Category Archives: Education

11 Apr

1-day course on trading techniques in London

Dear traders
It is a rare event when you can place two trading personalities at the same place at the same time. On the 28th May 2016 the legendary US trader Larry Pesavento and the Danish day trader expert Tom Hougaard will give a 1-day course on trading techniques in London.
It will be a long day, but not boring. The two have decided to split their time between them over a full day of education.

1-day course on trading techniques in London includes:

  • You get a course handout with the techniques Tom used to generate 38% in just 5 sessions.
  • It is the same techniques he used to generate 137% in one year.
  • You will get Larry’s book as well as being taught by the legend himself.
  • You will be on his alert email list for 30 days after.

Take a look at the complete day and book here

1-day course on trading techniques in London

 

1-day course on trading techniques in London

07 Apr

When Everything Goes Wrong

The next time you go through a tough period in your trading, and you are thinking about taking a break, do me a favour: please read this brief post.

I have a question you need to consider. Which one of these two scenarios do you closest fall into?

quote true adventure begins-when everything goes wrong

Scenario 1:

You have been trading like a man on fire, and you have very quickly built up your trading account. Maybe you even doubled the account or quadrupled it – maybe more. The market environment suited you, and you were able to capitalise well on the market movements. Yes, you did have losing trades, but it didn’t bother you. You were in control of your trading. You took the losses and you did your best to let your winners ride.

Then from one day to the next day things changed. It started off slowly. The peak of your account was behind you, and you seemed to struggle to read the market well. At first it was just a normal drawdown, but then it turned ugly. You had a really bad day or bad week, and it only stopped, when the day ended, or the week ended. You lost a significant portion of your gains. You were still up, but you were far away from that equity peak you were so fund of and proud of.

The next day or the next week you were back in the saddle, and you felt ok about yourself. You realised that losses are a part of the trading profession. Yet somehow you could feel yourself placing trades that were bigger and more desperate than previously. It was more of the “hope” kind of trades than trades based on sound technical or other considerations.

It wasn’t long before you continued where you left the previous day or previous week. Now you are very unhappy with yourself. You have realised that you need to stop right now.

Is this where you are?

 

Scenario 2:

You have been trading with some success but you also had your fair share of big losses. You have perhaps traded well all day only to lose it all on some final trade of the day. It may be that you have traded well all week, but on that Friday afternoon, you gave it all away.

Your account is below where you started, and you jump from one market to the next, without really knowing what you are doing. You feel ill equipped, and you don’t really know what to do next.

Is this where you are?

 

Moving forward

I have losing periods too. I go through these periods with a sense of “regret”. I know intellectually that they are part and parcel of my trading life. Nevertheless it always seems to catch me by surprise when it happens.

It shouldn’t surprise me. There will be times when I am trading like a demon, and there will be times when I am trading like Blind Freddie.

However, the two scenarios above require a different approach. I accept you may not fall in either category perfectly. So I recommend that you read the solutions to both situations, and you see what you can take away from the suggestions?

 

Remedy for Scenario 1

You need to step away from screen for a day. I recommend this because staying in front of the screen can tempt you into trading.

You need to ask yourself: Is there anything you could have done differently?

If there is, then you need to do something about that. If there is nothing you could have done differently, and you have a good methodology, then take a break. The market will be there tomorrow. Right now your body is chemically not in balance, and you are going to experience some very powerful thoughts about getting back to “the peak”. You will get there, but right now, you need to step away until you feel like you are in balance again.

If there is something you could have done differently, it is most likely one or more of the following reasons:

  1. You overtraded and you chased the market.
  2. You were so desperate to catch the next move that you got whipped on the long side and the short side, or you were overtly bullish even though the market kept stopping you out.
  3. You traded too big to make up for the losses you made previously.

What I recommend you do is as follows:

Get the data from the period where it went wrong. Print out the day charts for the markets you traded, and plot the trades on the chart. This will give you a visual representation of what you are feeling: the loss. You will see the loss for what it is.

So what is the loss? Your particular loss could have been just like any of the other small losses you have had, and that you gave no thought to. Yet somehow this loss or these losses cost you a lot more. You either traded too big or you gave the trade way too much leeway.

Whatever the reason, make sure something good comes of it. There is nothing like a little book of “big mistakes” to remind us of the ever-lasting truth in the markets: We are on our own in the markets, and either we learn from our mistakes or we don’t. If you don’t create a little memory of this “un-memorable” moment, then you risk the lesson will be forgotten.

 

Scenario 2:

I was once in Scenario 2. I moved away from this when I got some trading techniques that worked well. I recommend you spend some time working on two matters:

Develop some solid entry techniques by doing your own studying or pay someone to teach you some solid techniques. I teach solid techniques, but this is not a marketing pitch. This is a suggestion to the path you need to take from here. There are plenty of avenues to take when it comes to education.

Whatever you do, please make sure they suit you. You need to work with techniques that fit your style of trading. Mechanical entries are great like that because they tend to be “time scalable” to suit a time frame that fits you.

The second thing you need to consider is to work on yourself. I have written a trading psychology manual on this subject. The point to take away from this (irrespectively of you are reading my manual or say the book by Mark Douglas about trading psychology) is that we often make the best trades when we are in perfect balance, and we have a clear idea of what we are trying to achieve.

When I am in my most balanced self, I trade well because I am patient, and I am flexible. If I lose one of those two traits, I tend to not trade well.

I hope this will help you. If I can help you any further, then please drop me an email using the form on the contact page.

Kind regards

Tom

Tom Hougaard

07 Apr

Be careful who you listen to

I am deeply distrustful of what I read in the newspapers or see on TV.  There is always another side to the story, and I often don’t get to hear about that side.

I spent 9 years of my career talking to financial journalists. They would call me during or after the trading day to ask why such and such an event had taken place. Why did Vodafone rally? Why did IBM fall?

If I told them that Vodafone rallied because it had broken above its high from 6-months ago, then I would not be quoted in the paper the next day. If I told them that the rumours in the City was that Vodafone was poised to announce quarterly results which was above expectations, then I would find my name in the paper the day after.

If I told them IBM was selling off on rumours of disappointing sales in Asia, I would get a quote in their column. If I told them it was because IBM was making new monthly lows, and short-term traders were jumping on the band-wagon, I would not be quoted.

So I have a fairly good idea of idea of what is rubbish and what isn’t, when it comes to news reports. In general I stay well clear from mainstream media. I NEVER listen to news during the trading day. I am aware of news reports coming out, and I make sure I take the necessary precautions.

My friend and legendary trader Larry Pesavento sent me some images of the Dow Jones Index with various newspaper and magazine front page quotes next to them.

From the 1970’s the business week front cover story of December 1972 proclaims that the bull market will continue in 1973. Business Week timed the top with that headline. Dow fell relentlessly for the next two years.

1970s chart

 

The 1980’s weren’t short of a few ill-timed headlines, such as Fortune’s bullish call days before the 1987 crash.

1980s chart

1990s chart

2000s chart

My own favorite is from 2000, where I read a headline discussing the NASDAQ, stating that “in this new paradigm, profits don’t matter”. Within a month NASDAQ had started the bear market which was to shave off 83% of its valuation over the next 3 years.

Be careful who you listen to. Even so-called experts, world recognized authorities, may have an agenda, which they don’t tell you about. I firmly believe that talk is cheap, and that everything you need to know is in the price. Price is king. Learn to master price and the rest will fall into place.

You might want to read this article

http://www.marketwatch.com/story/how-much-do-profits-matter-to-stock-market-returns-2016-04-01

Tom.

Tom Hougaard

09 Mar

Personal mentoring

Personal 1:1 mentoring is designed for those who want to learn my secret technique which I use for myself and in the live trading room to trade stock indices like the DAX, the FTSE and the Dow.

In 2014, the WhichWayToday live trading room generated 135% in profits. Of those 135% I generated 110%. This was done trading only from 8am to 10am.Tom Hougaard Personal mentoring

Interview: It is an absolute necessity for you to talk to me before we engage in a personal mentoring relationship.

The personal mentoring will start in June 2015. If you want me to send you more information, then please register your interest with the room administrator Hayley on hayley@whichwaytoday.com

16 Feb

Your Mind Is Your Enemy – Part 2

When I made the decision to fast and go raw for a month, I immediately received a mental boost. It was a curious sensation. It felt as if I had already achieved my goal, and somehow I had already received my reward. However, once the fast had begun, and I got through day one and day two, I learned something very important about goal setting and time.

(I suspect that) Most people never factor in time when they make a plan. In my case I experienced the concept of “time” of a 30 day fast in a matter of seconds. Not for one moment did I stop to question how long one day is, when you are not eating, let alone a whole 30 days.

Eating is the one constant in our lives. We may not think about it, when food is abundant around us. If you take away food, as you do when you fast, you quickly realise how big a role food plays in your life. Food comforts you. Food brings you together with family, and with friends. It binds you together, and it sets the scene for nourishing not only body but also mind.

When you strip away that factor, as I did voluntarily, you learn about time. When people around you eat, and you don’t, time pass very slow, especially if you are hungry. By drinking the juice I was able to carry on not taking solid foods, and I was able to keep focused on my goal. The juice nourished my body and my dream of fasting for 30 days.

However, it was TOUGH going, and it was a lot tougher than my mind could have imagined when I was considering doing the fast. I made an important realisation:

When you set a goal for yourself, you get the reward twice. You get the instant reward of imagining the successful completion of your task and achieve your goal. You also get the reward again when you actually achieve the goal, and THAT IS THE DANGER.

Most people are satisfied just to talk about it, and receive the chemical brain boost it gives them imagining the achievement of their goal. For most people they never realise that this is the danger. The mind has cut out all the hard part and jumped straight to the goal line. It has stripped away all the pain, because it is wired to make your life as painless as possible.

Think about it a moment: Have you not made resolutions that you failed to commit to? When you made the resolution, did you not feel a boost? Did it not make you happy to think about stopping smoking or getting up at 5am every morning to go to the gym, but once you started the actual process, the fun quickly disappeared.

I wonder if this is the reason why so many people make promises to themselves, which they never fulfil: because they receive a bodily euphoric high by conceiving the plan/the dream/the goal, but to actually achieve it means you have to live it minute by minute, hour by hour, and day by day, until it becomes a reality, and once the bodily euphoria wears off, there better be something very compelling to look forward to, to drive you forward in the face of the mundane repetitious run-of-the-mill every day experiences we all go through.

One of the great motivational writers and speakers of the 21st century is Anthony Robbins. He has written bestselling books such as Unlimited Power and Awaken the Giant Within.

I have had the pleasure of attending two of his marathon weekend seminars together with 10,000 other delegates. It is quite an experience to witness so many people being reduced to single-minded power-houses for the briefest of moments.

It is now clear to me that every one of us truly have the seeds of greatness within us, and it is an incredibly intoxicating feeling to be reminded of how great you really have the potential to be. I don’t wish to trivialise Tony Robbins contribution to the self-improvement movement, BUT he is simply tapping into a latent trait we all possess: greatness in our chosen endeavour. He is reminding us of our true potential and he is taking credit for it through the process of association.

I am being unfair to Mr Robbins, because he is doing his best to give us the tools to achieve the greatness. However, I wonder how many of the 10,000 cheering hot-coal walking bombs of inspired energy actually achieved what they decided to over that weekend. I suspect we are talking a fraction of them. I guess that of the 10,000 people in that seminar, only a handful of them did what they planned to do.

Why is that? I go back to my fasting and raw food experience. It was hard work. I had to compromise. I had to dig deep and I had to put up with discomfort, a lot of it, and I had to remind myself constantly that this euphoria I had experienced when I conceived the idea of a 30 day fast, well that was my mind celebrating – appeasing me – giving me a reward and then saying “go back to where you were – we don’t like change, do we – it is hard work to change – it means pain and I don’t like pain“.

And this is where 99.99% fall by the wayside. The sad part is that they don’t really feel they failed either. For them (and I include myself in many of the goals that I set but never achieved) it was enough to set the goal, to imagine the outcome, to receive the chemical boost the body created in response to brain’s imagination, and to enjoy this momentary joy.

The chemical boost of imagining the outcome, to say the outcome out loud is essentially all the motivational speakers are facilitating to create success for themselves. Very few of them actually help people, not for the lack of trying, but because of who we human beings are.

Our energy flow along the path of least resistance, and this path is generally a path which requires only a modicum of effort, just enough to give us the feeling of achievement, but never taken us to the full potential. Again, it is the imagination of the success which gives us the greater thrill than the actual realisation of the success.

I decided to put my body to another test; something I knew would boost my productivity and my energy exponentially. I decided to get up every morning at 04:50am, and immediately go to the gym.

I knew what would happen. My mind would flood my body with “feel good hormones”, and I would feel like a million dollars, just from thinking that ludicrous thought of getting up in the middle of the night to go to the gym. That is the role of my mind: to make me feel good.

I also KNEW that my mind would say NO THANK YOU the very first time I set the alarm clock to 04:50am. And it did. It was so predictable. So when I rolled out of bed for the first time, I gave my thought patterns ZERO attention. I knew it would talk me out of it, if I listened. I was prepared to
combat myself and my mind.

What is the conclusion: be aware that your plans for a better future will create a sensation in your body which in itself can be addicting, and to most people is enough. Be aware that the moment you begin changing yourself, you will meet resistance, and it will be painful. If you know this in advance, you can prepare for it.

I knew day 3 would be painful during my fast, so I prepared for it, and I was ready when it arrived. I knew my mind would say no, when I first woke up at 5am, so I was ready for it. I knew not to read too much into the brain euphoria I received when I made the goal of going to the gym.

And trading? I knew my mind would congratulate me and flood my body with feel-good hormones when I decided to follow my trading plan, and let my winners run and cut my losses short. Of course it would do that.

And I knew it would kick up a sh** storm the first time I wanted to do it in a real trading situation. I was prepared for it.

It seems to me that our mind is not always our friend. It occurs to me that the mind is the coding facility, the place where we install the habitual software, the habits that leads to consistency, which leads to confidence in ourselves, which leads to success, but once it has done the programming, we have to turn it over to the body, and execute. From then onwards, it is now our job to IGNORE our minds and let the body do what we set out to do.

It is a complex balance of body mind dynamics, where we have to almost become an observer of ourselves and our thoughts and action. One moment the mind is your friend, and the next moment it is the enemy, standing in the way of you achieving your goal.

Thank you for reading

Tom Hougaard