Robert Prechter’s Five Tips on Trading Successfully

Sep 15, 2009: 9:35 AM CST

I’ve read these tips from Mr. Robert Prechter (of Elliott Wave International) previously, but here are five quick tips he succinctly shares with students and readers:

1.  Have a method to trade.
2.  Have the discipline to follow your method.
3.  Get real trading experience, instead of only trading on paper.
4.  Have the mental fortitude to accept the fact that losses are part of the game.
5.  Have the mental fortitude to accept huge gains.

The first four are becoming common knowledge – it’s the 5th and final point that is somewhat out of mainstream that can make all the difference.

Mark Douglas also mentions this concept as being critical to long-term trading success (in his Trading in the Zone book).  Sometimes when we make a quick or large profit in the market, we feel guilty about it, and compare it to how long it would have taken us (in hours) at a current or previous non-market related job.

“That gain I just made in one day was like working a full day at my old job!”

We so often desire large profits, and when we get them, sometimes we just can’t believe it… and sometimes we sabotage those gains by guilt or over-complacency (or by taking excessive risk by playing with “house money”).

Either way, I wanted to share these tips with you (with permission) as well as a link to the larger (free) page that contains a brief Q&A excerpted from Prechter’s Perspective from which these tips are drawn.  In this Q&A, Mr. Prechter describes the importance of getting a mentor and shares some of his experiences.

Also, if you have not done so already, get your 47-page e-book copy of part 1 of the “How to Spot Trading Opportunities” e-book which is free for you to download only until September 23rd.

Thank you to the staff at EWI for making these available to us!

Corey Rosenbloom, CMT

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