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• Concerning trends.... This is what I do as an example: I make it easy for a new trend to start and hard for it to end. This allows for the possibility of 2 trends: up and down at the same time.
• If the market is making higher highs and higher lows, the only trend is up. When you get into a so-called choppy area, you may start a downtrend if you are in an uptrend, and it might take some additional work for the up to end. If the market starts up again, the up is still in place and the down ends. You must be able to think in two dimensions at the same time to accomplish this. If you are not used to it, it can be a little confusing.
• It would be like hiring two people to trade for you, one has an agenda to only long the market, the other only short the market. If they are both good traders, in a major uptrend the long side trader should do very well and be able to pyramid, and make a large profit. The short side trader should lose only a little because he uses good risk control. When the market turns down the opposite will occur.
• Trading should be based on setups and trends. During the day try to just react without thinking or over-analyzing.
• Having a plan and working towards flawless execution is a vital component to profitable trading.
• I personally only use one timeframe to determine trend. A second timeframe is useful in helping determine targets. When I use a second time frame for trend determination, I treat it as if it were a separate market.
• Again the most important component to profitable trading is RISK CONTROL COMBINED WITH CONSISTENCY...
• Use whatever you like, no magic to a specific timeframe as long as you stay above noise level.
• Consistency is very difficult, but when achieved you have made it as a pro.
• There are many ways to trade and this is not a comment on them. What I like to do is when I put on a base position trade and it starts to work, I like to add to my position, while bringing my stop towards breakeven. I call this type of trading Campaigning but please use what you are comfortable with, as long as you have the stats on your side.
• Remember: it is YOU AGAINST YOURSELF.
• BEFORE YOU SPEND YEARS hunting for trading success, please spend a few minutes defining what that is.
• Keep a journal -- it will help build confidence.
• Also, a method that is 70% wins is also 30% losers, losses are expected.

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KEYS TO SUCCESS:

1. Set a goal
2. Understand what it will take to achieve your goal
3. Have a comfortable amount of risk
4. Know the trend
5. Know your setups with targets and stops
6. Use your setups
7. Know how to plan a campaign
8. Understand that losses are expected
9. Think in terms of probabilities
10. Stay focused
11. You must believe in and have confidence in your methodology
12. You must have the guts to pull the trigger
13. PATIENCE: you must be able to wait for your setups
14. RISK CONTROL, RISK CONTROL!
15. BEFORE YOU SPEND YEARS hunting for trading success, please spend a few minutes defining it
16. Commit to yourself that this is what you want, and you will follow your RULES
17. Burn into your brain the self image that you are now a successful trader with a method and plan that fits YOU
    

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PATIENCE...HE THAT CAN HAVE PATIENCE CAN HAVE WHAT HE WILL.

• Know and believe in your setups and wait for them.
• Patience is power.
• Patience is bitter but its fruit is so sweet.
• Our doubts are traitors, and make us lose the good we oft might win by fearing to attempt.
  -- William Shakespeare
• Patience is the courage of the conqueror the strength of you against yourself. Beware the power of the patient man, and, always: risk control.
  

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Ross -- Collected Thoughts Part Two

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• Setups - See first that your setup is wise and profitable, that ascertained pursue it resolutely, do not forgo the purpose that you resolved to achieve.
  
• Trade the trend, don’t guess
  
• Don’t think, just react to your proven setups
  
• (When being asked about multiple timeframe analysis) - Yes 1 timeframe is less confusing
  
• Perfection is attained by slow degrees; it requires the hand of time.
  
• Perfection consists not in doing extraordinary things, but in doing ordinary things extraordinarily well.
  
• (When asked about what he trades) - I position about 5 markets and scalp S&P and Bonds
  
• (How do you choose?) - The ones that give me the proper setups I look them all over at night and decide
  
• For those of you that really want to trade as a business, you should have your setups in writing tested and proven. A risk control program that is comfortable also in writing and work on a mental program to keep you focused. If you don’t have these in place and really want to be successful take sometime this weekend and do these things, I guarantee it will help. I also recommend that you pick one time frame in the market to use for trend determination and windows of opportunity. You can use higher or lower time frames to help your entries and exits, but one primary time frame and this will help avoid confusion.
  
• High probability will occur if you use a small target the bigger the target the lower the win % but the better the risk reward, it’s all math. For example if you want to buy when your 210 comes near or below a moving average or your sot is very low and you are looking to buy .you can go to a lower time frame and wait for that to start up. You define your window of opportunity and go to a lower for timing
  
• You have a number of things to control and they can be controlled: percent winners, risk/reward, frequency of occurrence… These are things to determine when designing your trading style. Design what you like but understand what you get and make it comfortable for you. This business is all math and probabilities requiring not only risk control but also self control. Easy to say yes, hard to do.
  
• Conquer thyself. Till thou hast done this thou art but a slave
  
• He who reigns within himself and rules his passions, desires and fears, shall achieve success.
  
• Define YOUR SETUPS in writing. When they occur do it!
  
• Every great trader exhibits the talent of organization of construction. Whether it is in a method, philosophy, system, strategy or setup. And without a method there is no organization, methodology or confidence or real and consistent profit.
  
• Self Trust is the essence of success - Define your setups, test them, accept them, trust them and DO THEM! And have the patience to wait for them...
  
• I have been fortunate to be successful in trading. I have no idea or ability to project what the market will do. All I have is a COMPLETE TRADING PLAN, CONVICTION in what I want to achieve, COMFORTABLE RISK CONTROL, A NUMBER OF SIMPLE TESTED SETUPS THAT I BELIEVE IN and I am always working toward FLAWLESS EXECUTION.
  
• OPINION OF THE MARKET - Nothing so obstinately stands in the way of trading success, as pride of opinion. Just use the setups that you have defined, tested, proven and believe in.
  
• Remember a trend has a beginning, middle and an end. Try to get in at the beginning and hold, that is for position trading.
  
• I strongly recommended keeping your swing charts by hand it helps you see and feel things in the mkt. To each his own it helps me, been doing for 40 years
  
• Now my long trader is waiting for a long setup as we are in a window of opportunity for him, he must have PATIENCE to wait for his set up and he is not allowed to talk to or know what my short trader is doing. In the meantime my scalper does his thing by himself. They each have their own screen with a trade sheet attached. They also have their own rules to follow in writing attached to their screen.
  
• I believe multiple time frames are confusing. I use one time frame for trend and windows of opportunity. I will then use a lower time frame to help in entries, and a higher for targets. An example: If the time frame you use is in a downtrend for example a 3 min is in a downtrend up wave retracement, the 1 min is up wait for the 1 min to turn down that could be your short entry stop basis 1 min. Target basis the 3 or a higher time frame but the 3 (or what you like) is your primary indicator of trend and window of opportunity.
  
• (Speaking about some of the recent grain trends) - The perishables or consumables tend to trend better as their is real supply demand in those markets
  

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THE NUMBERS GAME -

Question

Trade A wins 90% of the time risk reward 1:1 you make 10 trades 9 wins 1 loss net profit 8 pts.
Trade B wins 20% of the time risk reward 1:15, 2 wins +30, 8 losses -8. Net profit 22 points.
What trade do you want to play A or B?
Both will repeat with consistency

First, if you are winner 90% of the time you go out to 2 standard deviations to have 4 losses in a row so you could fund this with 4 units of risk. If you have 20% wins you can go out 2 standard deviations to get 22 losses in a row

So with a funding requirement of 4 risk units you can make 8 units profit or 200%. With 22 units of funding you will make 22 units of profit or only 100% on funding, plus I doubt that you can continue with 10 to 20 losses in a row and is not highly probable.

Question

Choose trade A or B....A is winner 100% of the time average profit $1,000.
Trade B is a win 50% of the time average profit $50.
I left a piece out, choose A or B.

Theoretically A occurs once a month B occurs 4 times a day, now choose.

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THOUGHTS ON MENTAL PREPARATION –

Even though I have been at this for forty years I still do the following:
First it is important (a must) to have your setups in writing and a risk control program in place.
I listen to a tape 3 to 4 times a week called mental harmonics programming for successful trading. This is a tape prepared by Robert Krausz, an old friend of mine, it hypnotizes you into full belief in you and your methods. This is a tremendous help and very relaxing.
Second I was taught by Ed Seykota to learn how to breathe properly once a week. I would go over to his house or he would come over to mine on a Saturday and we would spend the day doing deep breathing and eating fruit.
I would lie on the floor with Ed spotting me and do very deep breathing for thirty minutes rest for 15 min then he would do the breathing very deep and I would spot him. It was amazing the clarity of thought that developed and stayed for the week...
This business is so easy but it is so dependent on a good mental attitude.
I still do this on Saturdays, it really helps.
I strongly advise some form of meditation and breathing exercise.
You can put all the trading tools in place and without the proper mental attitude it will be very difficult to execute properly.