my advanced work with anyone, at any time. I am not for hire; I am not seeking your money to manage; I am not seeking a public facing company of any kind related to trading and/or the financial markets. I'm a "joe" who simply learned how the game was played and have always wanted to at least help one Newbie get to the next level in their trading, by being as much of an inspiration as I can, to enable them to push harder, learn more and eventually realize their dreams as I have and am, realizing mine.

The book list above is in NO WAY a complete or even the best Newbie book list that can be compiled. And, that is not really the point. The point is to give you (the Newbie) the kind of head-start that I never had coming-up in this business. The point is to get you to realize that you are your own best Guru and that no one will care more about your Education as a Trader, than you. Your Education, is only part of the key to long lasting success in this business, but it is one of the most compelling and most profound keys you will ever discover as a Trader.

In this kind of economy, the Newbie is basic shark bait to unscrupulous characters cloaking themselves as "seers" and "gurus" but who only want YOUR money, one way or another. Your best defense is a good offense. And, your best offense comes from a solid Education. And, that Education begins with study. Your Education in this business will never end, even when you discover your Edge - that thing that moves you from dreamer to doer. The Edge is what enables you to make Trading a full-time Profession. The Edge, is what moves you from Trader to Trader & Money Manager. But, the Edge will never materialize absent you taking your Education very serious. Quite simply, the Edge, comes through study and the application of knowledge to real world events in the market place.


Why a book on Human Psychology?

Why would anyone try to enter this business if they don't understand what drives them internally.

Trading is about responding not reacting to market events. The reactionary mind is learned and it can cause all manner of ill in one's life. The reactionary mind is filled with archetypes that mostly filter the world through a negative outcome lens and set-up decisions that typically end up as regret in life. However, you can reprogram your mind by reprogramming your subconscious and as a direct result, make better, more informed, more intelligent, more sound decisions to respond to life, instead of continuously reacting to life. Why? Because "everything begins in Mind." Traders need to remain clam, not because clam is the reaction, but because calm is the natural response. A frantic mind, in this business, can derive some very financially damaging results.



Why a book on 30-60 Year Old Technical Analysis?


Why would any Newbie attempt to enter any traded market absent at least a basic understanding of what "The Market" is doing.

There is absolutely nothing wrong with studying what the market is "thinking" and WHY the market is thinking it. In order to do this, the Newbie needs to immerse him/her self in the thought process of the "Masses" and then find a way to do exactly the opposite. This has been one of the most singularly developmental processes in my entire career as a Trader & Private Fund Manager. To understand what "Whipsaw" truly means, why it happens to so many people and what to do to prevent it from happening to you, is something that you will look back upon in years to come, as one of the singularly most pivotal moments in your life as a Trader. Why do the vast majority of people still use 30-60 year old Technical Analysis? Because precious few people have discovered another language that describes market behavior. Those that have, possess something of extreme value. The other reason for studying a good book on Conventional Technical Analysis, is to start the process of learning how to approach the market systematically and with purpose.


Why a book on Fundamental Analysis?

Why would a Newbie approach the markets without an understanding of the probable magnitude behind the economic reports that insight into the pulse of the market.

This aspect of a dynamic market place is the reason why I developed a second Engine that produces indicators and signals based on Economic Reports alone. I have since integrated both the Technical system and the Economic system into a singular Engine that drives indicators, graphics and signals to screen, in such a way as to give me maximum optimization of trade position at any given time during the trade cycle. Often times, I can see the impact that Economic reports are having on current positions and determine whether or not the strength of the Technical set-up has enough structure to "contain" the news event - thus, making wiser decisions about current open positions. Economic Indicators can be converted from the analog to the digital and systematized into an integrated, all-inclusive indicator/signal generating system and used for routine trade decision support.

Currency markets are driven my many things, but underneath most currency movement, you will find as Newbies that Central Bank rate decisions can have some of the biggest impact on currency spot prices. And, not so surprisingly, Economic Reports that have nothing to do with Central Bank rate decisions directly, are typically filtered by the market as having potential for actual future rate movements or for setting the "expectation" by the market for actual future rate movements. In the currency markets (most of the time) people are either making decisions about actual rate movements, or decisions about what other market participants believe future rate movements might be (the Expectation). As a Newbie, it is very important you understand where Market Sentiment comes from, its source and its origin and studying Economic Reports & Indicators, can help you in this regard.


Why a book on Fibonacci?

This is no ordinary book on Fibonacci. This book by Constance Brown, is a book about Fibonacci Confluence Zones. Personally, I think the book is incorrectly titled. Constance Brown (or, her Editor) is not the easiest author to read, but who am I to point the finger. If you can hang in their an deal with her off-shoots into highly dense areas of applied (examples) of Fibonacci in art, architecture and science, then I think the Newbie (after reading a good book on conventional technical analysis overall) will gain something of value from this particular book. Your goal in this book is to reach the end where Constance talks about Rhythmic Waves and Harmonic Unity within Market Price & Time. You are not going to become a Fibonacci Market Savant by reading this one book, but I do expect this book to one of the first places where you have our eyes opened about the fact that Price has Structure and that said Structure is repeating at various levels, all the time and without ceasing!

Most people don't dig deep enough into Fibonacci and indeed, you will need to pick-up some other texts on the subject, but this book is a very good starting point for understanding that Probabilistic Price Tendencies are not figments of your imagination - they are real and if understood, they can be very profitable. That has less to do with Fibonacci, than it does the simple fact that Price truly does have Structure and that Structure is far more interesting than most people realize. Constance also does something else in this book that I found very revealing. She explains WHY most Traders do not draw Fibonacci Lines correctly. She explains WHY the starting and ending points of the retracement lines are often times completely missed by the average Technical Analysis "guru." This book is a keeper and one that you will refer to for years to come.



What on Earth is a Book on The Turtles Doing Here?


Quite simply - because if you call yourself a Trader and you have not read the Turtles story, then you are NO "Trader" at all! Not, yet. Even if you are successful at trading, you MUST at the very least, read their story.

Theirs is not an extremely complicated Technical system for trading. In fact, many (including myself) would argue that they produced nothing more than a very simplistic set of "rules" and "protocols" by which they were able to execute trades that over time and in the aggregate, amounted to a very successful (by any standard) run on the markets. What this book attempts to do, is step you through the actual process, instead of trying to remake the Turtle system, as so many other books attempt to achieve. I think Michael W. Covel, does an excellent job of pulling this off. He takes you through the mind of a Turtle, which is just as important to you as a Newbie, than what the Turtles actually did in real life. The Mindset, is the key here.

They got systematic in their approach to the market and won - pure and simple. This lesson, not necessarily how they did it, is of extreme vital importance to the Newbie, wondering how they should get started in the business of trading the Forex. Long before I was preaching the virtues of having a System, these guys were out there doing it, WITHOUT the benefit of high cycled, computer driven expert advisers and neural nets. What they applied to the markets was "technical" but it was fundamentally basic at the same time. It is what I call, Brute Force Systematization or BFS for short and it worked. The Turtles are proof positive that long-term "systems" can work, if and only if you stick with them AND if and only if they are viable to begin with.

[if any Experienced and Successful Trader wishes to add to this list of books for Newbies here, please feel free to round out the library for them. They need it.]
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Conclusion:

As a Newbie, you need to realize that I'm no different than you when it comes to trading and that if I can pull it off, then so can you. Your brain is no different than mine, in fact, you are probably smarter, more talented and more capable - so success can be yours as well.

But, whatever you do Newbie, try very hard to stay away from the allure of the Adult Amusement Park environment and mentality where Education is not the mission - rather - your complete and utter confusion about what's real and what's not real in this business. Everything begins in Mind and your mind should begin with an understanding of why you are here, searching and probing this business as a possible source of consistent revenue. You need to know that you can do it, but that the road is paved with Education and the price is your commitment to learning how this business works, inside and out.

The "next" phase, will be in developing our Unique Edge! That will be when you truly hit your stride and where the things you need to become clear in this process will become clear enough to count on regularly. ;)

However, if done properly and correctly, the Education MUST come before the Edge. Trying to seek an Edge absent an Education is putting the Albert Einstein before Galileo Galilei or the proverbial Cart before the Horse.
 
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