The group study program is our sharing of the market knowledge from the tested sources and eliminating the ones that  do not work in the markets. We have a vast library of  research resources worth over $50,000 accumulated over a long period of time.

Trading systems work or fail as a function of consistency and implementation. There is a serious lack of information available on implementation of a system. On the other hand there are thousands of places where systems are sold. They all promises to work. Will they work? We seriously doubt it. Why? You will find this out in the lines below.

The idea of this program is to allow you to understand market behavior and trading related behavior. This area is underserved.  Most of the losses in the markets can be recognized to be from the emotions of fear, greed and/or hope. Of all three of them Hope is the destructive emotion in the markets. Hoping that riding a losing position will turn into a  winner. Rule number one is not to ride the losing position for serving the emotion of hope. Fear is the second emotion what keeps us from entering the markets at the right time and holding on to the winning positions when the market temporarily moves against us.  Greed is holding on to the winning positions when they should be closed out.
There are three basic rules when trading a tested system over a period of time. 
1. Cut the losses short.
2. Run the profits.
3. Take trades in the direction of the signal.
We have discussed the first two problems related to the emotions. Third one is also very important to understand.  You have too many inputs- news, commercials, news, more news, financial news, economic news, bad news, good news and all the news we hear represents the past and does not have any predictive value. This is the danger of information overload. We live in a world full of events and we have access to tons of it. The reality is that you can only focus on a limited number of things with your conscious mind. The conscious mind is only capable of handling 8bits/second of information. Any information more than that will be filtered. As an example, right now there are a lot of other things happening around you. Sounds, sights, smells but you are only focused on one at a time. Take this fact to your trading and if you mix your signals with news and other sources, you will not be trading any one them. So you need to focus on what you want to trade. In this case, you are paying us because we are your trading advisors. The choice is yours. There are things that you can do mentally if you focus with discipline to what you want to do. The bottom line is that too much data, opinions and inputs will divert you from your trading goals. What you need is discipline. These are the introductory reasons.
This one aspect of the multidimensional strategy towards the markets- YOU as a trader. The other reasons to consider are what you call systems and money management. All three are important while trading the markets.
Dimension number two is a system. To trade the markets you need a system which has positive expectancy. What is positive expectancy?
Expectancy = (Probability of Win * Average Win) - (Probability of Loss * Average Loss)
As an example let’s say that a trader has a system that produces winning trades 30% of the time. That trader’s average winning trade nets 10% while losing trades lose 3%. So if he were trading $10,000 positions his expectancy would be: (0.3 * $1,000) - (0.7 * $300) = $90. So even though that system produces losing trades 70% of the time the expectancy is still positive and thus the trader can make money over time. You can also see how you could have a system that produces winning trades the majority of the time but would have a negative expectancy if the average loss was larger than the average win: (0.6 * $400) - (0.4 * $650) = -$20. In fact, you could come up with any number of scenarios that would give you a positive, or negative, expectancy. The interesting thing is that most of us would feel better with a system that produced more winning trades than losers. The vast majority of people would have a lot of trouble with the first system above because of our natural tendency to want to be right all of the time. Yet we can see just by those two examples that the percentage of winning trades is not the most important factor in building a system. As Dr. Van K. Tharp points out-… your trading system should have a positive expectancy and you should understand what that means. The natural bias that most people have is to go for high probability systems with high reliability. We all are given this bias that you need to be right. We’re taught at school that 94 percent or better is an A and 70 or below is failure. Nothing below 70 is acceptable. Everyone is looking for high reliability entry systems, but its expectancy that is the key. And the real key to expectancy is how you get out of the markets not how you get in. How you take profits and how you get out of a bad position to protect your assets. The expectancy is really the amount you’ll make on the average per dollar risked. If you have a methodology that makes you 50 cents or better per dollar risked, that’s superb. Most people don’t. That means if you risk $1,000 that you’ll make on the average $500 for every trade - that’s averaging winners and losers together. In short, you need a system which have bigger average profits then losses. You need to trade a system that is tested over a period of time. Although there is no guarantee of profits with any system including ours, swing trading system we use gives us the edge in the markets. 
The third and the most important dimension in the markets is your money management. How do you use your account size to calculate your position size in the markets? Look at the part of a snowball fight metaphor that Tharp uses in his book:  Imagine that you are hiding behind a large wall of snow. Someone is throwing snowballs at your wall, and your objective is to keep your wall as large as possible for maximum protection. Thus, the metaphor immediately indicates that the size of the wall is a very significant variable. If the wall is too small, you couldn’t avoid getting hit. But if the wall is massive, then you are probably not going to get hit. The size of your initial equity is a little like the size of the wall. In fact, you might consider your starting capital to be a wall of money that protects you. The more money you have, assuming all the other variables (the components of expectancy listed above) are the same, the more protection you will have. Now imagine that the person throwing snowballs at you has two different kinds of snowballs — white snowballs and black snowballs. White snowballs are a little like winning trades. They simply stick to the wall of snow and increase its size…. Imagine that black snowballs dissolve snow and make a hole in the wall equivalent to their size. You might think of black snowballs as “antisnow.” Thus, if a lot of black snowballs were thrown at the wall, it would soon disappear or at least have a lot of holes in it. Black snowballs are a lot like losing trades — they chip away at your wall of security… Tharp continues walking the reader through different scenarios and possibilities. Like considering the relative sizes of the snowballs of each color. What happens to your wall after being hit by some black boulders of snow? Or considering how the rate at which snowballs are thrown affects the wall. You can see how important each aspect of expectancy is as well as the huge importance of both the amount of equity (the size of your wall) and position-sizing (which will determine the size of the snowballs). Expectancy, position-sizing and other aspects of money management are far more important than discovering the holy grail entry system or indicator(s). Unfortunately entry techniques are where the vast majority of books and talking heads focus their attention. You could have the greatest stock picking system in the world but unless you take these money management issue into consideration you may not have any money left to trade the system. Having a system that gives you a positive expectancy should be in the forefront of your mind when putting together a trading plan along with an excellent money management along with the psychology to trade both.  This introduction is not complete without explaining the concept of R-Multiples. R is simply the dollar risk per trade. It’s nothing but a reward-to-risk ratio. Dr. Tharp reveals the great secret of trading: The golden rule of trading is to keep losses at a level of 1 R as often as possible and to make profits that are high-R multiples. You often hear (read) that traders should only look for trades with a risk/reward ratio of at least 2 or 3 to 1. Expressing your results in terms of how many times your risk allows you to easily see how well your trades measure up to such a standard. So when you look at your results in terms of multiples of R, you can easily tell how good or bad the trades were. We like to think of R-Multiples as telling us the efficiency of our system.

So why not just use dollars?

Expressing results in dollars would achieve the same result if always risked the same amount of money. But what if you triple the account and therefore trade larger positions compared to when started trading? Or what if hit a rough spot and decide to cut lot size down while ride out the storm? Then the dollar results won’t easily tell how trades from one period of time compared to another period of time. But if used, R makes such comparisons simple. Either trades pass the risk / reward ratio test or they don’t. The actual number of dollars at risk doesn’t matter, how many multiples of the dollars at risk does. Talking and thinking in terms of R-multiple when you discuss about profits is an excellent approach - that by itself makes you focus on risk and money management - the actual “grail” to successful trading. That is a very important point. Whenever you see people posting dollar returns, especially losses, that are all over the place the first thing ask yourself and wonder what the risk per trade is. It’s almost a certainty that those traders aren’t focusing on risk and as a result keep having huge losses. The mere fact that you have to define R and then place a stop to keep your loss to 1R is probably too constraining for those gamblers traders. Dr. Tharp says about determining your initial stop-loss point as soon as you enter a trade, which, by definition woud give you a 1 R loss: This principle is so important that if you cannot follow it, then you might as well give up the idea of electronic trading right away. It makes it easy for people to figure out what they could have made or lost on a trade with their own account size and risk per trade amount. If you see a trade that returned 3R all one has to do is plug in their dollar risk per trade to figure out what they could have made / lost.

Trader A thinks that R is just some made up number and could mean anything. He likes “real” numbers. While it may be fun to see that somebody made $10,000 on a trade that in and of itself doesn’t tell you how good that trade was. What if that person risked $30,000 to make that $10,000? Or what if they risked $1,000 to make that $10,000? Those are two very different trades. Sure they both made the same amount of money but isn’t the second trade a much more efficient use of capital? What if somebody is trading $500,000 lots to make $1,000 in profit? It may be nice to see somebody saying that they made $1,000 here and $1,000 there but damn(!) that’s an inefficient use of capital. So while R could mean anything in terms of dollars, what really matters is how many multiples of R were made or lost. That tells you the quality of a trade or system.

Trader A states that if he reported his trades in terms of R he could appear to be a good trader. Sorry to tell him that’s simply not the case. If you lost money that means your expectancy, which is just your average return expressed in R-Multiples, was negative.

Trader B said that “R values are subjective and don’t give you a true idea on how successful the trade was”. That is exactly wrong. R-multiples are the very thing that tells you exactly how successful a given trade was, if you choose to grade on a risk/reward basis. So how can we make the results clearer? Simple, express them in percentages. That way, regardless of how many shares were traded or the prices of the stocks traded the results can be equalized across all the trade. Looking at the percentages makes those kind of comparisons easier. R-Multiples do the same thing for traders. They can accurately compare their own trades and they can take another trader’s results expressed in R and easily relate them to their own system. For example risking 2% per trade is R and reward will be more than R.

Re read the Introduction to grasp the three dimensions of trading.

TASK: Reading from the study material
Please read Chapter Four Mind- The Disciplined Trader (pages 52-66), from part 2-THE THREE M’S OF SUCCESSFUL TRADING.

quote from page 58- " to be a successful trader, you must accept total responsibility for your decisions and actions."
UPON COMPLETION: Email us after you read the chapter with your comments. A discussion on the topic of trading psychology, role of NLP in trading, Mind as a tool in trading will start soon.

Most of the traders who come in the markets have a dream of making a million dollars and making it as fast as they can. Let us study two traders who have done it in different spans of time. One of them is Larry Williams. In 1987 Williams won the World Cup Championship of Futures Trading, sponsored by Robbins Trading Company, trading $10,000 in real money to $1,147,000 in 12 months – a feat no one else has come close to matching. It was a wild year, as Williams ran his winnings to more than $2,000,000 by the end of September, dropped down to $750,000 after the October ‘87 crash, and traded back to the $1,147,000 mark by the end of the year. Ed Seykota turned $5,000 into $15,000,000 over a 12 year time period in his model account - an actual client account. Ed is self-taught, but influenced early on in his career by Richard Donchian. He is a commodities and futures trader and a Trend Follower. Who would you like to be? 1 Million in one year or $15 million in $12 years? We have seen the transactions of Larry William’s account. The question is are you able to take such drawdowns? A drop from $2 Million to $750,000. Are you able to take a drawdown of $10,000 or $20,000.  NFA fined Larry Williams for not reporting to potential clients that, while his personal account in a promotional 1987 contest was very profitable ( a gain of + $902,599 ), his managed accounts for clients lost substantial funds ( - $6,122,281 ). This constituted deceptive and unbalanced promotional material and disclosure statements. Details in William Gallacher’s book . The reason for discussing this is not to question the abilities of Larry Williams but to understand that his story might not be suitable for your trading goals due to two reasons. One, it is not black and white and two even if it is black and white, Larry had years and decades of experience behind him before that world record and for a new trader just entering the trading arena or someone with lesser amount of knowledge and skills, it is almost impossible to break a world record! We hope you understand our point of view.  Let us study the other case- Ed Seykota. He is one of the turtle traders. His span of making that sum of money is over a decade. Are you willing to commit for a longer span of time for learning, skill developing and trading the markets? All these top traders work with a system that works 40%-50% of the times. The trading secret and the holy grail behind the working of these systems are the traders themselves and creative money management. This is what we are going to discuss in the online forex study program. 

What do you do when you see a forex signal from the system or with the daily forex signal forecast? What are your trading goals and how do you react to the forex signals? There has been studies where NLP or Neuro Linguistic Programming has been used to create anchors using techniques of NLP.

It works like this. You see a signal, feel good about it, take it. (This is of course when you have tested the entry and exit strategy and are not able to trade the system.)

If you go to the forexforecasting.com main page you will see the information on why you need multi dimensional holistic approach in the forex trading.

Welcome to an exciting new trading spirit! The study group will start from the second week of October, 2007. The password to the study group will be sent to the members next week.

If you still have not taken the forex skills test, please do it now and send us the results.

Here is a simple test that will show your current trading skills in the forex markets. Follow the instructions below. Select category A, B or C and be honest with yourself. Remember, whatever you select will determine how you can increase your chances of success in the forex markets.

A. If you are a gross winner in the markets in the last three months, congratulations and we are really impressed. Send us your future goals and we will send you the details of how we can help you further to achieve your trading goals.

B. If you have been breaking even in the markets for the last three months, here is a good news- you have a good chance of success in the markets. Send us your trading record for the last three months and we will send you a questionaire similar to the one used by top market coaches. Fill it and send it back.

C. If you have been a gross loser in the markets for the last three months or a new forex trader (there are 90% chances of that) , we have a good news and a bad news. keep reading………..

• Bad news is that you have to suspend all real time trading activity in your account with immediate effect.
  
• Good news is that YOU HAVE BEEN CHOSEN TO GET ONLINE TRADING COACHING AT NO EXTRA CHARGE!  start working with us on a demo account without risking your own money till you gain confidence in yourself and your trading results. 
• Read all the information in the member’s area. 
• Email us and we will congratulate you for being honest and as a token of appreciation will send you a free e book. Read it, join the study group category in the blog and attend it regularly.
  
• YOUR GOAL : MOVE UP TO CATEGORY B IN THE NEXT SEVEN MONTHS OR LESS. LOVE IT, LIVE IT AND GET IT!
  
• Email us at support@forexforecasting.com for your instant e book. TAKE ACTION NOW!

Excited?! NEW TO FOREX OR AN EXPERIENCED FOREX TRADER- THIS BLOG IS FOR YOU. This is a brand new blog with lots to share. Trading is a lonely game and all of us need support. This forex blog will help you with the spirit of forex education, goal orientation, trading techniques and most of all building a trading personality within your self. Forexforecasting.com was created five years ago in 2003 and since then has been empowering traders around the world in over 60 countries.  This blog is a part of our on going research and transformation over the years. As your registered commodity trading advisor, it is our responsibility not only to give you forex signals and analysis but also professional trading advice. In fact only using and working with the signals will not generate results in the markets. That is why two traders with same entry and exit methods will produce different results in their trading.

It is a known fact that 90% of the traders consistently lose money in the forex markets. To make money in the markets, you need to be in the top 10% of the game. Our goal here is to provide you with the tools required for this achievement. Do you need this service? The answer is- either you can invent a light bulb or you can get a light bulb. The choice is yours. Of course it will take lot longer and cost way more to invent the light bulb. Common sense is if you are sick, you go to a doctor.  If your car is troubling, you go to a car mechanic. If you need food, you can buy it or grow it.  Would you go to a registered trading advisor for trading advice? At every point in life there are two choices. Likewise, there are two choices in the markets also- these choices are to buy or to sell. Easy choices? Not really. Why? Because doing one or the other does not guarantee any profits. Trading needs commitment, persistence and a strong desire for success along with proper training, mentoring, guidance and coaching from the right source.

As a member, you have access to the blog, forex signals, money management tools and trading psychology exercises. These are the tools that will help you learn how to trade the forex markets. These are the same tools successful traders use all over the world. Until now there has not been a single forex service on the web which provides a holistic approach towards the markets including online coaching. This service will provide value to its clients. You will pay a fortune for similar services elsewhere- ten, twenty or even fifty thousand dollars depending on where you go. This service will provide you with the daily market analysis in four major pairsEURUSD, GBPUSD, USDCHF and USDJPY. It will provide you with risk management and money management tools. Money management simply means how much to risk in any given trade after a loss or a profit. It will provide you with trading psychology and developing a trading personality. All these tools are based on top trader models. We have spent over five years in gathering these tools for you from top trading sources, market psychologists, trading coaches and top traders around the world. So be confident and welcome to forexforecasting.com

If you are not committed at this time, please reconsider your decision to trade the forex markets. This market requires commitment. 

DISCLAIMER: During the course of coaching, you will be provided with study material from outside sources and well as forexforecasting.com. Forexforecasting.com is not responsible for any actions or representations by those sources. The coaching does not guarantee that you will make money in the markets and is educational in nature. forexforecasting.com does not guarantee results or success, and you agree that you alone are responsible for your own results, successes, and failures. Internet communications cannot be guaranteed to be secure or error-free as information could be intercepted, corrupted, lost, destroyed, arrive late or incomplete, or contain viruses. Therefore we do not accept responsibility for any errors or omissions that are present in this message, or any attachment, that have arisen as a result of internet including e-mail transmission. In addition, a complete disclaimer and CFTC required disclaimer applies to all the services and products of forexforecasting.com

 
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