Yesterday, one of the crypto space’s most prominent and successful traders Craig Cobb kicked off his four-part series teaching you all he’s learned about becoming a profitable trader. If you missed the first webinar, don’t despair, you can read a quick recap below. All the content from the series will also be made available at the end as well, although we strongly recommend that you attend the individual webinars live as you’ll gain exclusive access and opportunities to ask as many questions as you like – completely free of charge.
Craig begins the course with a brief background of himself and how he started trading on his own when he was 21. Without messing around, he admitted frankly that he completely sucked! “I was hopeless,” he said and he explained that it was because he thought he could do it all on his own. After all, there’s a wealth of free content available, and he self-taught, falling into what he calls the “cycle of doom,” constantly failing to make money consistently.
He says that the problem with most of the free content is that it’s provided either by people who don’t know how to trade or that it’s simply information overload. He says that trading should be simple–not easy–but not over-complicated by technical analysis and jargon that only serves to slow traders down.
When he found a mentor to teach him, he began to focus on trading strategies that actually work. He found that trading is all about structure and planning. You don’t need to know about everything about the market; you simply need to think like a trader, trade with rules, know the difference between a good and a bad trade, how to quickly determine an upward or downward trend, and identify real support and resistance.
Beyond keeping your trading strategy as simple as possible, the other key to success lies in controlling your emotions. “Emotions are your enemy, they can grill you and they can kill you.” The only way that you can make money is through using consistent strategies and setting rules, and know that if there isn’t a good trade, don’t trade.
Think in Terms of Probabilities
He goes on to describe the importance of thinking in terms of probabilities using the example of tossing a coin, which gives you a 50/50 chance of winning. He says that it is imperative to think in terms of reward/risk rather than win/loss. Why? Because just because you are positive in terms of trades doesn’t mean that you are positive in profit. Win-loss isn’t relevant unless you are also examining reward to risk.
For example, Craig says, he risks $1000 on 10 trades ($100 per trade). “Let’s say I lose six trades and I am negative 600, then I have two break-even trades, and two trades left. I’ve lost more trades that I won but my remaining two trades bring in high return. One trade is 5% return and one is 6%. So in total, I am up 11%, down 6% which means I am up 5% overall. Trading is a lot more than a win-loss ratio.”
He then says asks the question, going back to the coin, of how we can change the odds in our favor so it’s not always 50/50? He says that we can change the amount that we win or lose when the coin lands on heads or tails.
So, if you won $50 each time you landed on heads, and you lost $10 each time you landed on tails, he asked if you had traded eight times and landed on tails, were down $80 with two trades left… would you trade again? The answer would be yes because you still have a chance of making $100 from two more flips and thereby erasing your losses. “When you know you have an edge, you have to keep on keeping on,” he says.
Control Your Emotions and Stay in the Zone
Craig highlights the importance of concentrating on the now to stay in the zone, like mindfulness, keep all other emotions outside of it. He advises participants not to feel rushed when they’re trading, but to stop, think, breathe, and let go of the stress of the day first. The best traders are people who can be calm under pressure. FOMO, greed, and fear will take you out, don’t let the emotions get the better of you, “feelings are emotions and they don’t make you money.”
He also advises to keep good records of the trades you take and explains the importance of margin and leverage. He says that they must be understood and respected and warns that leverage can be a double-edged sword but also a tool that allows you to double your money when you know what you’re doing.
Learn the Right Words
Craig explains that there is a massive difference between TA and Trading Strategies. He maintains that you don’t need to know all of the TA that everyone talks about and says that he only uses three indicators because trading should be simple. You don’t need all that jargon like “overbought RSI,” “dead cross,” or “sloping trendlines.”
You need to focus on simple and outcome-based indicators only, such as who won on this single candle? Who’s in control – buyers, or sellers? “Follow the trend using these simple indicators, and forget all the rest,” he says.
He then asks participants to think about the type of trader they are or want to be, whether it’s a day trader or a swing trader and provides some advantages and disadvantages to both. Either way, he says, the same rule should apply: Only trade is there is a good trade, not just because you feel you have to.
Craig then tells participants that the most valuable tool that he can teach them is price action. Why? He says “because price is pure, it’s not subjective.” He then takes a look at candlesticks and explains them in a very simple way that allows traders to unclutter their minds by not overcomplicating things.
He also says that mastering price action is the most important thing you can do and then gives participants an interactive session teaching them how to identify uptrends and downtrends quickly. He says that if you cannot see a clear trend either up or down, then don’t trade. The trade is not there if it is not clear for you: “If it’s not clear, it’s not there,” he says.
After several exercises in identifying price trends, the class moves onto identifying real resistance, and real support. Again, he reminds participants to keep it simple and says you don’t need to learn names like “double top” and “double bottom.” Just know what you need to know and that’s that.
The next class with Craig will take place at the same time next week and continue to talk about mastering price action with further interactive examples. Don’t miss out on this invaluable series and join live to get the very best out of it. If you haven’t already, sign up for the webinar here and learn how to become a profitable trader for life.