time window of understanding. All we need to know is when a commodity market turn is about to take place. Forget the time in-between when the market is trending, chopping and doing everything it can to give false signals.

If you can see clearly at the turning points, who cares what happens in-between? That’s where many of us get into tr

Novice commodity futures and option traders make the same mistakes year after year. There's a tremendous amount of money that changes hands as a result. Make it HARD for the market to get your money, not easy! These principles apply to stock trading as well.

Even experienced commodity futures contract and options traders need to keep reinforcing common sense rules. No one is immune to making basic errors from time to time. I know of several traders who continue to read the same books on trading psychology over and over...and they’re some of the best futures contract traders I know. We constantly need to remind ourselves of things we already know.

In the real world, it seems most of us learn after a good whack. After getting banged for a big loss, most futures traders start talking about what they did wrong and what they will do next time to correct the problem. Some go back to the computer to try new approaches and work hard. In contrast, after a big gain, trading habits sometimes get more lax and we set ourselves up for a big loss. We need to monitor ourselves all the time. The objective it to be consistent and level-headed most of the time.

One of the common novice mistakes is to think we can make money all the time. Or we think we must understand what is going on in the futures market most of the time. In reality, all we need is a narrow time window of understanding. All we need to know is when a commodity market turn is about to take place. Forget the time in-between when the market is trending, chopping and doing everything it can to give false signals.

If you can see clearly at the turning points, who cares what happens in-between? That’s where many of us get into tro

nforcing common sense rules. No one is immune to making basic errors from time to time. I know of several traders who continue to read the same books on trading psychology over and over...and they’re some of the best futures contract traders I know. We constantly need to remind ourselves of things we already know.

In the real world, it seems most of us learn after a good whack. After getting banged for a big loss, most futures traders start talking about what they did wrong and what they will do next time to correct the problem. Some go back to the computer to try new approaches and work hard. In contrast, after a big gain, trading habits sometimes get more lax and we set ourselves up for a big loss. We need to monitor ourselves all the time. The objective it to be consistent and level-headed most of the time.

One of the common novice mistakes is to think we can make money all the time. Or we think we must understand what is going on in the futures market most of the time. In reality, all we need is a narrow time window of understanding. All we need to know is when a commodity market turn is about to take place. Forget the time in-between when the market is trending, chopping and doing everything it can to give false signals.

If you can see clearly at the turning points, who cares what happens in-between? That’s where many of us get into tr

eems most of us learn after a good whack. After getting banged for a big loss, most futures traders start talking about what they did wrong and what they will do next time to correct the problem. Some go back to the computer to try new approaches and work hard. In contrast, after a big gain, trading habits sometimes get more lax and we set ourselves up for a big loss. We need to monitor ourselves all the time. The objective it to be consistent and level-headed most of the time.

One of the common novice mistakes is to think we can make money all the time. Or we think we must understand what is going on in the futures market most of the time. In reality, all we need is a narrow time window of understanding. All we need to know is when a commodity market turn is about to take place. Forget the time in-between when the market is trending, chopping and doing everything it can to give false signals.

If you can see clearly at the turning points, who cares what happens in-between? That’s where many of us get into tr

selves up for a big loss. We need to monitor ourselves all the time. The objective it to be consistent and level-headed most of the time.

One of the common novice mistakes is to think we can make money all the time. Or we think we must understand what is going on in the futures market most of the time. In reality, all we need is a narrow time window of understanding. All we need to know is when a commodity market turn is about to take place. Forget the time in-between when the market is trending, chopping and doing everything it can to give false signals.

If you can see clearly at the turning points, who cares what happens in-between? That’s where many of us get into tr

time window of understanding. All we need to know is when a commodity market turn is about to take place. Forget the time in-between when the market is trending, chopping and doing everything it can to give false signals.

If you can see clearly at the turning points, who cares what happens in-between? That’s where many of us get into trouble. It leads to bucking the trend, getting in too early, getting out too early and over-analyzing price action.

So how do we focus on the market turns? The way I focus on turning points is with a general alert I wrote for my commodity trading programs. Whenever there is a buying or selling panic, a computer beep goes off. This tells me to get into action and start looking for a price turn. After this signal, I may or may not see a trading set up to act on, but it keeps me from wasting time trying to analyze the middle of moves in progress. Panics often flag set ups yet to come. If I'm in a position, I always wait for a panic in my favor to exit.

Taking visual market snap-shots every so often is the way to watch the screen.. We must decide what time frame we are interested in trading and then make our own alert. This can be an automatic or manual alert. It may be one-minute bars for futures contract day trading or weekly bars for long-term positions. Pick your time frame and figure out what is a major bottom or top for your method.

My philosophy is that no move is worthwhile to pursue until a clean-out panic has taken place. This means for both buying and selling spikes. The bigger the potential up-move you expect, then the more double or triple bottom work needs to be done to support it. Everything must be in context when comparing a pote