They say that the market is driven by two things: greed and fear. Keep those emotions in check and you are halfway up the road to being a winner. Now try putting that philosophy into practice - it is easier said than done.
At the moment, I'm anything but a winner. I shamefully have to admit that my greed got the better of me this week. I seem to be down by €1,000 (Dh5,290) every other day. Fortunately, I'm still making simulated trades at this point and not risking real money.
The plus side is that at the end of this painful exercise I seem to finally have a trading plan that will work for me. I can safely say that my "trading mojo" is back.
The trend for German government bonds, or bunds, has been generally upward because of disturbing news on Greece, other European countries and unsatisfactory economic data from the US. However, intraday trades have seen bund prices oscillate violently and I have been caught in the noise.
By the fourth day of negative trades I decided I was thoroughly fed up with being a confused trader and vowed to sit by my simulated screen until I got my trading plan right. In the process I realised I was subconsciously trying to play the role of an analyst but without the grounded skills and qualifications.
I was trying to form an opinion or guess where the market would go and then base my trades on that analysis. I found I was also trying to rely on my beliefs of where I wanted the market to go instead of trusting my technical analysis - another term for reading charts to look for trends in the markets.
Of course, four consecutive days of negative trades proved that my assumptions plainly were not working. I realised then that trading, regardless of whether you are trading equities, forex or bonds, is to a large extent a psychological game. I needed to get to the crux of who I was.
Question: Who am I?
Answer: I am average Joe trying to make a solid euro. I am not a tarot reader, I cannot predict the future, I am not an oracle from Omaha like Warren Buffett nor am I a professional market analyst.
The words of a successful American trader came to my mind. This woman, a nurse turned independent trader, had told me that one of the first questions people tended to ask her was where she thought the market would be headed.
She always told them the same thing: "I don't know where the market is going and I don't care.".
She makes money by riding momentum in the market, not anticipating changes of direction.
I learnt that day, staring at the red box indicating the size of my losses, to accept my limitations.
I can't outguess the market. I am a trader. My job is not to try and project where the market will go. My job was to simply catch a trend and execute trades regardless of whether the market was going up or down.
As long as I obeyed my rules I would win on trades. The second I disobeyed my rules and formed an opinion or traded on hope, I lost.
My plan and strategy is now to keep it simple and un-opinionated. I'm down for now but most certainly not out.
Renee Tauro is chronicling her quest to become a successful trader
business@thenational.ae
Key figures in the life of the fort
Sheikh Dhiyab bin Isa (ruled 1761-1793) Built Qasr Al Hosn as a watchtower to guard over the only freshwater well on Abu Dhabi island.
Sheikh Shakhbut bin Dhiyab (ruled 1793-1816) Expanded the tower into a small fort and transferred his ruling place of residence from Liwa Oasis to the fort on the island.
Sheikh Tahnoon bin Shakhbut (ruled 1818-1833) Expanded Qasr Al Hosn further as Abu Dhabi grew from a small village of palm huts to a town of more than 5,000 inhabitants.
Sheikh Khalifa bin Shakhbut (ruled 1833-1845) Repaired and fortified the fort.
Sheikh Saeed bin Tahnoon (ruled 1845-1855) Turned Qasr Al Hosn into a strong two-storied structure.
Sheikh Zayed bin Khalifa (ruled 1855-1909) Expanded Qasr Al Hosn further to reflect the emirate's increasing prominence.
Sheikh Shakhbut bin Sultan (ruled 1928-1966) Renovated and enlarged Qasr Al Hosn, adding a decorative arch and two new villas.
Sheikh Zayed bin Sultan (ruled 1966-2004) Moved the royal residence to Al Manhal palace and kept his diwan at Qasr Al Hosn.
Sources: Jayanti Maitra, www.adach.ae
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Starring: Yasmine Al Massri, Clara Khoury, Kamel El Basha, Ashraf Barhoum
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COMPANY PROFILE
Name: HyperSpace
Started: 2020
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Based: Dubai, UAE
Sector: Entertainment
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Install an air filter in your home.
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Uefa Champioons League semi-final:
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The specs
Engine: 2-litre or 3-litre 4Motion all-wheel-drive Power: 250Nm (2-litre); 340 (3-litre) Torque: 450Nm Transmission: 8-speed automatic Starting price: From Dh212,000 On sale: Now
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