A Telepath Trader Reality or Myth

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A Telepath Trader: Reality or Myth

In trading, you can’t rely only on your gut. Every beginner, who has ever tried to close a trade without proper market analysis, know this all too well. However, the wild success of traders who earn tens of thousands of dollars daily begs the question, do they have some kind of psychic ability? Some spend years trading and fail to earn more than their initial investment, whilst others become millionaires over the course of several years. Is there something more to their success than simply a better understanding of trading and vast experience? In this article, we will discuss whether there is such thing as a psychic trader, or if it is just a myth spread by those who wish to justify their trading failures.

So, the majority of us have heard of the most famous figures in trading, such as George Soros, Nick Neeson, Bill Williams, and many others whose overall wealth amounts to tens of millions of dollars. How did they manage to reach such lucrative financial heights, and what is their skill lies not in market analysis, but telepathy?

From the beginning of time, humanity has accused things they don’t understand of being magic or something supernatural, which is why, during the Inquisition, not only were a large number of beautiful women burned at the stake, but also many talented minds. And although these days we live in a modern world with nanotechnology and artificial intelligence, the instinct to call anything we can’t explain mystical re-emerges every time. Such as, when we can’t explain some kind of event, or even if touches on someone’s astounding success in specific professions like trading. On the contrary though, if you take a closer, more objective look, even the financial successes of millionaire-brokers have better, more tangible explanations. So, let’s assess why it is possible to be a professional without any psychic abilities.

The Simplest Approach is a Complex Forecasting Mechanism

In the context of this approach, futures contracts, as a financial tool, are clearly the simplest. When closing a trade, you only need to set three conditions, the sum, the expiration period and the forecasted price movement, up or down. Meaning that there is no need to take leverage, limited orders spreads or swaps into account when forecasting or closing trades. They are not relevant to this type of contract, unlike others. Also, with futures contracts, there is no need to wait around for the price to reach its peak, as one point of price movement in the forecasted direction is enough to produce up to 90% returns on the initial investment. The trading terminals for this kind of trading are significantly more user-friendly than trading platforms for, let’s say, margin trading. At first glance, what could be so difficult about choosing one of the two directions of price fluctuation?

The issue is that approach itself to working with futures contracts tempts many to trade impulsively, leaving it up to fate, lunar cycles, or horoscopes for example. Here specifically is where you find the assumption that successful traders are just psychic and able to foresee the future course of the EUR/USD. However, in reality, their actual trading advantage lies in their ability to apply traditional approaches to technical and fundamental analysis, already well-known for decades, to forecast the price of this or that asset.

Supply and demand influence the value of this or that asset. The demand for an asset is the result of traders and investors aspiring to make the asset cheaper, so as to re-sell it when the price increases. Conversely, supply forms on the market as a result of traders and investors expectations of asset prices dropping, so as to buy them at a lower price. Every day there is a struggle between those who wish to sell (bears) and those who wish to buy (bulls). This struggle specifically is driving force of asset price fluctuation.

It is very hard to forecast why traders change their outlook, as many factors have an effect on their interest in buying or selling an asset. Furthermore, it isn’t possible to be 100% certain in any specific future dynamic or the direction of asset price movement. 80% is way more realistic! There are specific approaches to market analysis that absolutely every trader uses.

How can you predict the market?

There is not one trading educational course built around predicting future market movements through psychic ability. Do you know why? Due to the fact that there is not one documented case of a person, with no grasp of technical analysis whatsoever, trading intuitively and making a profit off every single trade.

What are the approaches to market analysis? Despite the unpredictability of traders’ moods, it is possible to make out a clear pattern from their behavior, meaning that the price moves naturally in a cycle on the chart, from which future growth or decline is clear. For example, after the narrow zone of rate consolidation, when traders activity drops as they await some economic or political event when there is a natural surge in market activity, where is it possible to place trades that are closed on a profit. There are many of these asset price fluctuation patterns that are identifiable on charts. Technical analysis trading strategies are built specifically using various famous patterns, allowing for the forecasting of future rate movement with 80-90% certainty. For identifying these patterns, both technical indicators and chart tools are used. To put it simply, a trading strategy is a collection of identification rules used to forecast patterns through various means of analysis. Trading with several strategies specifically gives traders the best chance to earn profits from closing trades. Successful traders know all too well that throughout the trading process there is no room for chance or gut instinct. This is an example of what a professional trading platform for futures contracts looks like. It is equipped with a wide array of chart customizations, technical indicators, and chart tools, allowing you to utilize any trading system you wish.

Admittedly, knowledge and experience alone don’t explain trading success, as the trader’s psychology plays a meaningful role as well. The point is that only highly disciplined and motivated traders can reach such financial heights. They take trading seriously and have control of their emotions such as stress, passion, greed, and hysteria. In particular, knowledge and experience combined with attitude psychologically enable them to achieve their set goals.

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Therefore, in regards to successful professionals, psychic traders, who close trades based only on their gut instinct, virtually never come up. We mean the driven, disciplined people, who dedicated themselves to studying the various trading strategies and how to best control their emotions. In order to earn thousands of dollars daily, every trader must tirelessly strive to foster qualities such as discipline and drive in themselves, and slowly study, practice and perfect various approaches to market analysis.

The Telepath Trader

We have previously outlined how traders produce forecasts for such chaotic rate movements and earn impressive profits. So, do psychic traders exist nonetheless? Let’s take a minute to imagine that a person exists who forecasts the market using their gut instinct exclusively. In that case, they would be the richest person in the world, who knows the exact moment to buy and sell various assets. On the other hand, the existence of such a psychic trader would mean that all of the currency assets, raw materials, and securities with the most liquidity and potential would fall into the hands of one person as they would be able to play the entire financial market. Accordingly, that person would be able to rule the entire world and capture and control other countries. That would also mean that there would be no further point in financial trading, as the typical patterns of price movement that technical analysis is built on, would no longer apply.

However, we will also not categorically rule out this phenomenon, as the human brain and its abilities are not completely known. Although we can explicitly state that the all the staggering success traders have achieved is exclusively thanks to their serious and motivated approach to trading combined with gradual self-improvement of rate fluctuation forecasting. Furthermore, there are people that simply have more developed intuition, sensitivity, attention to detail and are more observant, who progressively study the financial market and catch on more quickly to the slightest shifts. Therefore, instead of trying to develop a psychic sense or blame your misfortunes on lacking second sight, better educate yourself! To that end, these days many companies offer users an educational course free of charge in basics of trading, including exchange terminology, interactive learning, and step-by-step instructions:

Also, the best companies offer demo accounts as well, which allow you to gain the necessary skills with virtual money on a real platform. When you begin to trade independently it is you should continue improving your knowledge, market analysis skills, and trading psychology. After that, you must rid yourself of that “telepath” part of you, as you can close the majority of trades profitably without it, increasing your capital with every trade.

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Trader’s Psychology: The Importance of Being Positive

A Good Attitude is One of the Marks of a Successful Trader

The psychological effect strongly influences trading results. All experienced traders are well aware of this nuance, however, in turn, beginners often undervalue the importance of this point. Actually, the psychological aspect of trading futures is key to earning profit. Whereas the situation here is more complicated, just simply the presence of a good attitude and self-confidence increases the likelihood that your plan will be successful. Trading psychology is a very interesting, important topic. There is a reason that there are so many bestsellers written as an answer to that very question.

This article will present a general summary of the main points on this topic. We will go through many aspects that touch on psychology and beyond. An honest outlook, emotional control, patience, suppressing the instinct to treat it like gambling, and the difference between live and demo accounts are all point that will be covered in this article. It is possible to go into the psychology of trading in more detail, as a number of famous authors can attest to, however, we decided to cover all of the main aspects in this article.

How a Trader’s Mind Works

This section of the article deviates slightly from the main topic. Here we will address the issue of how the brain works and how it differs from that of computer algorithms. How both intuition and your mood (mental outlook) relate to the productivity of your work will also be touched upon. As you know, this article is devoted to psychology, however, this section is vital to understanding the essence.

It’s not uncommon for people of a certain level of success to be superstitious. Not implying that they believe in all kinds of folklore or rituals, but in a pragmatic sense only. Referring to the fact that they follow specific principles, enabling them to achieve and maintain success. In the context of trading, this point is especially clear. The problem is that the market is to a certain extent unpredictable. Which is why a trader’s individual psychology is far from the least important on the hierarchy for success.

For what purpose are we doing this? And how do our brains work? These questions are very important because nothing is more important for trading successfully on the exchange than simple, algorithmic thought. Things would be different if robots had already surpassed people, but that isn’t going to happen, even taking into account improved “artificial intelligence” and neural networks that learn from their environments on their own. That answer to this question lies in the unique inner-workings of the human brain.

Traders (people) in particular are able to generate more precise forecasts in those very situations where robots are led astray. The entire problem hinges on the fact that there is no universal algorithm that can be counted on to forecast future price behavior accurately. The human brain, in contrast to computer programs, considers significantly more input signals (with at least a visual assessment of the chart) than robots. Computers are able to access a very limited amount of data, only that collected by the algorithm’s developer. The human brain accesses and processes a massive amount of information. Although, we aren’t aware of more than 80% of it. However, that doesn’t mean that all that information is absent from the thought process. That information specifically is what creates what is usually referred to as intuition.

With that in mind, we will not get too far off topic and return to trading. So, why do the brains of experienced traders forecast more precisely than those of beginners? Even if they both are using the exact same trading strategy. It’s simple. The point is that, in terms of practical trading experience, there are hundreds of thousands of different models of price behaviors in various situations already stored in their memories. Therefore, professionals think differently, they take into account not only the information before them at that time, but also what they have come across before, which is saved in their memory. Namely, in regards to the subconscious process. That is why specifically an experienced trader often can identify a false signal from the first glance, even when the indicators appear to show that it is the opportune moment to enter the market.

Why is it important to have a positive outlook?

In order to answer that question, we need to look a bit further into our first subject, looking into how our brains work. Every emotion and feeling prompts the development of a specific, let’s say, hormone that puts us in a specific state of mind. There are hormones for everything, fear, happiness, peace, certainty… and more importantly, for their combinations. Their concentration in our brains and veins not only affects our mood but also our objective productivity.

So, those who don’t expect failure, don’t experience it. And the reasons for that are fairly objective. When we are depressed, start to doubt ourselves and feel defeated, our brains literally begin to function worse. Meaning that the subconscious part of our thought process suffers when we are identifying signals, unbeknown to us, but in our memory. In contrast, if a trader is positive and has confidence in their success, then, first and foremost, that is reflected in their mental health and wellbeing; and secondly, actually increases their speed and mental productivity.

Our mental state has a real and lasting effect on our physical and mental health, but mainly on the efficiency of our mental process. In terms of psychical work, for example, this doesn’t play a key part. However, in the context of intellectual endeavors is absolutely is key. And trading falls into that category.

8 Traits of Successful Traders

  1. Taking Trading Seriously. Professionals view trading on the exchange as a full-time job, not like a casino. In terms of trades, they are after quality, not quantity. The majority of beginners don’t take trading seriously enough. That, in the end, will lead to a loss in investment and disappointment regarding the lost opportunity for profit.
  1. This is a very beneficial character trait. Without it, it is near impossible to achieve anything of note (above average) in any field. Learning how to trade on the futures market is far from a quick and fast process, so, to make it through, a person needs to have a strong sense of motivation, or they would give up halfway through without understanding all the advantages and opportunities the field has to offer.
  1. Experienced traders never follow the crowd. This doesn’t mean that they never agree with the general consensus. On the contrary, they factor it in along with many other nuances. However, their final decision is based on thorough, cumulative analysis of the situation. Professionals operate, first and foremost, based on their personal experience. That knowledge is more valuable.
  1. Another very important character trait. Impatience inevitably leads to financial losses, as serious analysis becomes more and more like a lame game, buying or selling short-term rates (“white/black” in the algorithm). Successful traders must be able to wait for signals for good opportunities on the market or the right moment to close long-standing trades and so on.
  1. The Right Attitude to Personal Failures. The only one who doesn’t make mistakes is the one who doesn’t do anything at all. Successful people make mistakes as well. However, they differ in the way they react to their own personal shortcomings and failures. They learn from any situation. In the context of trading, it means that every unsuccessful trade or financial loss must be analyzed in-depth in order to discern what part of the trading system lead to the unfavorable result. After all, every trade is placed with the expectation that it will end in profit. However, it isn’t possible to predict everything. Every once in a while, your trading strategy will be improved, and, with time, your profit will increase.

  1. Risk Limitation. Trading on the exchange is a job that carries along with it a high level of financial risk. Therefore it is important that traders take this aspect seriously. They must always weigh the risk against the potential profit. Traders always hope that the potential profit outweighs the likelihood of the possible loss. In practice, of course, this isn’t always the case. However, sound risk diversification and capital management can keep financial losses to a minimum.
  1. During the trading process, traders are met with numerous temptations. When deliberating, traders fluctuate between objective logic, their intuition and their emotions (first and foremost they are fear and greed). Considering the statistics on the subject, it is clear that traders often don’t go with their heads. The vast majority of beginners go by intuition alone. They “Buy” when it “feels” right, not when their trading system has indicated it is lucrative to do so. Professionals operate differently, although they don’t put their intuition completely aside, they, however, begin with an in-depth analysis and evaluation of the situation.
  1. A Positive Attitude and Self-Confidence. We return to the topic that this article began on. Successful people to not spend too much time dwelling on their mistakes. They quickly recover from setbacks, analyze what went wrong, and then continue on in their chosen direction.

The Right Attitude to Anxiety

Fear, along with a lack of robustness and self-confidence, is the most destructive emotion and is a serious barrier to achieving your goals. Many beginners are familiar with the feeling when they literally begin “praying” that the market moves in their desired direction till their trade is closed, especially if they need several points for it. This approach is fundamentally wrong, it puts traders in an embarrassing and unsalvageable position in relation to the market.

There is no way to completely escape anxiety. And there is no need to try to, because it is our primary protection instinct, and it saves us from many reckless decisions. However, you need to relate to it in a healthy way. There is one universal way that enables you to decrease your level of “turmoil” in real measure. The key idea is that you need to answer the following question completely honestly. What specifically are you scared of? As it relates to trading, there is no need to guess, as everyone is afraid of their active trades leading to losses. Which is why you need to “look your fear in the eye”. When you enter the market, you should rigorously calculate both the anticipated profit and the possible loss, morally preparing yourself for the worst case scenario. This approach really combats anxiety, decreasing “turmoil”, allowing you to more soberly analyze the real situation. To put it simply, “hope for the best, but prepare for the worst”.

Conclusion

This article was a bit unusual, however, in it we covered the main issues regarding the psychology of traders. We went over a basic understanding of how our brains work, the effects of a positive outlook on intellectual productivity, character traits of successful traders, and also practical ways to overcome anxiety, the main saboteur of success. In closing, it is worth noting that, despite it all, trading remains a very risky activity. Therefore, never invest money that you can’t afford to lose without decreasing the quality of your life, such as with borrowed funds.

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Why a beginning trader needs mentor. Is it so necessary at all?

For the vast majority of new traders on the exchange, there are masses of hidden tendencies and specialized aspects of trading that are inaccessible, which have a strong influence on the end trading result. This is why a problem arises every ambitious new trader of how they can best learn about the field. Of course, you could say that in this age of technology that enables access to research materials such a problem shouldn’t arise. But how can a user, who has no practical experience whatsoever and has never dealt with the trading process on exchange platforms, comprehend all the field-specific knowledge and finer details of trading. Once you understand this, it becomes clear that the first step should be finding a mentor to fulfill this role. One who can give explanations and direct potentially successful traders along the right path. On that note, we propose considering the question, do new traders need a mentor, their educational role in explaining the trading process, as well as the problems that come along with it.

So, in his time, the brilliant trader Larry Williams made quite the philosophical statement that “anyone can become a great trader!” It should come as no surprise, after all, trading or exchanging any good for another is built into our DNA. All you need to do is look at history to see that. As soon as people began to produce surpluses of any good or resource, they began to search for opportunities to utilize this with the goal of obtaining even more goods. Throughout history, people have perfected this process and, as a consequence, exchange platforms appeared where today trading operations take place on a hi-tech level using innovative financial tools. Despite Williams’s popular expression, new traders face a wide variety of problems that a professional mentor or teacher can resolve using their hands-on experience and skills.

A professional education is necessary for nearly every professional field. These days it simply isn’t possible to be born with all the necessary skills without any previous experience or education and just start a career. The role of mentors hold significant meaning in a people’s individual lives because they can not only gain skills quickly and effectively in their chosen field, but they open up an opportunity for professional growth. This can be said about any process. For example, parents teach us basic skills like walking, talking and taking care of ourselves. Our teachers at school build the foundation of our professional knowledge, such as writing, reading, and math. In further education, mentors introduce us to our chosen fields. It is the same for trading with financial assets. Without a mentor, it is difficult to achieve success. We propose taking an in-depth tool at the role and job of a mentor in regards to financial trading.

Why do you need a mentor when you start trading?

As a way of expanding on this question, suppose a typical person decides to try their hand at trading after seeing an ad online. They find a respectable platform that provides a free high-quality professional education. They successfully undergo the theory and even practice on a demo account. That’s it, they are ready to make a significant profit and have already begun to decide on what they want to do with the money they will earn. However, they quickly understand after their first live contracts that it isn’t all as simple and clear as it was in the books. As follows, the new trader starts to make a lot of mistakes and pays a high price for their trading experience. As we already mentioned, the majority of investors lose all their funds over this period and, in devastation, leave the market and trading behind. This is where the place of mentors comes in, who thanks to their experience and skills become positive beacons for new traders to gain information. Keep in mind that only people with significant hands-on experience can help you bridge the gap between theoretical concepts and knowledge and the actual trading process. Don’t get it in your head that once you are familiar with basic theoretical knowledge on trading that you can build highly-professional strategies, develop rules of behavior on the market, and work out systems for capital management. No, such experience alone won’t suffice. Other than that, new traders need to overcome a wide variety of psychological aspects of trading on the financial market. In this case, you can’t avoid the need for someone with experience.

And, of course, the quality of educational materials on trading available on online platforms is worth mentioning. Despite what the aggressive advertisements say where various online resources or “experts” claim that with only a few lessons or a bit of training you can become a successful trader, the actual quality of these educational materials leaves something to be desired. Only a basic selection of concepts and professional approaches for trading with financial assets are often provided. Such a limited selection that they can’t possibly provide adequate information on the finer details of the trading process. Meaning that if you haven’t completed a specialized university course on trading, then don’t expect it to be a professional level of field-specific knowledge. And experience can be resolved through a mentorship.

More proof of how important it is to have a professional mentor for trading from the historical point of view that all of the famous and brilliant traders themselves had mentors and teachers who explained all the nuances and professional trading approaches to them. Of course, every one of them designed their own system for working on the market, and possibly even a trading philosophy, however, their initial push toward success was from their mentors. Many professional traders say that they couldn’t have achieved such success without mentorship programs. They only formed the basis that enabled them to become successful investors able to achieve astonishing results through the support of a teacher, a trader, a critic, who consulted them in complex market situations. You can take a purely psychological aspect of working on the financial market from this. That being that, more often than not, mentors are highly regarded individuals in their field, therefore they act as an example of success, driving you to improve yourself. Their mentor’s success drives their ambitions, motivating their professional growth with an experienced trader’s support.

When you take into consideration how important mentors are for developing the professional skills of new traders, working with an experienced teacher is a worthwhile long-term investment that will pay off further down the line. See for yourself, when you work with a mentor, even on a paid basis, you are making an investment in yourself. Your teacher can help you foster the necessary skills in terms of bridging the gap between theoretical trading concepts and practice, identify your strengths and weaknesses, let you in on trading secrets, and explain the nuances of trading that only come with experience. All of this together will empower you to generate profit on the financial market for years to come, fully recouping this initial investment and enabling you to achieve more success trading.

Let’s go through some of the conclusions thus far. When going through all the perspective aspects of working with a mentor, we can say without a doubt that a teacher is a basic necessity for any trader aiming high! Let’s avoid the more philosophical musings and focus on the more concrete, clear benefits that a good trading mentor provides. Here it is worth pointing out the following:

● They can make the most complex aspects as simple as possible – It is no secret that trading theory is fairly difficult for the average person to comprehend. Moreover, it can be difficult for someone without experience to digest such information. Private lessons with a mentor can build your basic understandings of the concepts in an easier and more accessible way. Other than that, when mentors’ outline their lesson plans they always begin from their student’s individual intellectual level and teaching them professional knowledge from their starting point. Meaning that your learning experience will be less intimidating and more clear.

● An individualized approach – When you work with professional mentors you get to work one-on-one with your teacher. Through talking to you, they can work out what potential strengths you have, as wells as the ways to minimize the influence of your weaknesses on your trading results. Moreover, by learning through personal discussions you can figure out tactics and behavioral patterns of working on the market that are best suited to you as an individual.

● Effectiveness – A mentor will not only break down the theory for you, they will also give you hands-on practical advice. The simple example of this would be how there are innumerable different trading systems on the market and nearly all of them produce profit. However, one strategy might generate profit for one trader, but for another only lead to losses. There is no entirely universal strategy that will work for every single investor. In this respect, your mentor is your irreplaceable trading partner. Thanks to their years of experience, your mentor will be able to evaluate your skills and personal characteristics, enabling them to recommend you the most effective strategies for evaluating market rates, generating maximum profits for you.

● Insurance – Typically when beginners are taught privately by a mentor there is a contract that clearly outlines all aspects of their work together. Therefore, your investment is fully protected during your studies and guarantees that they have a defined professional level of knowledge of financial trading.

As you can see, mentors provide many advantages that you won’t have if you simply teaching yourself. They will also make more of your time during the learning process.

The form mentorships take in trading

These days mentorship programs are available online, as well as in person. Mentorships come in the following forms:

● Individual mentoring – This is the most expensive option, where a mentor works directly with you. Despite the high cost, this is the most effective way of learning. You benefit from all the various educational approaches, as well as getting the best quality professional help.

● Group mentoring – In this case you are mentored in a small group. This way of learning is less expensive, however, that doesn’t mean that it is less effective. Studying in groups polishes your experience and enables you to benefit from the professional skills of others in the program, which can be very useful in the long run. As every participant of the group can learn additional information on the nuances of trading and, on the basis of that, form their own practical trading strategy.

● Consulting – This type of mentorship appeared along with the rise of online trading. These days you can find many good experts online that provide training and run webinars for new investors. The advantage of these are their low cost, often they provide training free of charge. You can consult on any specific technical issues in regards to trading and expand your professional potential as an investor from the practical experience of professionals. Other than that, such a format is often provided by trading platforms through communicating with their individual managers and analysts.

Pay attention, as these days it is easy to find a professional mentor in any form that works best for you. There are a wide variety of options available that turn a beginner into a successful trader.

Conclusion

The answer to the question our article poses in regards to if traders need a mentor is an astounding yes. When you have an experienced teacher at your disposal, you set the stage for achieving success, expanding your potential as a trader, and laying the groundwork for financial growth.

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