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Hello list,
Sorry, but I just couldn't pass this one up. Every single trader that I
have ever known that is worth a damn works at least those many hours. The
vast majority of these traders (myself included) are not mechanical but
discretionary traders. Sure some of them might use some mechanical models
but for the most part they are discretionary. This means they must know a
certain amount (and often a lot) of fundamental's. This means they must
read, and think - this takes a lot of time. Reading the WSJ, Financial
Times, NY Times, and the headlines of the overseas newspapers on the
Internet every morning - before the NY markets open, then reviewing your
trading diary every afternoon (don't tell me that you don't keep a trading
journal) takes time. Reading the news articles that the news clipping
services send you every day takes a lot of time. Then on the weekends
reading Barrons, various magazines, and various think tank journals takes
time.
What takes the most time through is taking the time to put all of the
pieces together inside you own unique mental perspective so that you can
profit from this information. The big money is made in the big moves, and
big moves typically don't happen out of the blue. Likewise, big money is
unable to enter a market without leaving clues - our job is to determine
what those clues are and why.
The other day a trader asked for info on a web site that would provide
historical financial information on a certain date. To my knowledge this
doesn't exist. As another trader observed that the market moves THEN the
reporters then attempt to explain why - this is true. However, before the
big move there are often plenty of signals/news/clues/info that would
indicate that a big move was being "set up" by the big money. The saying
that "hindsight is 20-20" is very true, and it is true because after a big
move then even the idiots can figure out what the clues were. The trick is
figuring out what these clues are before the big move.
This means that you must be willing to read, and you must be willing to
read news that stretches your mental perspectives. By stretching your
beliefs about life in general and the markets in particular you are able to
grow. So, if a person thinks that trading is easy, or is something that
would be great to do because the markets are only opened for a few hours a
day then why not trade Potatoes, or Cocoa as a "day trader" then?
Successful traders are successful because they are masters of their mental
environment, their computer models are only a outward manifestation of that
mastery. They are successful because when they were becoming master traders
they spent thousands of hours studying the markets. Often they became
obsessed - they had no other thoughts but the markets. Even after becoming
successful they still spend an ungodly amount of time reading and thinking.
Spending 50 to 60 hours a week if you are a new trader is ludricious - how
about 100-120 hours a week? Then once you can actually earn doubly digit
returns for at least 5 years, then you can think about scaling back to 60
or 70 hours a week! But you say that you only want to be a technical trader?
If the amount of hours seems too high, then may I suggest that you would
have more fun going to Monte Carlo? In closing ask yourself one question,
whom would you rather perform your heart by-pass surgery - a surgeon who
loves his work so much that he spends 10 hours a week in actual surgery and
then 70 hours a week reading and thinking about his profession, or a
surgeon who loves the money and does the least amount of time studying to
remain proficient, and the majority of the time swinging a club?
Great traders love what they do, and do not notice the amount of time they
spend to remain the king of the hill - it is not work - it is actually fun!
Have a great summer guys & gals, I'm out of here till August!
Best regards,
John
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