How to Trade in the Zone
Find out if you’ll Make a Good Zone Trader.
- Are you afraid of change? Do you stick with the familiar even when presented with a better alternative?
- Are you one to operate in “auto pilot?” Do you make decisions from a neutral position? Assume you own no positions currently; which one would you trade now?
- Does decision-making leave you paralyzed? Are you more likely to do nothing when faced with too many choices?
- Do you cling to your preconceived opinions and feelings for dear life? Are you able to take an unbiased look at new information or do you tend to dismiss or ignore information that doesn’t fit your preconceived notions?
If you answered NO to the majority of these questions, you’re ready to Trade in the Zone.
Find Your Zone and Determine Your Strategy.
- Objectively identify your edge.
- Predefine the risk of every trade.
- Completely accept the risk or be willing to let go of the trade.
- Act on your edge without hesitation or reservation.
- Decide when to use price as an opportunity rather than a hindrance.
Eliminate the Emotional Risk By Following These Rules.
- Anything can happen.
- You do not need to know what is going to happen next in order to make money.
- There is a random distribution between wins and losses..
- An edge indicates a higher probability of one outcome happening over another.
Courtesy: Mark Douglas; Author of: TRADING IN THE ZONE; Published by: Prentice Hall, Jan. 2, 2001.
Trade With Confidence.
Less than 5% of our return will come from what the market does. The other 95% will come from what we do. It’s not the market, it’s us. Trade in the Zone’s main purpose is to help you focus on what to trade, and when to trade it…this is what determines your performance. It is essential to act without fear or hesitation. Think of how well you do when “paper trading.” This is because you are in a carefree state. That is the only way to execute an effective Trade In The Zone. Accept the predefined risk and trade in a more “carefree state” by using the Trade in the Zone report for names to trade, points of entry, and discipline on protective stops.