Take Action

November 2, 2008 | By Raymond Tan In Millionaire Thoughts |

When you wish upon a star, what do you wish for? If you’re like most people, financial freedom is one of the first things on your list. If you had a million dollars, think of what you could do. You wouldn’t have to ever work again. You could just sit on the beach and relax. But if you’re like most traders, you couldn’t stay away from the game even if you had infinite wealth. What else could you wish for? A crystal ball, perhaps. Or tomorrow’s newspaper so that you would be able to know what the masses were going to do tomorrow. You could anticipate their every move with unfailing accuracy. Think how easy trading would be? Wouldn’t it be nice to be able to predict the future?

It’s fun to wish that we could trade more profitably, but wishing can often be a sign of desperation. When you are in wishing mode, you passively wait instead of taking decisive action. You hope for miracles and wonder if you’ll ever see huge profits. But if you take proactive steps, you won’t have to wonder. If you set your mind to it and work hard enough, you will be successful. Through hard work and determination, you can make your wish of becoming a winning trader come true.

Can you predict what the masses will do? Not always, but seasoned traders rely on their wealth of trading experience. More times than not, they can accurately anticipate what the masses will do. When a company fails to meet earnings estimates, the price usually goes down. When the sell off is too great, many of the masses feel regret and buy back what they had sold. Do the patterns work like clockwork? No. Do they work a lot of the time under particular conditions? Yes.

What seasoned traders know, and so should you, is how specific stocks move according to world events, media reports, times of day, or whatever unique factors impact the price. Nothing is certain, but the more knowledge you have about a company, the better you’ll be able to anticipate how its stock price will move. And if you can stay ahead of the masses, you can profit. You don’t need to hope for a miracle. All you have to do is study the markets and develop an intuitive feel for how they move. Once you develop these skills, you could anticipate the markets almost as well as having a crystal ball

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