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Linda Raschke - Trading Information



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I am a frequent user of Moore's Research center aand just received the 
article below.Of particular interest is the Aug. 1987 market behaviour 
to Aug. 1999.

The site is listed in the text and I hope you find it interesting.

John


Dear Fellow Trader:

Moore Research Center, Inc. has been tracking an amazing correlation 
detailing the
sequence of daily bar patterns that clustered around the 1987 August 
market 
top.  I thought that you would find the research quite interesting to 
review,
since last week's action unfolded with 100% accuracy.  They have been 
gracious
enough to publish a link sharing their work at: 
http://www.mrci.com/special/dj87.htm

Secondly, if you would like to join us online during the day, our 
real-time
trading room (LBRTrading Room) is open for free on the first day of 
the month,
which is this Wednesday.  To log on, go to:
http://www.mtrader.com/linda.htm, or hit the Chatroom at:  
http://www.mrci.com/lbr/.
When it asks for a password, type in any 5-digit word.   We post our 
market
commentary, analysis, and the trades we make for our own office during 
the 
day, in addition to noting things of educational interest. 

Lastly, Mark Cook and I have been working on producing a joint trading 
seminar devoted to short term trading in SP futures and the bond 
markets.
I thought this brief article hit upon some basic points for successful 
trading.  (For information on the seminar, go to:  
http://www.mrci.com/lbr/daytrade)

WHAT MAKES A TRADER SUCCESSFUL - Mark Cook

Many people have asked me over the years what it takes to be a 
successful
trader.  The answer is not clear but here are a few thoughts to ponder 
and 
apply.  First, you must have a complete commitment to trading and do 
it 
full-time.  If it is a hobby or a secondary pastime, I know how the 
bottom line will be - a big minus.  Trading must be addressed as a 
profession
because if you do not treat it as such, let me assure you, those who 
do treat
it this way will separate you from your money very quickly.

Secondly, you must fit your trading habits to your individual 
personality.  If
you are an impulsive individual, your style will reflect more trading 
than
a calculating individual who waits for all the indicators to fall into 
place.
The personality factors more than any other factors I know will 
determine 
success or failure.  If you are an emotional person, admit that you 
are and
structure your trading habits to make emotions a positive influence, 
not a
negative one.  If you are either greedy or fearful, that will affect 
your 
decision making on a position and without recognizing the governing 
emotion,
your decisions will tend to be wrong.

When I experience emotions in the market, they tend to be fear.  
Whenever I
am the most fearful of the market, I recognize that at these times 
there can
also be some of the best opportunities.  Whenever my fears become 
overwhelming, my discipline tells me to buy or sell, and discipline 
must win out or you are doomed to failure.  
       
The work ethic can never be overstated.  I watch the market all day 
long 
from the opening bell to the closing bell.  I have kept diaries on 
every day
in the market for the last nine years, sometimes having over 40 
entries in 
my diary per day.  If I do not do my work, my profit suffers.  There 
is no 
short cut in trading and the market will quickly find if you are lazy.

Planning is the objective part of trading.  Start with the worst case 
scenario and work from there.  You will never be more objective than 
before
you execute a trade.  Once you are in a trade, emotions take over.  
The plan
must be in place before the activity takes place.  Determine a plan 
that
tells you when you are wrong and admit it.  Get out, retreat, and live 
to
fight another day.   

As the day progresses, know how much money you have made or lost.  It 
is 
much like knowing the score of a basketball game at every instant and 
you
are the coach.  Trading is a job and your paycheck is determined by 
your 
ability.  You can only maximize your ability if you have all the 
information. 

The key to S & P trading is to live by the rule that "a dollar made 
should
be kept." This means that profits should be guarded like Fort Knox to 
keep
losses from stealing your net worth.  Enter every trade with the 
understanding
of your risk, not your profit potential.  If you can honestly answer 
to 
yourself that this risk is acceptable then the trade should be 
implemented.

What happens is that human nature causes greed to become a focal point 
in
minds.  This thought of "how much money can I make" dominates the mind 
set
and blots out the negative of "how much money can I lose".  Until your 
focus
is entirely comprehending the negative, or losses, the positive, or 
profits,
will allude you.  Many times I have seen people trading the S & P 
Futures to 
have a very profitable run of short duration.  The 'walk on water' 
conviction
does one thing, it enables you to get to deeper water before you 
drown.  The 
mistaken air of confidence is just an emotion that precedes the 
consumption 
of humility.

Let's look at one last rule - a must do.  Have complete faith in your 
indicators.  Many times your indicators give a buy or a sell signal 
and you
don't follow it because you just don't have the confidence that this 
time 
the signal is right.  Successful traders believe in their indicators 
but are 
also very aware that nothing is 100% foolproof.  Not taking a trade 
that is 
set-up using indicators you have developed is like calling yourself a 
liar.
The indicator is a product of you telling yourself to do a trade and 
you
respond by saying, " Indicator, you are not giving me a true signal." 
Grade 
yourself a 'red F' and go sit in the corner. 

The best advice I can give to anyone who aspires to become a trader is 
to 
observe those who are successful.  Any information that you can 
procure on 
trading philosophies, trading mechanics and trading techniques of the 
pros
is well worth your while.  If learning from those who have experience 
cuts 
down on your learning curve time, isn't it worth it? I have heard 
persons 
say that they were going to learn by themselves.  Learning for 
yourself will
work if you have the time and the financial resources.  Stubbornness 
and 
pride can be hazardous to your wealth.  If you do pursue learning from 
the
'masters' do not be surprised to find that there are many different 
ways 
to trade profitably.  Do not try to clone another individual because 
your 
personality is never exactly the same as theirs.  Observe, learn and 
test 
the waters to arrive at the confidence level you will need to achieve 
consistent success.

Finally, and most importantly, trading is a long-term commitment.  I 
fervently believe that it takes several years to become a true 
professional.
Each year you should become more consistent in your profits and enjoy 
more 
confidence in your indicators.  My final daily rule is to take every 
trade 
and dissect it.  This will provide a road map for success by knowing 
where 
you have been and what mistakes you can learn from and which to avoid. 
..................................

Mark Cook and I have been sharing our daily trading statements with 
each
other for the last 20 months.  During this time we have been comparing 
not
only our own trading styles and execution methods, but even more 
importantly,
the ways that professional fulltime traders have been able to 
structure their
trading environment to enable them to achieve CONSISTENT success.

The joint, real-time trading workshop that we are giving is based on 
our
collaborative efforts to extract the best material from our combined 
40 
years of FULL-TIME trading experience.  Mark will also be revealing 
his 
bond trade setup that he publishes on his daily advisory service.  He 
has 
achieved an astounding 85% published win/loss ratio with this trade 
over 
the last 2 years. 

For more information on material covered in the workshops, go to:
http://www.mrci.com/lbr/daytrade/

Space is restricted and the September Ft.  Lauderdale workshop at 
which
Marty Schwartz will also be speaking, has only 7 spots left.  If you 
have
any further questions on the seminar material, Mark will be available 
by
phone between 5 - 7 PM, EST, at: 330-484-0331.  Weekdays through Sept. 
10.
He will be happy to twist your arm if you are sitting on the fence!

For registration information, contact Laura at LBRGroup Inc., 
888-LIMITDN.

Trade smart and prosper!

Best Wishes,  Linda Raschke 


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