There are three kinds of people in the world: those who have heard about discipline but don't want to do the work of getting any for themselves (Gee, it would be awesome to have a black belt, but I have to work, train and become a changed person! Shocking! I know a store where I can buy one and then I can just wear it around and be a black belt without any of those fools being any the wiser!); those who understand the need and want to learn (these people are not reading Internet message boards; they are in the library studying, kicking the tires on systems (They may not make black belt, but they are at green - where they are ready to begin risking themselves - to learn about themselves when they get hit.); and those who can transcend the need for discipline because they have the instincts of a wild animal (These will seem to arrive at black belt without effort, but going from 2nd dan to 3rd will be hard for them because somewhere they will suffer a bad beating at the hands of someone with both good instincts and good discipline: to survive long term, they will have to go back and learn discipline.) That said, the elements of a successful trading system are no secret: 0. Learn about money management. Position size. Risk management. 1. Understand and select something from the momentum complex; reversion to the mean, MACD, stochastic, any other way you want to massage the available data points and so on. Lots of books out there: go to school. 2. Understand and select something from the sentiment complex; free yourself from "the news" - it is irrelevant except as a guide to the music of the market, options premiums, volatility bullish consensus, magazine covers, content analysis applied to market rhetoric and so on. Learn about things, for example, like "the oceans of liquidity argument" in all its forms, and listen for variants at market tops (people in India {or 'over there,' somewhere] gonna be buyn' gold is a common variation in the gold market), and the opposite at market bottoms. 3. Understand and select something from the volume complex; markets move either by bringing in more people with hope or more money, or by scaring more people away or draining away money: there are ways to measure both. Open interest. COT trends. Read people like Wycoff, for example, so you don't fear large traders (or the PPT or Central Banks) but make large traders your friend. 4. Know what a chart is and the theories about what they can tell you: ordinary TA, Elliott, candlesticks. Chart patterns may not tell you simply what is going to happen ahead (i.e., a pattern that seems to be repeating will probably start to diverge about the time you bet money on it.) but if you do not know the price history of the item you are trading, you may as well mail your money to some useless cause. This helps often to put other things in context: e.g. when a market goes down big during the day but closes up on the day, take notice, that's music, that's a bell ringing. 5. Learn about the "fundamentals" of the object you are buying and selling. Keep in mind the further you are from "the firm" and actual cash flow statements, the less useful fundamentals are. Indeed, in large liquid markets, fundamentals are spun by so many people that what everyone in the world knows is a good fundamental, is actually bearish and vice versa. Time value of money also is a fundamental fact. 6. Know what to do when you are wrong. Know what to do when you are right. And do it, don't suck your thumb. Used by permission of the original writer - from an internet board in July 2006. ===================================================================================== by bart: As you're probably aware too, I'm both loathe and paranoid of giving advice - trading or otherwise - other than urging anyone to define their own approach in their own way. I've thought a number of times of starting a trading thread but given folk like Vangel and others aren't exactly fans of trading, I'm afraid it wouldn't go very far before degrading into crap. There's also liability and responsibility issues that bother me - let's say I got sick or had something similar like computer problems and couldn't update the thread, and folk took big losses - not fun at the very least. That said though, the rough trading guides and TA tools etc. that I actually do use are on my Investing Hat page, and the most important single one is trend lines. I'd also *strongly* urge you to get Jim Sinclair's DVDs - he does a very good job of showing how to use trend lines and "play momentum". His "rhino horn" and "fishing line" views are also valuable. I also encourage you to read or at least scan Livermore's books - lots of good data there. You can download them from my quotes page. Another key that is seldom mentioned is what time frame you want to trade, since that will be the major factor in the resolution of the charts to watch. Day traders use 1 and 5 minute charts for example but I only use them when entering and exiting trades. You seem to have a good concept of risk too - very wise not going into leverage until you have winning experience and good confidence. And starting out slowly and on a gradient (sort of "baby steps") is also highly recommended - the whole idea being to learn and build confidence. It isn't jazzy or trendy... but it works. Having a plan *before* you enter a trade is where most make mistakes - they don't have solid stops and don't look if some underlying factor on which they entered has changed, etc. Risk wise, I won't even enter a trade unless I see in a best guess mode that my chances are 5:1 for winning. In other words and just as an example, silver is trading around $16 now and the next major target is around $21... which means I wouldn't have a stop lower than $15 ($5 gain to $1 loss). I wouldn't at all recommend starting with silver too - its one of the most treacherous and dangerous markets going for active trading. Setting stops is more of an art than science too, and other than using trend reversals to get out (a stop of sorts), its more experience based than anything. Even if I spent a lot of time telling you exactly how I set them (and I'm not sure I could even do that - too many factors), it very likely wouldn't work for you since we're different folk with different values, risk tolerance, world views, etc. One trader who also might help besides Sinclair is Ira Epstein - he owns a futures brokerage in Chicago and does two videos every day: search for the group IraEpsteinFutures on youtube - the master site is iepstein.com. Hope this helps... and the honest and real key is finding an approach that works for you. ========================================================================================