Before heading into the trading world,

there are some basics you should know

What will be your trading approach?

Technical analysis. Fundamental analysis.

Fundamental Sidecause of price movements

Technical Tradersprice movement

Macroeconomic Indicators

interest rates, employment rate and general health of

the economies.

Technical Analysis historical price data from the

charts and attempt to forecast the future behavior

or direction of price.

INFORMATION

PRICE

There are many indicators that are used in technical trading systems.

Trend Lines Fibonacci

Stochastic Oscillator MACD

Moving Averages Relative Strength Index

Most charting packages come with more indicators than you will ever need

Head and ShouldersTrianglesWedges

…

Counter Punch Trader

Most traders, both new and experienced,

tend to focus their trading system on a

technical level

It doesn't matterwhich approach you use for your trading

system

Many traders start to back test

When you back test, you have the luxury of

looking at different scenarios

Hindsight Bias

Test your trading system by forward testing

There is no excuse to not forward test.

You can trade with any amount at some

brokers

For the new trader, they are able to trade in "units" which can be

a lot lower than the micro account.

We now look at opportunity & expectancy

Expectancy

(Probability of winning x average win) -(Probability of losing x average loss)

You do not want your trading system to have a negative expectancy

What is opportunity?

X the expectancy of your trading system with opportunity,

see how much you can possibly make

We know psychology plays a huge part in your success…but

All that is meaningless without having sound money management

principles

It is all about risk and preserving your capital

The general rule of thumb for traders is to

risk between 1-3%

This was a "food for thought" video

Pick your system

Test it and

Don't bet the house