Updated: Mar 13, 2019
Being choosy pays off and pays well. And the rich knows it.
"...Got to believe in magic
Tell me how two people find each other
In a world that's full of strangers..."
David Pomeranz says it's magic. I say it's CHECKLIST.
Ever heard of “rich people are rich for a reason”? Ever wondered what that reason is? While the second-gens have the advantage of being born rich, their self-made oldies have taught them something in one way or another enabling them to preserve wealth. That is, having a standard. Not to make them look rude or anything, it’s just how they roll.
Opportunities are everywhere available to all walks of life. Yes, it’s not exclusive for the rich! They are just trained enough to pick who or what to invest in.
Keyword: INVEST. Investing is not all about money. It is everything you have, everything you can offer—time, energy, and resources. And the rich know these things are limited. Our time has 24 hours a day. Human vitality has an expectancy of 80 years. And money is just as numbered. So, they’ve got to pick the best. Best life partner. Best deal. Best shirt (e.g. Steve Jobs, Mark Zuckerberg).
Now, defining the best is where we may haggle. Checklist defines the best. This Earth has billions of people you cannot possibly meet each one. Same with trading. Err, not exactly, as trading has obviously fewer markets to see. Anyway, the point is—checklist helps you narrow the search down and focus on the good that has the potential to be the best.
But what’s in a checklist, really? Well, it’s mostly preference. Like how some people likes toy dogs than the big ones. Like how some people don’t like dogs and prefer cats instead. Like how some people are not into pets at all! In trading, some people are into the long-term daily trades while others are into the 15-minute charts. Some are okay with all bar patterns while others particularly wait for engulfing. This is when you ask yourself what you like then, check ‘em out.
As for me, my checklist is similar to SBS Running Man’s Song JiHyo (photos above):
What shape does the chart make?
Identify if it's a trending market or is it a ranging market. See if there's a figure pattern. You may google patterns such as cup and handle, head and shoulders, and double top/bottom. The price movement has historical tendencies. About 70% of the time, it plays around familiar territory. The other 30% is when it explores and breaks out to new highs (or lows).
Honestly, I had a difficult time identifying and accepting shapes of the market. I've come to realize that this industry is very much humane. My checklist even has human reference. Because it is! Behind those price movements are people who can be crazy competitive, moody, or just plain emotional.
The market is imperfect. It may or may not get in ideal shape. But ideal shape is a point of discussion. You know, when someone says "think of a dog" I bet every single one of us has imagined a different dog. Still, it's a dog. Now, for forex exercise, think of an uptrend market.
Does it have power to go strongly in a direction?
The currencies in the Forex market go in pairs like GbpUsd, UsdJpy, EurGbp, etc. It's as if two economies matched together in a tug-of-war. The prices would move according to the strength of an economy. That strength, on the other hand, has many other elements to it. This is where the Fundamentals come in, which I think must have articles on its own.
But to give you an idea, fundamentals are what you see and hear on the national news. I was once advised to read on a daily basis. Didn't work for me 'cause I'm a lazy human being. But YOU maybe not. So, try it. Anyway, I found other ways to know an economy's strength. Will share it on the Exclusives section :)
Are the signals looking good?
If you're as lazy geeking on fundamentals then, compensate on Technicals. Most of other forex sites talk about this. I may hook you up with some as they too have supplemented my knowledge. But at the very least, I want you to geek on Price Action. Price Action makes signals whether the market is ripe or not for trading. And while you're at it, please get to know Support and Resistance.
Some likened these to The Holy Grail. Others don't dare. Understandably, it's because no matter how good-looking something is, nothing lasts forever. The market will do what it does. But if I may, I would say that this is the standard of beauty in the forex trading industry. Holy Grail or not, knowing these is an edge for sure. You indefinitely increase your winning probability. And that's good enough.
If I get most checks on my list, I go and say hi! To the trade, of course :)
Happy trading everyone!
@marilesaca || Trading Kitten :3
How about you? What’s in your checklist? Tell us about it on the comment section below!
Sign-in to access my detailed checklist in the Exclusives section.