Strongest Strategies in Global Financial Markets Trading
In the dynamic world of trading, certain principles hold true for those seeking success. Brent Penfold, a seasoned trader, shares these universal principles in his book, "The Universal Principles of Successful Trading: Essential Knowledge for All Traders in All Markets."
The ideal markets for trading are characterised by volume, price transparency, liquidity, 24-hour coverage, low transaction costs, and efficiency. Traders are advised to choose their own personal style of trading, whether swing trading or trend trading, and trade based on their chosen time frame.
One of the key principles that Penfold emphasises is risk management. He believes that it is the most important aspect in trading. Deep practice before trading is stressed, and traders are advised to make their trades as fixed as possible in money management. Trading small is also recommended.
The book identifies the three pillars of trading as money management, market selection, and developing a trading style. To calculate the risk of ruin, instructions on using Excel are provided. Learning to anticipate reversals is suggested, and simple trading strategies that follow traditional support and resistance while trading with the trend are recommended.
Discipline and patience are necessary in trading psychology, as is humility. Being in control and maintaining alignment in set ups are also important. Good defense wins games is a principle that applies to trading as well.
Penfold seeks advice from professional and successful private traders for aspiring traders. He recommends authors such as Michael Covel, Alexander Elder, and Mark Douglas as valuable sources for young traders. The book's trading wisdom is extensive, combining the best from multiple trading books.
However, it's important to note that 90% of people who enter the markets to trade will lose. The book emphasises the importance of lowering the risk of ruin to zero. Identifying low risk set ups and focusing on risk management are key strategies to achieve this.
The book warns about the pains associated with trading and provides a realistic perspective. It is recommended by a successful trader for a decade and is a must for any serious trader's library. To learn more, you can find the book's link provided.
In conclusion, "The Universal Principles of Successful Trading" is an excellent resource for experienced traders and a valuable guide for those just starting out. By following these principles, traders can increase their chances of success in the competitive world of trading.
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