市場新聞與洞察

In a previous article we introduced the SIX steps to improving your trading discipline and offered some guidance on developing “awareness” with a downloadable ‘checklist’ for you to complete. Before we start, If you haven’t seen this article, it is perhaps prudent to go now and complete the checklist as this will inform you for this second step. Click Here The second step has two sub-steps that are critical. 1.

From those areas you have identified in the checklist as requiring work which are the most important to work on. 2. Once you have nailed down your priority area, explore the reason why this may be, to provide you with a focus on what it is you must work on. Prioritise your discipline areas One of the challenges we often face is that if there are several different areas to work on in our development (both in and out of trading), then this can seem very “big” and sometimes overwhelming.

For new or inexperienced traders this feeling of overwhelm may often be a barrier to take any action. So, it seems logical to focus on one issue at a time to make things seem more manageable and achievable. Additionally, and looking forward to later steps, one of the other benefits of this approach is that success in one area will often provide a confidence and the motivation to tackle other areas.

In terms of what we should choose, with the list of areas you will have already identified, there will be some which may potentially have a more easily defined impact than others. An example of this may be that, if you have a trading plan and yet you are consistently failing in executing exits as you should, this would have a major impact on results. So, to the practical aspect once again, with your list, allocate a score between 1-5 re. potential impact you think addressing this area of ill-discipline may have on your results.

This should help you choose the “one”. Identifying the cause. Potential causes of ill-discipline, although sometimes dependent on the situation, can be many.

Here are some of the most common causes (you can get clues from what your internal voice is telling you). 1. A choice that trading is not of enough importance to invest the time/effort needed. (So, “I haven’t got the time”) We all allocate time to trading activities. Such time may be effectively invested in things that could make a difference or otherwise.

Additionally, although we are not suggesting that trading should take over your life, there is a need to ringfence some time (rather than watching reruns of “Law and Order’ to put some hard yards in at the front end to have the right things in place). So, you have two choices to make. a. Do I choose to ensure I have ringfenced the time to do the things I need to become a “committed” trader? b.

Do I choose to ensure that the time I do allocate to trading activities is invested in the right things, e.g. Recording my trades in a trading journal or unfocussed skipping between “interesting” news, or often useless trading forum chatter? 2. Don’t know what to do (or perhaps, “it’s too hard”) OK, so there may be a ‘knowledge gap’ in terms of the “how-to” make something happen.

For example, you may believe that there is merit in making your trading plan statements specific enough to facilitate consistency and measurement, but you are not quite sure where to start. Two key points here... Firstly, as with any part of your trading development planning, you need to refine the question you are asking, then seek out appropriate resources and of course finally to follow through on asking for what you need.

GO Markets has platform support and educational support to help you on your journey. Perhaps you are not asking as you feel you should already know the answer or maybe even that you think your question may be “stupid”. Remember there is no such thing as a stupid question, and surely it is far less wise not to ask if the support is there.

Secondly, sometimes when faced with multiple issues to resolve it may seem overwhelming or perhaps taking on new knowledge is something that does not come easy. Think about your journey so far. I am sure there are things which you didn’t know at one stage that now come easy.

Why shouldn’t additional learning be the same? Quite simply, you must step up to the plate and find the answers you need. 3. You have not been specific about what you should do and when you should do it Ambiguity in a trading plan or system is one of the potentially most damaging issues on an on-going basis.

We frequently extol the virtues of having enough specificity in all your trading plan statement to facilitate consistency in action and the ability to measure your trading actions accurately and meaningfully (so as to make adjustments if needed). To remain in a state of uncertainty in action as you have not got sufficient and specific individual guidelines to use in the “heat of the action”, clearly does not serve you well from a discipline perspective. Additionally, it may be that your trading plan is incomplete.

Perhaps it does not cover all market scenarios or may have enough detail regarding trade entry but lacks the same rigor relating to exits. The solution here is obvious. Work need to be put in to make your trading plan as robust and specific as it needs to be.

We have written a previous article on this, so if this resonates with you then perhaps this would help (Insert link). 4. Don’t believe something/you will make a significant difference e.g. your existing system, a new system, a new piece of learning. Clearly if you have little faith that a particular action, be it part of your trading plan or the need to implement a system such as journaling, is going to make a difference to your trading results, then you are far less likely to action.

Adult learning theory is full of references to the need for relevance before learning action is taken and of course much of this is based on having some evidence that something will make a difference. Here is the problem, without evidence of at least some tangible difference you are less likely to act and yet without action you are not going to create the evidence you be sufficiently motivated to do something. We are going to discuss gathering evidence in detail in other articles within this series but for now it is probably sufficient to say, that if the only way to create the evidence that something will work for you then surely it is worth even dipping your toe in the water to find out a little.

This may be enough to give you the will to subsequently try something out for longer. 5. In-built trading ‘heuristics’ (cognitive biases) or a belief that the market is “wrong”. Our final point of the common fives is some of the in-built “wiring” you may have.

People who come to trading have an inbuilt set of belief and value systems that develop through their lives through instruction from others and experience. These inbuilt systems are termed cognitive biases, and in many instances in the ‘heat of the action’ take over from your written and planned ‘trading system’, even if you strongly believe that your system is good, influence on your behaviour in the market. Results that you may produce from your trading can reinforce these inbuilt biases making them more acute, and so have more and more influence on what you may do when in the market, until finally they end up destroying the capital and so confidence of the investor.

There are many such biases documented in an area of study termed behavioural finance. Six of these seem to be commonly described namely: • Loss aversion bias, • Recency bias, • Outcome bias, • Sunk cost effect, • Minimalisation, & • Disposition bias. We will explore these in detail in future articles, but these may be a contributory root cause particularly of execution discipline with direct trading action.

So, with our five root causes covered, onto your missions for this second step (key question…Are you going to push through an exercise the discipline to follow through?): Consider the potential causes (listen to your internal voice) and begin to identify what cause(s) may be relevant for you. Make notes on anything you identify to get more detail “inked” on paper. Watch out for the next article in this series where we will explore starting to gather enough evidence to change potentially ill-disciplined behaviour into actions which may serve you well.

With very rare exceptions every trader must battle with trading discipline at stages in their trading career. Commonly when we explore trading discipline, there is an obvious focus on what we will term “execution discipline”, that is engaging and following through with elements of your trading plan e.g. adhering to a pre-planned exit strategy. However, becoming a better trader is more than simply doing what you say you will do with direct trading actions.

It also involves developing a structured plan for learning trading (fostering improved knowledge and confidence), creating those systems that support the development of that plan you intend to execute, discipline in learning and system development. Quite simply, discipline in learning gives you the tools to develop and creates effective systems (and measure them) without these, and a subsequent belief and confidence that they could work for you when trading, it becomes significantly more difficult to be disciplined in the execution of direct trading actions. So, in reality all these areas are interrelated in terms of potential trading outcomes.

With many traders knowing where to start and what to do to address the challenges of mastering trading discipline is a barrier to moving forward. In a recent ‘Inner Circle’ session (find out more about joining this group here ), we aimed to assist those in this position and outlined a six-step process to facilitate this. These steps are: 1.

Develop awareness and OWN your behaviour. 2. Explore potential cause(s) and prioritise areas for “work”. 3. Create the motivation to consider change through evidence. 4.

Action plan and follow-through 5. Lock in the new change 6. Measure and move on to next issue.

This first article in this series focuses on the first of these steps, with subsequent articles addressing the other steps. Developing awareness of where you are now not only assists in providing a benchmark as to where you are now but allows prioritisation of areas to address that will tighten your trading behaviour. Additionally, of course, through doing an exercise to develop this awareness, this facilitates some “ownership” of where you are now, i.e. being responsible for what you are doing well, and more importantly what areas need improvement.

This is invaluable as it moves away from the all to common blaming of the markets, or your system for your results. After all, two things are clear and indisputable: a. You have control and responsibility for all trading actions and hence are completely responsible for the results you get from trading.

This includes creation and evaluation of the trading system you are using. Logically, although this fact seems to escape many, you can’t even reasonably begin to “blame” a system for your results until you are following it religiously. As soon as you stray it becomes a “you” issue, rather than a system issue. b.

You are in control of what happens from now. Previous results, and the behaviours that led to these, serve only to give you “feedback” as to what you need to do next, the good news being of course that you CAN, with the ownership of discipline issues, make the changes you need to. So, with the theoretical justification covered now onto the practical.

To assist in your development of this ‘awareness’, crucial to the subsequent five steps, we have a “15-point discipline checklist” for you to download and complete to give you this opportunity to benchmark and consequently begin to prioritise and work upon. Although we previously referenced the interrelated nature of the three critical discipline areas - discipline in learning, discipline in systems, and discipline in execution, we have used these three areas as a framework to make identification of those areas that you need to work on, a little easier. So, your mission is clear for this first step: a.

Download the attached checklist below b. Complete it and then identify the three areas you think could make the most difference to your trading c. Watch out for the next article in this series where will give you additional information to move onto step 2.

Discipline checklist amended 3

The ability to set up phone notifications for trading activity on your MT5 platform has many advantages including of course the opportunity to “Check-in” on the market whist on the move. It could be argued that this ability goes beyond simple convenience and in the case of “pending orders” could be viewed as an important part of risk management of trades that are opened through this method. Pending orders revisited Pending Orders are advanced entry orders that allow you to place an order onto the system that will be filled at a specific price level.

The key potential advantage is that you don’t have to be watching the market continuously for an order to be filled, and it can be filled at any time if the order is still active on the system. An example could be placing a “Buy Stop” order above an identified resistance level, so if the relevant currency pair or CFD moves to this price point then the order will be filled at your chosen price (You can still place a stop loss and profit target associated with the pending order). Although it a potentially attractive function of your Metatrader platform, one of the potential disadvantages is that without notifications set up you may not be aware that a trade has been entered until you are in a position to look at your trading platform on your PC for example.

Without this awareness of an “open” trade, the implications are: You will not be able to adjust a “trail stop” to lock in potential profit if the trade does go in your direction In the event of imminent economic data, you will not know to adjust such open positions to manage risks associated with this. Setting up phone notifications on your phone, is not only relatively simple but mitigates these potential disadvantages. Setting up notifications We will walk you through the set-up process on MT5 but is similar if you are using MT4.

Download the MT5 app on your mobile phone Allow to send “notifications”. Check in phone settings that it is set up. Open the app and go to messages in settings and find your Metaquote ID at the bottom of the screen.

Make a note of this (See diagram below). Open the MT5 platform on your PC In the tools menu, click on options and then the notifications tab. Enter your MetaquoteID in the pop-up box as shown below.

Click on test You should receive a notification on phone that set up is complete and subsequently with any orders you place and that are filled. Of course, feel free to contact the GO Markets team if you need additional support in setting this up at any time.

Many traders have the prudent approach that treats trading as you would a business. A critical component of this is to have a thorough knowledge of your expenditure in relation to your trading activity. With Share CFDs these are potentially fourfold, namely: Your cost of trading (e.g. brokerage) Your cost of holding a position The cost to enter a trade (your margin requirement) Potential cost of the data feed (for non-traders) Brokerage Traditionally, using a broker to trade shares incurs a fee for services of the placement and exit of a trade termed brokerage.

This is usually organised as a minimum flat fee or a percentage of the trade entered, whichever is the higher figure. The majority of Forex traders are used to not “officially” paying a brokerage. However, the bid/ask spread could be logically viewed as the cost of entry, as if you were to close a position immediately then you would be paying the difference between bid and ask prices.

Hence, although with shares you are essentially in a loss situation at the start because of brokerage, with Forex you are also in a loss position at the start of a trade, due to the spread. With CFD share trading, the brokerage applied to entry and exit is 0.08% of the overall position exposure or a fixed minimum charge of $10 - whichever is greater. For example. if you had entered a position with exposure of $10,000, the brokerage cost of this trade would be 10,000 x 0.08% = $8, therefore this would attract the minimum $10 brokerage.

Alternatively, if the position was exposure of $20,000, the brokerage would be $16. This will be considered in your profit/loss column on your platform. Holding costs As with Forex trading, if you choose to trade longer timeframes involving holding a position overnight, there is a debit or credit applied to your account for this.

This charge is dependent on the direction of the trade (i.e. long or short) and the ‘swap rate’ applied to the position direction. The value is calculated using a base rate of 2.5% and then: If it is a long trade the interbank rate is added to this If it is a short trade the short interbank rate is subtracted from this Rather than having to find the interest rate and doing the calculation yourself, to make it easy for you, the swap rate can be found by right-clicking on the CFD in the “market watch” box of your trading platform and subsequently clicking on “specifications”. Scrolling down the pop-up box will reveal the swap rates.

For example, on the day of writing this article the swap rates for BHP are as below So, a long trade with $20,000 of exposure to BHP with a swap of -4.05 is charged as (20,000 x 4.2%)/360 = $2.25 per day. Again, this daily holding charge (applied at 4.59pm US EST) will be visible on your trade box on your platform in the swap column and taken into account in your profit/loss column. The cost to enter a trade (your margin requirement) As with Forex, with CFDs you have the opportunity (as well as being aware of the risks) of using leverage to enter positions.

Unlike Forex, there is not a set margin, so as with index CFDs, each equity CFD has its own set margin level. Again, these may be found in the ‘specifications’ box. For example, ANZ has a margin of 0.05 or 0.5% applied, whereas with BHP the margin applied is 0.075 or 7.5% (See below) So as an example, If we take BHP at this margin rate and we open CFDs to the value of 10,000 the margin requirement on this position will be $750.

The potential cost of the data feed Most global exchanges, including the ASX, charge for a data-feed of live prices and other trading information e.g. volume. Often, these are passed onto individual clients, however, as part of the service we offer, you will get this live feed at no subscription charge whilst you are actively trading. Some of the information described above may be new to you, so if you need some clarity you can simply get in touch with us and we will always be happy to help.

When we first start to trade, or subsequently (as a more experienced trader) when we trade a new symbol or system we are often “excited” as we see a “hope” for better results. We often forget that the development of expertise in other areas we have in life (think about what you do in work now for example), you must invest time, effort, learning and making mistakes (providing you acknowledge and learn from them) to develop. This is not an overnight transformation, rather it may take several weeks if not months before you feel confident in your knowledge and skills.

It is bizarre therefore that we should expect anything different with trading development. To be clear, we respect and commend those who take the leap and move from demo to live account. After all, a demo platform ( you can trial a MetaTrader 4 or MT 5 demo account here ) will serve you in learning how the platform works, how to add indicators and get used to how markets move.

However, it is only when you start to have some “skin in the game” and are trading YOUR money, albeit with tiny positions to start with that you learn the most important lessons in trading and develop the appropriate mindset to begin to think about trading larger positions. All that been said, we see time and time again new traders or those trading a new system exhibiting three cardinal sins of the developmental trader, and decide to trade: a. With positions that are too big b.

Short cutting learning and system development c. Strategy skipping (i.e. moving from new system to new system) without meaningful measurement as to what works for you (and what doesn’t) or indeed whether the problem is YOU failing to trade a system religiously. These are all symptoms of impatience, of wanting to get massive returns quickly and without putting the hard yards in at the front end.

Remember this... The purpose of your trading when you start trading a live account should not be huge profit, rather it is to develop the confidence in your system, consistency in action and the measure whether what you are doing could be improved. Although it may seem strange to suggest, it is this and not, in the early stage of trading, the money (and level of profit) is most relevant in your potential lifelong career as a trader.

It is through patience, and adhering to that initial purpose that you can gain sufficient confidence and competence to trade larger positions (after all it is just moving a decimal point to go from 1 mini-lot to a standard lot) and put the right foundations in to move forward. Exercising patience to have the right things in place will serve you well for a potential lifetime of trading, to be impatient may mean your trading lasts but a few weeks or months. It is really that simple.

With the Brexit negations dominating the news flow over the last few weeks, you may forget there are other events taking place. On Thursday, the European Central Bank will announce its decision whether to increase, decrease or maintain the interest rates. The decision is scheduled to be announced at 12:45 PM UK time.

Why Is The Announcement Important? The European Central Bank is the central bank for the Eurozone, the countries which have adopted the Euro, including Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Portugal, Slovakia, Slovenia, and Spain. ECB’s decision to increase, decrease or maintain the interest rate has a significant impact on the financial markets because changes in interest rates affect the exchange rate of the Euro, so it is one of the must-watch economic events in the calendar.

Expectations The European Central Bank has not changed its interest rates since March 2016 and analysts are forecasting that the rates will also remain unchanged in the upcoming meeting. All eyes will be on the European Central Banks President, Mario Draghi’s speech shortly after making the announcement. Hot topics will involve the Italian and the Brexit process, which has developed into complete chaos.

The French budget is another issue to address for the ECB after the French President Emmanuel Macron gave in to the recent anti-government protests by the ''yellow vest'' movement which will cause France to exceed the European Union’s budget deficit ceiling next year. Other ECB data releases to keep an eye out: ECB Marginal Lending Facility (12:45 PM London time) Previous: 0.25% Forecast: 0.25% ECB Deposit Facility Rate (12:45 PM London time) Previous: -0.40% Forecast: -0.40% This article is written by a GO Markets Analyst and is based on their independent analysis. They remain fully responsible for the views expressed as well as any remaining error or omissions.

Trading Forex and Derivatives carries a high level of risk. Sources: Go Markets MT4, Google, Datawrapper