Jesse Livermore Quotes

Averaging Buys/Sells: “When I’m bearish and I sell a stock, each sale must be at a lower level than the previous sale. When I am buying, the reverse is true. I must buy on a rising scale. I don’t buy long stocks on a scale down, I buy on a scale up.”
Discipline: “The market does not beat them. They beat themselves, because though they have brains they cannot sit tight.”
Price Action: “The price pattern reminds you that every movement of importance is but a repetition of similar price movements, that just as soon as you can familiarize yourself with the actions of the past, you will be able to anticipate and act correctly and profitably upon forthcoming movements.”
Stock Picks/Following People: “The average man doesn’t wish to be told that it is a bull or a bear market. What he desires is to be told specifically which particular stock to buy or sell. He wants to get something for nothing. He does not wish to work. He doesn’t even wish to have to think.”
Cutting Losses: “A loss never bothers me after I take it. I forget it overnight. But being wrong – not taking the loss – that is what does damage to the pocketbook and to the soul.”
Timing: “It isn’t as important to buy as cheap as possible as it is to buy at the right time.”
Being Right: “There is only one side of the market and it is not the bull side or the bear side, but the right side.”
Stocks Not Acting Right: “If a stock doesn’t act right don’t touch it; because, being unable to tell precisely what is wrong, you cannot tell which way it is going. No diagnosis, no prognosis. No prognosis, no profit.”
Stock Tips: “I know from experience that nobody can give me a tip or series of tips that will make money for me than my own judgement.”
Not Taking It Personally: “Getting sore at the market doesn’t get you anywhere.”
Learning Curve: “It took me five years to learn to play the game intelligently enough to make big money when I was right.”
Self-Confidence: “A man must believe in himself and his judgement if he expects to make a living at this game.”
Hard Money: “People who look for easy money invariable pay for the privilege of proving conclusively that it cannot be found on this earth.”
Importance of a Plan: “My plan of trading was sound enough and won oftener that it lost. If I had stuck to it I’d have been right perhaps as often as seven out of ten times.”
Lesson Learned: “It takes a man a long time to learn all the lessons of all his mistakes.”
Waiting for Opportunities: “After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was my thinking that made the big money for me. It always was my sitting.”
Intuition: “I knew something was wrong somewhere, but I couldn’t spot it exactly. But if something was coming and I didn’t know where from, I couldn’t be on my guard against it. That being the case I’d better be out of the market.”
More on Sitting: “The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street even among the professionals, who feel that they must take home some money every day, as though they were working for regular wages.”
Daily Personal Struggle: “A stock operator has to fight a lot of expensive enemies within himself.”
Pain is Good: “If I hadn’t made money some of the time I might have acquired market wisdom quicker.”
Blowing Up: “There is nothing like losing all you have in the world for teaching you what not to do. And when you know what not to do in order not to lose money, you begin to learn what to do in order to win. Did you get that? You begin to learn!”
Physically and Mentally Fit: “I couldn’t afford anything that kept me from feeling physically and mentally fit. Even now I am usually in bed by ten. As a young man I never kept late hours, because I could not do business properly on insufficient sleep.”
Accept Responsibility: “The customers, who were all eager to be shoved and forced into doing things so as to lay the blame for failure on others…”
Greed: “One of the most helpful things that anybody can learn is to give up trying to catch the last eighth – or the first. These two are the most expensive eighths in the world. They have cost stock traders, in the aggregate, enough millions of dollars to build a concrete highway across the continent.”
Taking Breaks: “I can always give up trading to play, unless of course it is an exceptionally active market in which my commitments are rather heavy.”

Trading Psychology

How To Kill Your Trading Career In 4 Easy Steps

From http://www.attitrade.com/

Trading is like any other skills based activity in that it takes time and practice to become proficient. There are no short-cuts, at least none that lead to longevity in the markets. Ask anyone who trades for a living and they’ll tell you about long hours spent poring over data, charts, earnings reports, etc. Those charging you thousands for their “market secrets” would tell you otherwise.
The rewards of making a living from the markets are numerous and well worth the effort. If you treat trading like a career rather than a job or an ATM then your natural desire would be to work at it at least 40 hours a week.  I’ve had many 12 hour days in my trading career, even a few that lasted 16 hours because I was hedging a position with futures. I wouldn’t trade those long hours for anything as that sweat equity has paid big dividends over the years.
However, if hard work, self-discipline, and learning isn’t your idea of fun then I’d suggest following these four steps below to help you exit the trading world as fast as possible.
1. Trade mismatch

Probably the most common way to blow up an account and end your trading career is to participate in the wrong market and/or employ the wrong strategy. Many walk away each year from the markets jaded and penniless because they tried to trade a strategy/system that works for someone else without giving a thought to whether or not they had the psychological makeup to produce a profit over a sustainable period. I’m referring to matching a trading style with your personality.

You wouldn’t go into a store and grab the first pair of pants you see because they look good on someone else would you? No! You’d shop around, try a few pairs on and make an informed decision about which pants work best for you. Trading should be no different. Don’t make it more difficult that it has to be.

2. Limit resources

With today’s technology and the vast availability of free information out there it’s impossible not to take advantage of it like a $4.95 all-you-can-eat buffet. Seriously though, trading takes time and money so proceed knowing that you will not make a fortune in your first few weeks, despite what others may have told you. In fact, it may take a year or more to master a setup or strategy and turn a profit.

Spending most of your capital on “education,” leaving a small amount to trade with, will no doubt crush your dreams of being a successful market participant. You need to be well funded in order to survive the learning curve that is the market. There is no way around this.

3. Go it alone

Bottom line is that without a good mentor, or even more than one, you will die a lonely and poor trader. There are great resources out there, many of which are free, that can provide education and an opportunity to meet others and perhaps create a lasting relationship that could lead to many mentoring opportunities. StockTwits is a great example of free resources out there with people ready to lend their knowledge about trading. Other examples include local universities, trading organizations, and virtual education centers.

The point is that you wouldn’t start any job, let alone one you wanted to make a career, by jumping in head first. Sniff around a bit, visit your local library and check out some books (Google books works as well) and do some legwork. Find the email addresses, phone numbers, twitter handles, etc. of people that seem to know what they are doing and hit them up for advice. You’d be surprised how willing most people are to share their knowledge.

4. Be overly self-critical

It’s real easy to pick out and focus on the negative aspects in life. Trading is no different. I’m not suggesting you trade with rose colored lenses but rather focus on the positive things you do. The negative mindset is a cancer and will overcome the positive aspects of your trading if you let it. I have yet to meet a trader that hasn’t made numerous mistakes. It’s those traders that learn from their mistakes while focusing on positive outcomes that find longevity in the markets.

It’s easy to lose in the markets and walk away with a negative attitude about how it’s a rigged game. After all, you’re just one of the little guys that can’t be expected to compete with the Goldman Sachs of the world. Don’t be a statistic, man up and be a legend.

1st Day Back

Back from my leave of absence.  Needed to re-evaluate my trading plan, strategies, and my psychology.  I started the year off very well, gave it all back, and started digging a hole.  My position sizing was a major issue leading to big losses. I was getting frustrated because I was focusing too much on $$$ and not enough on trading.  Proper position size allows me to keep my risk in check and allows the trade to work.  If I manage my risk, play the right setups, profits will come.  

HNSN