Forex trading, stocks trading, index futures, commodities, cryptocurrencies, and any other type of equity trading offers the great possibility of financial freedom, but it is also fraught with danger. The oft quoted statistic that 95% of all new traders fail in the market is something anyone entering the market has to take heed of and prepare themselves so that they enter the market fully prepared and with no illusions. Yes, there is money to be made; but equally, there is money to be lost! Therefore, you need to be fully aware of what is required to trade equities successfully.
There are three essential qualities any trader entering the market requires if they ever hope to be successful. These are:
Expendable capitalCapital or money is the obvious requirement but note that we are not just talking about capital here, but expendable capital. This is because your dependence on that capital is important as it often places constraints on, and impedes proper money management and often dictates your emotional response to trading.
PsychologyTrading often has a major psychological aspect in terms of emotional response, not only towards your losses, but also towards your winnings.
Trading MethodA holistic trading method is not just a trading system based to fundamental or technical analysis, but also encompasses proper money management based upon risk and reward, and your emotional response to market conditions and trading activities.
This is where Chart Formations comes in. Whether you are, or aspire to become a day trader, a position trader, a scalp trader, or an investor, Chart Formations is your on-line stock trading resource that is dedicated to providing reliable information to assist you, our user to trade the stock market more successfully, from the perspective of technical analysis. As such, we discuss information related to stock charts, technical indicators, technical analysis, and common stock chart patterns, including candlestick patterns, all explained with examples. The ultimate aim is to assist you in creating their own high probability, stock trading strategies, regardless of whether they are trading forex, cryptocurrencies, commodities, or stocks. But our approach is more holistic as we focus not just on technical analysis but also on money management and trader psychology in an ever changing market environment.