May 21st, 2011
Core thoughts compared to variable thoughts:
Your core thought process in trading is the most important part of your trading. These are the thoughts that you do not even need to think about. Just like when you see a red traffic light your foot automatically lifts off the gas pedal and goes over to the brake pedal. This is one of your core thoughts of driving.
Your core thoughts should be visual on your charts as well as being embedded in your mind.
Core thoughts:
*The clear direction you should be trading.
*Where your stop is located
*Exit strategy based on which type of signal
Variable thoughts:
Just because you know the direction of the market does not guarantee you will make money. This is why we teach how to read the condition of the market and how to know if the market is in minor or major waves. Most traders get stopped on the minor wave before the trade even had a chance.
Variable thoughts are what need to be fined tune over time. Our course digs deep into the variables of the markets. You think just because you know what an ABC pattern looks like you will make money every time the ABC happens? The question is not “Is this an ABC?” the question is what happens after the ABC?. Where is pattern completion? Where are the odds on the bigger time frame?
What is the odds of the ABC completing or failing? Did you know that there are just as many patterns that fail that complete?
Is this wave #2 high or B high short? The only way to answer this is to know what to look for off an A low and without understanding the core thoughts the variable thoughts will always seem random. Why did the ABC work this time? Why did it fail?
Most traders will benefit more learning the variables because once you understand the variables the core is automatic. We tell all of our members too look deeper into each thought and go with the thoughts into stage 3 and 4 and not get hung up on the 1st more obvious questions.
The variable thoughts and methods are how you make money. The obvious core thoughts are just that obvious. Think back on your trading and ask yourself. “When I went long a breakout at an obvious high was it a easy trade to hold? Did I make money on it? Did I hold the trade long enough to make the true risk of the trade worth it?
Variable odds give you a way to flow with the market so you are not fighting it.
Variables are:
*Patterns
*Multiple Time Frame Patterns
*Failure of patterns
*What pattern has the highest odds of occurring after the current pattern completes
*What the chart should look like the night before
On average most traders still say that even when they make money it still feels random to them. Think about that for a minute .How crazy does that sound?
Happy Trading,
www.eMiniSchool.com
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