Task 5 of the Hercules Challenge. The 7 Pillars of Success By Lance McPherson. 1. Proper Preparation - Get the trading schedule - Be 100% mentally “ON” for the trading session - Trade plans ready - Profit and Loss targets set for the trading session.
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The 7 Pillars of Success
By Lance McPherson
1. Proper Preparation- Get the trading schedule - Be 100% mentally “ON” for the trading session- Trade plans ready- Profit and Loss targets set for the trading session
Why is this pillar important to my Trading SuccessTo be prepared is vital to my success as a trader. When I am prepared, I am setting myself up for success. Being prepared helps me to focus on what I need to do, before and during the trading session. The market does not jump up and down to alert me of any trading opportunity. It’s my mental focus and preparation that allows me to see these opportunities and to take advantage of them.
An example of the pillarBefore I begin to trade any session, I have to be ready for the trading session in advance. The most important and first task for me, is to make sure that I am mentally prepared for the trade session. I start by meditating. I get myself into a calm and relaxed state of mind. I then visualize the market. I see the market moving into the put or call trade zones. Then I walk myself through my trade plans. 1. Are the prices near longer term support or resistance -NO2. Are prices in or near congestion - No3. Are the prices over extended – No4. Are the prices near the previous day’s high or low - NO5. Are there any reports or announcements - NO6. Are there weekends or holidays – NO7. Is the price activity True or False – True Then I see good momentum moving in my direction and I pull the trigger.Once my visualizing is done, I ask myself a few questions.
How am I feeling?If I’m sick or feeling down or upset. I will not trade that session, because I will not be 100% focused.If feel good and focused, I move onto the next questionAm I ready for the trade session?Yes. Why?Because I am focused on the process and not the result.Why am I trading?To better my family’s lives. This normally keeps me focused, because I know I have people counting on me to succeed.I normally do this for 10 minutes in the morning when I wake up, because there are no distractions. This mental process is part of my daily trading schedule. I also have 16 points that I read before I start trading which I also part of my trading schedule.
These 16 points are mistakes that I made in the past and going through these points keeps me focused.1. Do not trade during announcements.2. Only trade in the trades zones3. Only place one trade at a time.4. Do not rush your trades. Be patient5. Do not place a trade immediately after a strong move down or up. Watch out for congestion 6. Maximum of 2 trades per day. 7. Do not enter trades too late. 8. Do not make spontaneous trades. 9. Always trade to the nearest 00 or 30 of the hour.10. Do not place a trade under 10min.11. Select the correct expiry time.12. Do not trade against the trend. Wait for proper confirmation of the trend reversing. 13. Before placing a trade, check the cross rates for a double confirmation of the trend moving in your favour. For instance, If you want to place a trade on EUR/JPY. I need make sure that the USD/JPY is moving in the same direction, as the other JPY crosses. Also look at the EUR/USD to see if it is also moving in the same direction and that there are no support or resistance areas that could stop the EUR from moving in your favour.15. Be consistent (stick to the trade process and risk management).16. Trade without fear. You use probability to trade.
I print out my trade plan sheets (PUT and CALL)
I print out my daily trading summary
I print out my trade analysis worksheet.
I set my profit and loss targets for the trading session.Maximum of 2 trades per day 25$ trades only. This is what I’m prepared and happy to risk per trade. I check my trade analysis and I draw my trade zones, I also mark out any support and resistance areas.I also keep my trade journal close by. Immediately after a trade, I make notes in my journal about the trade, for example, I lost this call trade, because of resistance stopping my trade from moving up. I took a trade on the GBP/JPY, but the chart of the GBP/USD shows resistance. Before placing a trade, make sure there are no resistance areas on the other cross rates. I also add the date in my entry. Making these notes immediately is important. It just makes it harder to go home at night and recall the mistakes I made.
2. Hard Work- Put in the effort to learn the skills of my craft- A minimum of 30min. Personal Development everyday- Trading skills/Mindset/InspirationWhy is this pillar important to my Trading SuccessHow do traders become great? By learning and mastering their craft. They do this by learning every day. You cannot wake up one day and be great at anything. You have to put in the work. I do at least 1 hour of personal development a day. It is really important for me to learn trading skills, trading mindset and inspiration. Giving up my time to learn, builds my character. It makes me responsible for my actions. If I don’t learn, I rob myself and waste my own precious time. While others are watching TV or sleeping or having fun, I’m busy doing what 95% of people will not do. I learn, I make a commitment to myself to do my studies every day until I’m done, no matter what. Learning my trading skills allows me to see advantages in the market that others cannot see. Learning to have a trading mindset is vital to any trader’s success. This mindset teaches me how to think like a trader. When it comes to making money traders think differently. This is where I learn to see the market objectively. After a few losses you might think that the market is against you and you feel like giving up, but having a trading mindset and learning inspiration is what keeps me from giving up. Inspiration teaches me that, I’m the only one that can change my life. I have to take responsibility for my action, in trading and my personal life. Trading is very taxing, but if you have a strong belief system, you will make it and become success.
An example of the pillarLearning the skills does not entail hours and hours of learning in a day. All it takes is at least 30min a day. I log in to http://www.thebinaryoptionsexperts.com/start-here
As a beginner, this is where I will start.I do 1 hour of personal development every day. I do 30 min of trading skills or trading mindset and 30min. of inspiration. I normally break this up. I will do 30min. in the morning and 30min. in the evening. If I cannot do any learning in the morning, then I will do the full hour at night. When I sit down to do my personal development, I make sure that I am not distracted. My goal is to learn, and not read. I make notes and implement what I learn immediately. If there is no trading for the day, I will push my trading development to 2 hours.
3. Patience- Only trade when the trade plans are met- Wait until the trade unfolds before you – Don’t force a trade that is not there.- Be the CHEETAH…. Only take the easy trades.Why is this pillar important to my Trading SuccessYou have to have patience to trade. I cannot look at the market and guess which way the market is going to go. I need to follow a process and this process requires patience. This process allows me to wait for a trade to unfold before me. These are the cheetah trades. The processes I follow are in my PUT and CALL trade plan sheets.
An example of the pillarTo explain patience in words is as easy as saying, just wait. Easier said than done. However, patience is something you have to learn for yourself. This is learnt by being in the market and following your trade plan. The trade plans that we use, lets you know what to look for when you trade, when you see a trade setup. You need to keep in mind that every trade is not the same. It might look like a similar trade that was taken before, but the market is unpredictable. We use probability and being patient could be the difference between winning and losing.
Let’s take a look at the above screenshot.Most novice traders would have taken this trade at the red arrow, just because the market was in the call trade zone. I know this because I made this mistake a few times. You need to wait for the market to confirm the trend reversal. Our more experienced traders would have taken this trade at the yellow candle, because there was a support level at this area on a longer time frame. The momentum going up was good, and they took the trade. I did not take this trade at the yellow because there was a resistance level, marked by the red rectangle. I wanted to see the trend move past that resistance area. Once the trend moved past that area, I waited to see the market move back down, as you can see the red candle just in front of the blue arrow. Then I waited for the market to move back up and that confirmed the trend reversal for me, I took the trade.
4. Have a Detailed Plan- Print out trade plan sheets- Complete the trade plan sheets for every trade as you work through the rules- Complete your trade journal for every tradeWhy is this pillar important to my Trading SuccessPrinting out my trade plan sheets, means, that I have my trade steps right in front of me when I’m about to place a trade. This means I have no excuse of not following it. As I trade, I use a pen to mark each trade plan step as I work through them. Once my trade is done, win or lose, I complete my trade journal, while everything is still fresh in my mind. My trade journal allows me to review my trades at night and go through any mistakes made during my trading session. My detailed plan also includes my profit and loss targets for the day.
An example of the pillarI will print out my trade plan sheets before I even look at the marketAs you can see in the screen shot above, there are check boxes next to each trading step.When you are about to look at a potential trade, use a pen and make a tick in the check box as you work through the trade plan sheets. If there is any step not met, mark the check box with an x and don’t move to the next step. We only place trades once all the trade plans are met. Do this process for every potential trade.
I also keep my trade journal close by. Immediately after a trade, I make notes in my journal about the trade, for example, I lost this call trade, because of resistance stopping my trade from moving up. I took a trade on the GBP/JPY, but the chart of the GBP/USD shows resistance. How do I put a process in place so that I don’t make this mistake again?Before placing a trade, make sure there are no resistance areas on the other cross rates. I also add the date in my entry.
5. Discipline- Do the Work- Be Patient- Follow the trade plans and the 7 Pillars of success- Do Personal Development every day- Do what 95% of people will never do, so that I can have what they will never haveWhy is this pillar important to my Trading SuccessDoing the work means that I have to get into the members area every day, and learn the skills necessary that will take my trading skills, mindset and self-belief to the next level. Having patience is the difference between winning and losing. The way I practice patience is by being in the market every day and by learning to have the mindset of the best traders. This is a skill that has to be learnt, patience cannot be taught to you. You have to change your mind set in order to be patient. I follow my trade plans and the 7 pillars to become successful in the market. Discipline also entails working on your financial management. This is the percentage I set to trade at the beginning of each trading session. This is a percentage that I am happy to risk in the market. I make sure that I am in the members area every day putting in the time and effort to educate myself by doing my personal development, while others are sleeping, watching TV, going to parties, I am sacrificing my time. This is how I do the things, that 95% of people will not do.
An example of the pillarHow to do the work? Simply put, You need to educate yourself and finish what I start, no matter what. Take responsibility. If you have to finish what you start, and you need to be accountable.Login to the members area everyday and learn. http://www.thebinaryoptionsexperts.com/start-here
If you say that you are going to complete two chapters of trading in the zone every day, then do it. Sacrifice the time, the favorite TV show or sleep to get to where you want to be. Do it until it’s done, Doing the work also means, you need to print your trade plans sheets, fill in your trade journal, stick to your profit and loss targets, follow your trades to the letter and the 7 pillars of success and having patience. When I say patience, I don’t just mean patience to follow your trade plans. Look at trading as a business, not gambling or a get rich quick scheme. Trading is about being consistent. You need think long term. We all don’t have millions to start trading. Most of us only a few have hundreds or thousands to start off with. Build your trading balance first, before you think about spending. Where do you want to be in the next 2 to 3 years?Look at where you want to be in the next year. For example:I want to build my trading balance to have 10 000$ at the end of the year.
Break down20$ x 2 = 40$ a day40$ x 5 = 200$ a week200$ x 4 = 800$ a month800$ x 12 = 9600$ a yearYour personal development is important, so do it every day. If you are tired of the way you life is going, then change it, stop complaining and take responsibility for your actions. This is how you will have, what 95% of the world’s population will never have. The road to mastery is by doing a little bit every day. You have to challenge yourself; this is how you will grow. Do the things that other’s won’t. Remember to make notes as you do your personal development and look at implementing what you learn in your life immediately For Example:
Today I did 30 min of Robin SharmaYour Perfect DayDay 11Get up earlyGive yourself a 30 day challenge to get up at 5amGet a calendar and mark the days when you get up at 5.Getting up early is a win. This is a psychological edge.If you want the power, you need to do the act.Do what's difficultThis will give you more time, to work on your mind, body, or spiritThe things that get scheduled, are the things that get doneExercise in the morning to get your day startedDietA good diet will affect your energyDrink enough water.Eat 6 small meals a dayDo what needs to be done in your careerBe better than the day before. Be the best you can be at work or business.Respect others and treat then well. Build relationships. Be humble
Spend time with your familyDo a daily de-brief before you go to bed.Write about your day, write about what you did right or what you could have done better.Write down 5 good things that happened to you todayDoes not matter how big or small, this gives you time for gratitude.Read something positive before your go to sleep.Your days are your life in miniture.Action StepsThink about the best day you had in the past 5 yearsWrite about your own perfect day.Have a conversation with someone about their perfect day.
6. Communication- Communicate with yourself- Communicate with my accountability partner- Communicate with the accountability group- Communicate with my trading mentor- Ask questions if I’m not sureWhy is this pillar important to my Trading SuccessCommunication lets the world go round. Without it, there is not much that will be accomplished. To communicate with myself is so important. I need to make sure that I have a strong self belief, so I need to watch what I say to myself. I need to uplift and motivate myself. Self talk is very important. I communicate with my accountability partner about what I will accomplish for the week ahead and that is a promise that I have to keep. It keeps me accountable. I also communicate to the members in the accountability group about what I will do for the week, and I login everyday to let them know what I did for the day, and what I learnt. Communication with your mentor is vital. You mentor is there for a reason. They keep you accountable for what you need to do, and they help you with areas that you are having difficulty with. If I’m not sure, I will ask questions. The accountability group or mentor will be able to assist. This is a group of like minded people who want me to succeed.
An example of the pillar
7. Review- Review trades daily, weekly, monthly- Review 1-3 crucial focus areas every week- Review my progress and achievements- Review your trading journal- Review mistakes and implement a plan or process to eliminate themWhy is this pillar important to my Trading SuccessReviewing on a daily, weekly and monthly basis is important to my success as a trader. This allows me to go over my success and failures that I made during the trading day, week or month. The screens shots and trading journal keeps me focused on what worked and what mistakes I made during a trading session. There are no losing trades, just lessons. Failures are part of growing and by reviewing my failures and focusing on my 1-3 critical areas, will ultimately move me closer to my goal of becoming a professional trader. As I review mistakes made, I implement a plan or process to eliminate these from my trading
An example of the pillarGo through your trade screen shots and your trade journal every night after a trading session. Ask yourself, if you followed all the trade plans, and if the trade entry that you made, met those trade plans. At the end of the week, you need to go through all the trades again and read all the notes that you made in your trade journal. Review all the mistakes made and implement a plan, to not do them again. Go through your winning trades and implement a process that you can use, to repeat these trades. You also need to review your 1-3 crucial focus areas, like, do I need more work on my trading mindset or my trading skills or inspiration. I normally like making my notes on my trade screen shots. Make screen shots of the longer term charts as well. This will give you a better view of mistakes that you cannot see on the 5 min chart. If you don’t know why you lost a trade and you are certain that the trade met all the trade plans, look at a longer term time frame you might see the problem there.