If asked to describe financial markets to someone who's never heard of them, you'd use terms like chaotic, random, volatile, unpredictable, wild, and never constant.
As a serious trader, your first step is to chunk down until you have a framework that brings order to your trading. Think of it like a playing field in sports. Within the field of play is when you can trade, and out-of-bounds is when you don't trade. But it's not only about being in the field of play. In team sports, players have unique roles and only engage in certain cases. Trading is no different.
A trading playbook refers to a catalogue of strategies deployed in certain cases. And as a result, they produce positive results over the long-term. It means they make money over x number of trades despite in trading where nothing is 100%. Traders refer to this as edge. When the market presents an opportunity to combine several playbook trades simultaneously, it can be satisfying and rewarding.
We're in the odds business, but confidence plays a role in everything we do, including trading. Has your trading confidence taken a hit? How would you feel knowing you are stacking known positive expectancy trades on top of each other? You'd feel full of confidence and not hesitate to act on your trade. Right? Hence why, the best traders swear by a trading playbook.
Your only tasks when live trading are:
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Recognise when the market behaviour matches a playbook trade.
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Execute the trade.
You're going to see a recent short and long trade. But before that, it's important to understand why there are always reports of high failure percentage of traders outside of professional trading. It's because these traders don't have an edge. i.e. no catalogue of trades that produce positive results over the long term. It takes years of knowledge and forward testing to evolve a trading playbook. If you go it alone, you'll likely never get there.
But the good scoop is you have a choice. You can learn playbook trades when you trade at a professional trading firm or work with a mentor who can teach you their extensive playbook. It's a legitimate shortcut to developing profitable trading. If you love trading, but poor results and little progress are painful, either option will get you past this.
Now, the examples are shared to show you:
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Order and form can exist in what is an otherwise chaotic and random environment.
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You can play the game on your terms, building your trust and confidence in trading.
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It's how serious traders can operate a trading business that has long-term positive performance.
The short trade is taken when four playbook trades occur at the same time.
The long trade is taken when three playbook trades occur at the same time.
Forex and derivatives trading is a highly competitive and often extremely fast-paced environment. It only rewards individuals who attain the required level of skill and expertise to compete. Past performance is not indicative of future results. There is a substantial risk of loss to unskilled and inexperienced players. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an independent
Editors’ Picks
EUR/USD holds around 1.1750 after weak German and EU PMI data
EUR/USD maintains its range trade at around 1.1750 in European trading on Tuesday. Weaker-than-expected December PMI data from Germany and the Eurozone make it difficult for the Euro to find demand, while investors refrain from taking large USD positions ahead of key employment data.
GBP/USD climbs above 1.3400 after upbeat UK PMI data
GBP/USD gains traction and trades in positive territory above 1.3400 on Tuesday as the British Pound benefits from upbeat PMI data. Later in the day, crucial data releases from the US, including Nonfarm Payrolls, Retail Sales and PMI, could trigger the next big action in the pair.
Japanese Yen seems poised to appreciate further; awaits BoJ decision on Friday
The Japanese Yen maintains its bid tone through the first half of the European session on Tuesday which, along with a bearish US Dollar, keeps the USD/JPY pair depressed below the 155.00 psychological mark. The growing acceptance that the Bank of Japan will raise interest rates this week turns out to be a key factor behind the safe-haven JPY's outperformance.
Editors’ Picks
US Dollar weakens after mixed Nonfarm Payrolls data – LIVE
The US Bureau of Labor Statistics announced on Tuesday that Nonfarm Payrolls (NFP) rose by 64,000 in November. The report also showed that NFP declined by 105,000 in October, while the Unemployment Rate rose to 4.6% in November, causing the US Dollar to come under renewed bearish pressure.
EUR/USD holds around 1.1750 after weak German and EU PMI data
EUR/USD maintains its range trade at around 1.1750 in European trading on Tuesday. Weaker-than-expected December PMI data from Germany and the Eurozone make it difficult for the Euro to find demand, while investors refrain from taking large USD positions ahead of key employment data.
GBP/USD climbs above 1.3400 after upbeat UK PMI data
GBP/USD gains traction and trades in positive territory above 1.3400 on Tuesday as the British Pound benefits from upbeat PMI data. Later in the day, crucial data releases from the US, including Nonfarm Payrolls, Retail Sales and PMI, could trigger the next big action in the pair.
Gold retreats from seven week highs on profit-taking; all eyes on US NFP release
Gold price loses momentum below $4,300 during the early European trading hours on Tuesday, pressured by some profit-taking and weak long liquidation from the shorter-term futures traders. Furthermore, optimism around Ukraine peace talks could weigh on the safe-haven asset like Gold.
Ukraine-Russia in the spotlight once again
Since the start of the week, gold’s price has moved lower, but has yet to erase the gains made last week. In today’s report we intend to focus on the newest round of peace talks between Russia and Ukraine, whilst noting the release of the US Employment data later on day and end our report with an update in regards to the tensions brewing in Venezuela.
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