The way to learn

Learning to trade is not very different from learning any other discipline. It takes a lot of efforts and finding the right teachers. At some level of experience, the best teacher for you will be you, but before such level is reached having someone to show you the direction of least resistance is priceless.

For example, in his early years, one of the most notorious composers ever –  Mozart, imitated and mimicked the work of others. From their lessons, later in his life, he gradually builds his own unique style. This is a common path to success in music. Common path to success in trading.

In music first you learn the notes. Then you try to replay other guys’ compositions until one day you start to compose in your own unique style. In trading, first you learn the basics of supply and demand, some common market anomalies and basic market psychology. Then you read about other, already successful, people’s methods and try to mimic them until one day you become experienced enough to create your own style of trading that satisfy you financial and personal goals best. These are three different levels of expertese in each field and they should be mastered in the mentioned sequence.

Open your eyes

Seth Godin has an interesting article on finding the one, who can really help you. Very thoughtful and a must read.

“People in charge can rarely help you, because they are rarely (truly) in charge. Billionaires can’t help you, either, because they have their defense force fields on full strength during meetings like this. In fact, the person who can help you the most is almost always someone who doesn’t appear that powerful on the surface.

Remember, it’s not just that they can help you. It’s that they want to help you. Famous people qualify in neither category.

So, who is it? Hint, it’s not the Wizard of Oz or the Pope or Barack Obama. It’s someone not famous, someone who actually makes things happen and someone who actually cares. Think hard… Got it?”

Livermore on irationality

Trying to figure out the “why” of amarket move can often cause great emotional strife. The simple fact is, the market always precedes economic news, it does not react to economic news. The market lives and operates in future time.