I have been calling live trades in a trade room for over 4 years. When I think back on the entire experience, it boggles my mind to think that I probably have called over 15,000 live trades; each individual trade, burdened with the weight of responsibility I felt for all my members in the trade room, and the uncertainty and self-doubt, wanting to creep in and influence each and every decision.
I will never forget the very first day — the very first trade even — that I had to call LIVE! Leading up to that moment, I had tried to anticipate how I would feel and how I would react when the first trade signal appeared. What I anticipated paled in comparison with the reality of what I felt.
There were over 60 people in the trade room, all there to try out our brand new service. To say I was nervous would be a gross understatement. Do you know what it feels like to go on stage and sing a solo in front of all your friends, family, peers, strangers… an entire audience of people? With the curtains open, the bright spot lights shining on your face, nowhere to run or hide; the music starting – all of a sudden you have to open up your mouth and SING!! Act! Play the role for which you were cast.
Some say there is nothing more frightening. Surveys have shown that the fear of being on stage in such a situation is scarier than death itself. That’s exactly how I felt when the first trade setup appeared on my very first day of calling a live trade room. It didn’t feel right. A queasy feeling descended upon me and I could feel the bright lights blinding me, everybody in the audience hanging on every syllable that came out of my mouth. The reason I can make such a comparison is because I was the one who won a lead role in my 8th grade operetta and I experienced having to sing on stage in front of the entire school, family, and friends. I couldn’t eat or sleep for a week leading up to opening night and believe me when I tell you, I probably would have preferred facing the Grim Reaper himself, as opposed to being in that situation. Five minutes before curtain call I was frozen and felt as if I wanted to vomit. My first day calling live trades was déjà vu.
When the curtains opened, something deep inside took control and I lost myself to the part I had to play. By the time it was over, I was receiving a deafening applause from the audience and the sensations I was feeling were simply indescribable.
Well, in contrast, my first called live trade was a loss. In fact, we ended up losing 17 ticks on the Russell eMini that day. The next day, half the members from the day before were gone. There was NO deafening applause for me that day.
We went on to win over 150 TF points by the end of the year, on single position trading. Those that stuck with the trade room, were aptly rewarded. I can’t blame those that ran for the exits though, after that first day. They had no big picture perspective. All they knew was that they ended up negative on their first day, and in their mind, I had failed the audition.
Ironically, on my one-year anniversary, to the day (April 21) we actually won 17 ticks on the TF. Instead of being down by 17 ticks we ended that session, one year later, UP by 17 ticks. Go figure!! The Trade Gods certainly have a warped sense of humor. All jests aside though, it was a real ‘forest from the trees’ story and reinforced the big lesson that we always harp on, which is to focus on the trade plan that gives you an EDGE. SEE the Big Picture. Trade from a higher-level perspective.
The following year, the Russell eMini (TF, although it was ER2 at the time) won nearly 200 points and in fact, following a simple money management plan that we tracked on the blog during those days, resulted in a 400% gain for the year. I was proud of that, considering many a Wall Street career is built on 10% annual returns.
That was a real eye-opener. Then, markets changed and so did our tactics. What continued though, was that the trade plan’s edge kept delivering the goods; two steps forward, one-step back, two steps forward, one-step back. By merely leaning on the system, and NOT worrying about the curtain opening, the bright lights; the outcome of the next trade or how people would think and feel about the result of the trade, I was able to shift the pressure to the trade plan itself, and consequently, off of my shoulders, so long as I accurately followed the plan. Losing trades were NOT my fault. Winning trades were NOT to my credit. The responsibility landed on the trade plan itself and the individual trader’s ability to execute the trade plan appropriately.
I had been working on my own trade system and actually began using it in the trade room on my 2nd anniversary hosting and moderating the trade room. What I had learned in front of live charts, calling live trades for two straight years, not just in the TF, but also the YM, NQ, ES, and some Forex, cannot be understated. Moreover, the countless webinars, books, trainings, research, back testing, forward testing, interactions with the other NetPicks coaches and a group of excellent traders from the trade room contributed to my continued success. In fact, it was the sum of all those ongoing experiences that ended up becoming my own trade method.
One of the main things I learned, generally speaking, is that you need to have a broad perspective and a toolbox with high quality tools. Markets are ever shifting and infinitely challenging, yet there are profit opportunities that present themselves, each and every day. The trick is figuring out how to take advantage of them and having the right tools at your disposal, when you need them.
You also have to have the knowledge, belief, confidence and physical ability to know how and when to use the appropriate tools, and perhaps equally as important, when NOT to. You might have the newest and most powerful hydraulic nail gun in your toolbox, but if you haven’t taken the time to learn how to use it, it can be very dangerous. You might end up shooting yourself in the big toe, or worse!
I’ll never forget the metal shop instructor when I was in high school. He was missing fingers on both hands. Ironically, his son, Jake, was also missing fingers. I made a mental note to myself, “Don’t take metal shop!!” I took a filmmaking class instead and to this day, I still have all my fingers. That was a good trade decision!
There are tools that work on ‘most’ markets and market conditions. ‘Most’ is all we need to succeed! There are strategies and tactics that can be employed at the appropriate times that can give you a winning edge in the market. No matter how hard one tried to deny it, there is also a 10% art to trading and that can only be learned with live market experience, mentors and from excellent training. Remember, our job is not to worry about a few trades here and there. For sure, they will win and they will lose. To succeed at trading, our job is to put the odds in our favor on every trade, manage our risk appropriately, and then stay disciplined enough to let the odds do the heavy lifting over time, growing our account as a result. Like the casino! That is easier said than done, though. In order to do that, you have to take the time and effort to learn how, and that requires a serious investment – in YOURSELF! Based on my own experience, I can say that 90% of all traders fail to acknowledge or act upon that fact. It’s no surprise then that 90% of all traders end up failing.
Understanding how different types of charts work, their strengths and weaknesses, as well as the many different indicators and indicator combinations and settings, knowing the best times to trade and not to trade, using the correct money management strategies, and understanding yourself are all keys to success. Never forget that you are trading against traders that DO know this. Do YOU want to succeed? Make sure that you do, too. Knowledge is power in the war of trading. My best advice is to not take any shortcuts and to invest in yourself with solid training, live chart time, and lots of practice. Learn what the best trade tools are, and then learn how to use them. Learn when to use them. Learn how to put the odds in your favor on every trade you take and then be comfortable in the knowledge that YOU have put yourself in the BEST position to succeed. You can WIN the war of trading.