As a trader, there is nothing more fulfilling than watching a trading plan play out exactly as you designed it. As an educator, it is equally exciting to watch a student plan a trade and then watch that plan unfold, step by step, as the student artfully executes it. Let me take you step by step through a recent trade by one of our students at Market Geometry:
During a live session a few Monday’s ago, we drew out the following map of the 240 minute $USDAUD [the Australian Dollar against the U.S. Dollar]:
Timothy Morge and Shane Blankenship will be hosting ‘Building a Professional Trade Plan’, the first in a series of Seminars focused on teaching you to ‘Treat Your Trading Like a Business’ on October 22nd, at 12 pm MST [-7 GMT].
Tim and Shane have personally coached hundreds of professional and novice traders. Those that have excelled all had the following few things in common: The ability to keep an up to date and accurate Trading Plan, solid Risk Management skills and detailed Trading Journals.
Some of the topics covered in the ‘Building a Professional Trading Plan’ seminar will include:
• The importance of trading with a plan
• The Philosophy behind a successful Trading Plan
• The what, how and why of Trading Plans
• How to turn your thoughts, step by step, into a Trading Plan
• What Professional Traders Include in their Trading Plans
• Risk Management
• The Beginning of a Trade Plan: Beginning to use Excel for your Plan
• Building simple but powerful metrics that are a must in your Trading Plan
• Record keeping of those metrics
Each attendee will get access to copies of the Trade Plan examples we build during the session. Additional examples may also be available for download after the session.
Approximately six to eight weeks after the seminar, each attendee will get a DVD of the seminar. Shipping and handling anywhere in the world for attendees is free.
The price for the ‘Building a Professional Trade Plan seminar’ is $749.00, including a full length DVD, copies of the Trade Plan examples and shipping and handling anywhere in the world.
At today's free Monday Mini-Mentoring Session Tim focused on several topics centering around money management.
Money management is a skill as important as the Market Maps trading methodology Tim and Shane teach. If you weren't able to attend this session it is strongly advised you review the recording before it is removed on Wednesday, October 13. The purpose and use of each of these spreadsheets as well as some real life examples of the benefits these worksheets bring to your trading business.
I was asked earlier this year by several elementary schools to teach the basic of trading to their gifted students; one of the students happened to be my eleven-year-old son, Sean. The students competed in anational stock trading contest that ran from mid-January through late-April. The students could only be long stocks and each school had a team (since these were only the extremely gifted students at each school, the groups were small—three or four students per team, on average). I taught them a simple charting methodology (I called it “crayon drawing” because it was based on market structure and simple lines—no indicators were used—though the use of strict money management was featured prominently each time we met. I refused to give them trade ideas, nor would I tell them where and when to get out, profit, or loss. I would point them, using questions, to a line of reasoning that would allow them to find the answers they needed themselves. I am proud to say that three groups I helped all finished in the top ten in the country. The two in Illinois finished third and fifth, and the school system in Arizona—where I now live—has not yet given me permission to release any information more specific, but the Arizona team finished in the top ten as well.)
My first impression? We should have ten- and eleven-year-olds manage our retirement money! The three groups averaged a 12.4% non-annualized increase in the value of their trading account over that short period of time, using no leverage and only being able to be long stocks. They set their maximum risk to no more than 20% of their account on open positions, though they never approached this level of risk. One of the main tenets in my own trading, and one of the things I insist upon when I mentor other professionals is that stops are always in place the moment a position is put on, as well as logical profit targets. I taught this to the students and they practiced it religiously.
One of the most rewarding and challenging things I have done in my 40-year trading career is teach elementary school students the basics of technical analysis and how to apply those basics in order to make money trading stocks. Each student comes to the trading class with a fairly clean slate: They don't know much, if anything, about the markets and they don't carry any of the emotional burdens of having to make “real” money to pay the rent or buy food. They soak up what I am willing to teach, which is a delight, but once they soak it up, they roll it around in their heads and then ask some of the most thought provoking questions!
When starting with an unmarked chart of a stock, I often point out market structure: Swing highs and lows,ranges, double or triple tops or bottoms, and gaps. On one particular afternoon, I started with a chart and began marking out simple market structure, and after a few minutes, the questions began. Why did I place any significance when price gapped higher or lower? Did it matter if the gaps remained unfilled or were all gaps the same? If gaps are important, how can you use them to make money?