Well... I can't really comment on those sites, since I am not familiar with them. I only comment on things that I have had at least some experience with. Here's the thing: The most useful thing that any "guru" is going to teach you about trading is stuff that you can get from any decent trading book, and stuff that you have probably heard a thousand times before. Things like cut your losses short, let your winners run, be patient, don't be greedy, etc., etc. Their individual methods are no better or worse than any method you could come up with yourself. The problem with a lot of new traders is that they want someone to sell them a step-by-step system for how to make money.... but they don't realize that there is no such thing as a step-by-step system for how to make money in the markets, and there never will be. "The market" is nothing more than all the other human beings in the world performing actions that are specifically designed to take your money. How can there be a simple method to always beat them? There can't be.... if there could be, it would have already been programmed into a computer, and that computer would have made all the money in the entire world by this point. Do you really believe that this is possible? If I wanted to teach you how to bake a cake, I could give you a set of instructions, and you could follow them. If you've never cooked before, the first cake you baked might not be that good, but you could at least still eat it. The second one would be better, and by the time you were making your tenth cake you would probably be pretty efficient at it. This is how a lot of new traders approach trading, and how a lot of charlatans on the web and on TV sell it - "just follow our simple system and it will all work out for you". But trading is not like baking a cake at all. Baking a cake is an activity that is not all that difficult to master, and works exactly the same every time you try it. It is repeatable. Every time you put that cake in the oven, turn it to 450 Farenheit, and leave it for an hour, you will get a cooked dessert. EVERY time. That's why it's easy. On the other hand, things do NOT work the same every time in trading. You can have a chart pattern that looks very similar to what an instructor showed you, and the time you try to trade it, it won't work. Patterns are not 100% repeatable in trading, and indicators are not 100% reliable. Most new traders can't deal with this uncertainty, and as a result they decide to go in search of a "teacher" who will take all the uncertainty away and lead them down the simple and easy-to-follow path to profits. The problem is, even if you get a relatively decent teacher, it doesn't mean that his or her method will work for you. You have to find your own way to deal with the uncertainty of the markets, and one person's method or approach may very well not work psychologically for another person. In addition, there are a number of "teachers" out there who really aren't that good, and who have their own issues which they will pass on to you. Case in point: the guy being discussed in this thread who sits there all day and doesn't trade, missing out on 20 point runs in the S&P. That is a STUPID trading method. You shouldn't be learning that crap. Yet if you don't know any better, you could sit there for months and not only waste your money but learn tons of bad habits. Trading is a darkened maze... you have to stumble through it yourself and figure out what works and what doesn't work... for YOU. There are certain things that are true for everyone, but those are mostly psychological things and can be learned for free from a book. In the end, to make money in this game you are going to have to be better than 9 out of every 10 people at it, because only 10% of traders actually make consistent money. Do you seriously believe that anyone can put you through a step-by-step course that will automatically teach you how to be better than 90% of people at anything? The harsh truth is that even if you get a great teacher, it's no guarantee of success. If you are constantly feeling the need to be "taught" anything, it's probably because you don't have the confidence in yourself to believe that you can just go and figure it out on your own... and that shows that you are a follower, not a leader. Followers don't make it in this game, only leaders do. There's nothing wrong with going to a couple of "gurus" in the beginning, and then getting disillusioned... but if you keep going to one guru after another constantly looking for that magic solution to all your problems, chances are that you are not successful trader material anyways and will never make it. If you have the confidence to say "screw you" to all the gurus and believe that you can do a better job than they can, given enough time and practice - then you have a shot. That's doesn't mean that you can't learn something here and there from various people, but you have to take responsibility for your own learning and progress, because nobody else will. Incidentally, I am not saying that this describes you in any way... it just describes most of the students that sign up for these courses. Sooner or later you will have to take control of your own trading, and figure out your own method. It can be a derivative of something that you were taught by someone, but it doesn't have to be, and in the end I think you will see that spending money on all these courses isn't going to be as useful as you think.
this is the best advice i have read on Elite Trader. I have personal been through a few gurus. and now at the stage of learning by myself.
While I agree that you need to use your own stragey... your point about competition isn't clear to me. Personally, I wouldn't mind if a bunch of traders started entering in my direction AFTER I WAS IN.
Bakrob99 - I believe you got the idea. Back in the late 90's before the tech bust there were several large rooms that got in trouble for buying or selling a large volume of stock in a company, then advising all their members to do the same! Which at the high or low dumped their stake!! That is why most rooms today claim to be educational only. So they don't end up in jail or sued to holy hell!! Mind you now, this is crust of the stories I have heard only. Do not know first hand! But it makes sense to me.
Best advice to traders chasing some holy grail. You can learn learn something form rooms - if their fees isn't more than the price of a good book. I have been in the EminiAddict room. The monthly fee is like that of a book - that is one thing I can recommend for - as it is more likely buying a book. You can learn some basics there if you are new to trading futures. Good place to start but don't get stuck there.
There's one more piece of advice that I can give you: Think of the market as a poker game, because that's exactly what it is. In Texas Holdem, you have a number of players that sit around a table playing cards. Each player has two hole cards that nobody else can see, and there are communal cards that come out at various stages of betting, which each player can use to form their hand. This is pretty much an exact analogy to trading. You should think of the chart as being the same as the cards that everyone can see on the table. You know what those cards are, and everyone knows what those cards are. They represent all the trades that have already happened, and they can be represented in an infinite number of different ways, using minute charts, tick charts, indicators, or whatever... but it's all the same information, and everybody has the same access to it. What you don't see is the cards that the other players are holding, and they don't see your cards. In trading, this is represented as the money that has yet to come into the market in one direction or another, but is still watching what is going on. Just like in poker, there are some players that have bigger chip stacks than others. You as a small trader are going to have no effect in a game of poker if you go "all in", because you hardly have any chips, and so nobody is going to be scared by that type of bet. On the other hand, if you had the largest amount of chips at the table and went "all in", everybody at the table would notice because that would drastically affect how everyone would play that hand. In the same way, the big/smart money is the largest player at the table. When they go "all in", they only do it when they have good cards. Good cards in this case means that they have set up the dummies to go short when they should be long, and vice versa. They manipulate the market by drawing chart patterns to get people going the wrong way, just like a master poker player will make bets in a manner to always obscure what he/she is really doing. You never know if a great poker player is bluffing or holding double aces, and it's the same with the market... they play it to get you thinking one thing while doing another. Once they have got you going in the wrong direction, they go "all in", putting all their chips in the pot. This means that they start buying or selling in large quantities, which drives the market. Since you are positioned wrong, you now have to cover or sell because price is moving against you, and that fuels the move in that direction. Then the master poker players cover their positions at a profit. This is going on every day in every traded instrument, on every time frame. That is what the markets ARE. Most newbies don't even understand that they are playing a game of poker, and therefore try to approach the market as though it is some type of natural phenomenon that can be easily described by an equation or a set of simple steps. They think that it is something like gravity, where once you know the mathematical equation that describes it, you can just use it in a repeatable manner. But that's not what the markets are. You can't give a person a simple set of steps to always beat their opponents at poker, because every bet and every hand is situational, and depends very much on what happened the past few hands. It also depends what your unpredictable human opponents are doing, and that cannot be mathematically described. The best that you can do in poker, as in trading, is to understand the odds, and more specifically, to understand the odds in the context of what is going on. As an example, take a look at the massive rally that occurred in early July. Now, every trading textbook will tell you that a head and shoulders pattern is one of the most reliable patterns around. So theoretically, you could sell that pattern and expect to make money most of the time... yet, that pattern didn't work in July. A lot of middle-of-the-road traders decided to go short there, got stopped out, and then said to themselves "oh well, that didn't work, too bad". They didn't get too badly hurt (unlike the newbs who assumed that it HAD to go down and therefore kept holding on long after the pattern was invalidated), but they also didn't have the knowledge or experience to know that this was likely going to be one of those times when the pattern backfired. A more experienced trader would have taken the CONTEXT of that pattern into account. He would have noticed that everyone was talking about the head and shoulders pattern, and that people had been saying for some time that the market was overextended. That means that people were getting short, and that would have made the experienced trader skeptical about the pattern. In addition, he would have realized that the economy was still very fragile, and that the government was pulling out all stops to make it look like a recovery was about to happen. That would have told him that a massive decline was unlikely at that juncture, even though in normal times, a pattern like that would have probably led to a decline. But the experienced trader would have known that these are not normal times. He would have realized that in the CONTEXT of this market, that pattern didn't mean what it normally means. Finally, he would have started looking very closely for signals that could have invalidated the pattern. As it turns out, there was a VSA buy signal a few days before the first spike. This would have made the experienced trader even more attentive... and when the massive buying started intra-day, he would have jumped in because this was a possibility that he was anticipating. He also would have realized in judging the mood of the other players in the market that people were calling tops all the way up, which would have told him that this was going to continue. An experienced trader knows that the market can run for a lot longer than anyone thinks, and he would have just been following his set of trend-following rules that would have told him when most of the rally was over, without trying to anticipate the top. Another example was the rally from S&P 1000... same thing. Everyone calling tops all the way up. Finally, on the second to last day at 1063, we had all kinds of threads on ET saying "Is shorting dead?", "Just buy!", and so on. That's when you knew the top was near. Sure enough, a VSA sell signal pops up, the market spikes on fed day, and another massive reversal. I was looking for that. It didn't have to happen, we could have continued higher... but an experienced trader knows what MIGHT happen and starts looking for it ahead of time, while still keeping his mind open. Once you understand that this is what is actually going on and that you are actually involved in a game of poker, you will not read a chart the same way. You will not look at the chart and say "what is this chart telling me?", you will look at the chart and ask "what does everyone ELSE think the chart is saying?". It's the second question that will determine which way price is going to go, not the first.
I hate to admit it but, but I had a really bad day. Something is wrong with me. I broke my rules and lost a lot of money today. I wasn't able to catch the start of today's down move but somehow got convinced it would continue. Further, I have a mechanical system that I've been trading for a while, and it gave me a short trade today near the bottom. I would have lost around $1300 if I simply followed the rules today and gotten stopped out. I wound up losing a LOT more than that due to breaking the rules. I allowed the market play me like a fiddle today. Instead of just sticking to the rules and setting a stop, I wound up adding more contracts as my position went against me without any stop. Then, when I could not stand it anymore I actually reversed my position thinking it might go higher and maybe I would recover some of the loss, but eventually it reversed downward, and I scaled out at an even bigger loss. I really should consider whether or not to continue trading if I am going to be pulling crazy stunts like that. I would like to be able to trade on my own without needing anyone's help, but today I repeated a very dumb mistake that I made in the past (breaking my rules, letting the market play me like a fiddle when trying to daytrade). I don't know what the answer is for me at this point. The person running the trading room thinks he can help me with my trading issues, and seems like a nice guy, but the room is expensive, and so far I am not profitable from the trading in the room either, and he misses out on big moves, although he says better trades will be happening this fall as the market breaks out of the current trading range. Should I continue trading on my own and HOPE that I have finally learned my lesson today, even though I have already repeated this same dumb (expensive) mistake a few times on occasion?
Are you a consistently profitable trader yet? We both know the answer to that question is NO. If you were, you wouldn't be in a trading room, and you wouldn't be asking questions on this site. You said that you "would have lost" $1300 if you had followed your rules, but instead you lost a lot more. Are you INSANE? Why are you trading with real money and risking thousands of dollars while you still are not consistently profitable and are still in the process of learning? Some people say that you should jump straight into live money trading without first practicing your ass off on a sim. Those people are, to be blunt, a bunch of fucking idiots. There is NO point in trading with live money until you are so good on a realistic simulator that you can make money in your sleep. (You need to have a good program for this, because it has to represent live fills relatively accurately.) Then, and ONLY then, should you go live with a SMALL real account. ONE CONTRACT. Trade that until you are sure you know what you are doing (since live trading will throw you curves that you didn't have in the sim), and then gradually increase your size. Just because live trading is not the same as sim and is in fact a lot harder, doesn't mean that you shouldn't work out a lot of your problems on the sim first... it's a lot cheaper. Saying that you should learn with live trading without practicing your ass off on a demo first is like saying you should learn how to fly a plane by reading a manual once and then going up in a real plane your first day. That's not how they train pilots. FIRST they get them on a simulator for a while, and THEN they go up in a live plane with an instructor for the first time when they are ready. And on that first flight, they don't do anything too crazy. How much have you really practiced on a simulator yet? Have you had one or two months straight where you have consistently traded and were able to make money most days, without losing too much on the bad days? Are you so confident on a sim that you could do it in your sleep? If not, why are you risking real money? Today's lesson has taught you that you are not ready to be trading live money yet. A simulator is not the same as live money, but if you are not yet consistently profitable on a sim there is no way you should be risking live money, and certainly no way you should be trading with more than one contract. As I mentioned, your first crazy stunt was trading live money without being ready. You are not ready. You are still learning, asking questions, and going to other people for advice. Trading isn't a hobby, it's a very dangerous game played with very sharp knives that will slice your account to pieces unless you are the best of the best. You need to practice a heck of a lot more before you risk any more of your capital. We've already been over this - lots of people including me have told you that this guy is useless. But in any case nobody can help you if you refuse to help yourself. I can assure you that if you continue to trade with live money from this point forward, you will only suffer more losses in the long run. After a day like today, you should go back and trade on a simulator for a LONG time until you are ready. You will know you are ready when you stop asking questions on this site and start answering them. Then, and ONLY then, should you start trading with ONE contract and progress from there. Many people want to take shortcuts on the road to being a successful trader by trading with live money before they are ready, and those people are exactly what fuels the market on days like today. Let me see if I can put this clearly for you: NO!!!!!! ABSOLUTELY NO WAY IN HELL!!! Is that clear enough? You should NOT continue trading from this point forward as you have been, and if the word "HOPE" is anywhere in your vocabulary as it pertains to trading, you should NEVER place a live trade. Trading is not about HOPE. It's about KNOWING that you are going to be able to handle the market, not HOPING that you can do it. Lots of losing traders got crushed on that decline today on the "slope of hope". Don't be one of them again. Practice on a sim until you stop feeling the need to ask questions in this thread.
And one more thing, just a tip. You should always know how far your chosen market likes to run. How many times have you seen the S&P run 20 points in a single day? Go back and count, there are lots. How many times have you seen it run 30 points? Not many. If you got short near the bottom, you were getting short near the end of a 20 point move. The chances of it continuing much further were pretty small.... at best it probably would have just sat there all day. This is the type of thing you need to learn before you trade with any more live money.