Trading Psychology – Ignore the flashing lights to discover your edge
The unequivocal objective of Futex Academy is to train individuals to trade futures consistently profitably. Synonymous with performance consistency is a trading approach that emphasises control and effective decision making at times of extreme emotional and market pressure. As we head towards the release of the monthly U.S. Employment Situation report from the Bureau of Labor Statistics, it is an ideal time to highlight how and why we employ this clear aim.
One of the key traits of a novice trader who performs consistently well is an ability to participate in the market when he has an edge; to pick those fights that he thinks he can win. Our trainees spend countless hours observing and interacting with the markets with a view to identifying times of day, price areas and market behaviour (including order flow and volume) that they confidently believe will provide profit opportunities. This is what we refer to as their edge. We compete in global financial markets against other participants who have the financial muscle to move markets significantly, with no concern for our open positions. If we can align ourselves with these larger players, rather than challenge them head-on, then our chances of achieving exceptional consistency are dramatically improved. It would not be unusual for a consistent trader, within Futex, to be profitable every day for months at a stretch; this is our unequivocal objective. The ability of novice traders to trade effectively on the basis of their edge is dramatically reduced at times of exceptional volatility. Such market volatility is most apparent in and around economic data releases with the U.S. Employment Situation report one of the prime examples. It may come as a surprise to some that our approach to this particular release is to make money in advance of its release, where we have an edge, and to avoid trading at the time of the release itself.
At the heart of the success of this highly effective approach to trading is an individual’s discipline in the face of seemingly high profit opportunities. Usually there is an inherent tendency for inexperienced traders to jump into the market at the first sign of volatility, what we refer to as the flashing light syndrome. Only with the repeated practice of self-enforced discipline does this tendency dissipate; for those that are not prepared to address this issue, the tendency never disappears and the sought after consistency remains elusive.
Futex Academy is the leading futures training company in the U.K.; a sister company of Futex, one of the industry’s most successful Proprietary Trading Houses. Our joint, enduring success is based on the development of long-term, mutually beneficial partnerships with our traders. This in turn is founded upon a trading approach that is consistently profitable.
Futex Investment & Trading Academy
“The Ultimate Futures Trading Education”
Tags: decision making, discipline, edge, pressure, profit opportunities, volatility
