Learn the Top 10 Tools for “Listening” to the Market

[hedgehog]

Learn the Top 10 Tools for “Listening” to the Market

 

One of the toughest challenges in trading is “listening” to the Market. Regularly we are almost convinced to recklessly foretell instead of listen. Or, we suspect we already know what’s going to occur, so we simply jump in or naturally wing it.

 

Listening, truly listening to the heart beat of the Market, with your complete being is a talent and one of the most critical and challenging things we will master.

 

Found this from indicatorwarehouse:

 

The following ten “rules” can be helpful.

 

1. Stop the Chat! It is hard to listen and talk at the very same time

 

2. Stop the internal gossip. Target the trading task to hand.

 

3. Give yourself time. Grant yourself “permission” to let the Market speak to you. How does it look, is there an apparent bias, is a trend already in play.

 

4. Let the rhythm of the Market come through. Communicate with the Market thru your charts. Look at them. Nod when you can agree, Talk aloud and comment. Hear your charts… They’re chatting with you.

 

5. Remove diversions. Good listening means being prepared to switch off the Television, close a door, or stop reading your e-mail.

 

6.Give your trading your complete attention. Hook up with the Market Makers. Particularly if they’re making a market moving play, or doing something that you intensely disagree with, take a minute to stand in their shoes, to have a look at the situation from their viewpoint.

 

7. Wait. Some moves take more time to find their groove or show direction. Give the Market time to get it out before you jump in.

 

8. Study your feelings. If what the Market is “exclaiming” creates an emotive reaction in you, be particularly careful. When we are indignant, scared or upset, we frequently miss urgent parts of what’s being shown to us.

 

9. Don’t presume or foretell. Regardless of whether you have a move go against you, respect the Market. If you interpret a bad trade as a private attack, regardless of if turns in your favor, you could be building terribly unacceptable habits!

 

10. Be careful. If uncertain stay out. A move should be obvious to you and your methodology. If you find yourself hoping, get out!

 

 

BONUS:

 

STOP talking! This is both the 1st and the final point, because all the other guidelines rely on it. Nature gave us 2 ears and only 1 mouth, which is a light hint that we should “listen” ( watch ) 2x as much as we “talk” ( act ).

Edited October 1, 2010 by hedgehog