Weekly Perspectives: The Difference Between Amateurs and Professionals

Weekly Market Outlook For November 4 – 8, 2019
November 2, 2019
Weekly Market Outlook For November 11 – 15, 2019
November 9, 2019
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Weekly Perspectives:  The Difference Between Amateurs and Professionals

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VXX melts and indices hit all-time highs –

It was a wet and windy Halloween in Montreal this past week but neither Mother Nature nor City Hall could keep my kids from getting their candy this past Thursday.

On the trading front, the final trading week of October showed that once again we are trading in a bull market as the NA indices navigated the volatility from Wednesday’s FOMC announcement as well as earnings reports from AAPL, FB, and GOOG culminating in a record all-time high close on Friday for the SPY and QQQ.

With the month of October now behind us, in this week’s video, I make the case why we are unlikely to see the Q4 meltdown we had in 2018. Hint – it has to do with market structure and timing.

As a further resource, I mention another video where I do a deep examination of price and time of some of history’s major market reversals and you can find that video here.

Bitcoin and Ethereum spent most of the week consolidating the recent gains and this coming week we’ll want to keep a careful eye on how this inside week breaks as this will very likely be a great trading opportunity.


Watch this week’s Weekly Outlook video to see the setups and levels we’ll be watching.

In this week’s video, we look at the technical outlook for the VXX SPY QQQ IWM DIA EEM TSX TLT GLD SLV BTCUSD ETHUSD EEM and more for the week of Weekly Market Outlook For – November 4 – 8, 2019.

Feel free to drop any questions into the comments and hit the subscribe button to receive notices of our weekly market analysis videos. 

 

The difference between amateurs and professionals – 

“What the pupil must learn, if he learns anything at all, is that the world will do most of the work for you, provided you cooperate with it by identifying how it really works and aligning with those realities. If we do not let the world teach us, it teaches us a lesson.”   Joseph Tussman

What’s the difference between an amateur trader and a professional trader?

This article from Farnam Street shows there are a host of other differences, but they can effectively be boiled down to two things: fear and reality.

Amateurs believe that the world should work the way they want it to. Professionals realize that they have to work with the world as they find it.

Amateurs are scared — scared to be vulnerable and honest with themselves. Professionals feel like they are capable of handling almost anything.

So here’s an exercise I often recommend to traders I coach to shift your thinking from amateur to professional.  Take some time and work through it this week.  

Define SUCKER

Here are some characteristics of a sucker:

  • Suckers think they can figure it all out themselves and outsmart the market. 
  • Suckers are always looking for hot tips.
  • Suckers think there are secret systems and indicators. 
  • Suckers think they can avoid losses.
  • Suckers overtrade
  • Suckers don’t apply stops because they know they are going to be right. 

Now it’s your turn:

Write down all the traits of a sucker.

  1. Do you spot any of these traits in yourself?
  2. Turn it around, where and what do you need to develop to shift from being a sucker?
  3. Review your sucker traits on a regular basis.
  4. Try out this exercise and email me if you notice a change in your trading. 

Happy trading,

Houston

PS – Feel free to share this newsletter and our videos so we can reach more traders!

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Weekly Perspectives: The Difference Between Amateurs and Professionals

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