Today's Quote: “For every failure, there's an alternative course of action. You just have to find it. When you come to a roadblock, take a detour.” Mary Kay Ash

There are several good books out there about trading that should be on every trader’s must read list. If you were forced to choose one and only one, the only possible pick would be “Tools and Tactics for the Master Day Trader”. We are going to run a series of excerpts from the best selling book for the next series of lessons. Now in the words of the master trader himself, Oliver L. Velez…

STARTING EACH DAY ANEW

Each day, I hear from market players who have been emotionally incapacitated by some recent loss or losses in general. And given the market's tendency to deliver frequent bouts of difficulty, I can only imagine that there are plenty of individuals reading this book today who need a bit of encouragement, in addition to a helping hand, which we're always willing to give. To these special souls I will say this: A trader's life should begin anew each and every day. If that supreme level of success, which is so difficult to obtain, is what you truly desire, you must develop the ability to forget about your past failures or, more precisely, to forget about the disappointment they caused, while retaining the valuable lessons they offer. It should be realized that every mistake you've made is really one less mistake you'll have to undergo in the future, as long as you've learned the lesson it was meant to teach. Taken this way, your losses actually become your power, your mistakes just another aspect of your future success. At times, I am quite surprised at how easily traders give up after a few losing trades. But after a little thought, the level of my surprise diminishes dramatically. Greatness, in any endeavor, lies within one's ability to persevere until all obstacles have been overcome. The "average" individual utterly lacks this determination, which is why superiority and greatness are such rarities. Today we outperform the markets year after year because yesterday we were failures, albeit smart failures who learned from our mistakes. Today we enjoy a level of market accuracy that others in our field can only dream of, because many years ago we realized that there's no shame in making mistakes, as long as you learn from them. In every loss, in every losing trade, lies a gem that needs to be discovered, a precious lesson that brings you one step closer to enrichment. Find them, and you will eventually reap big rewards.

There is only a limited number of ways in which a trader can lose. This statement clearly points to the fact that there are only a handful of mistakes possible. The challenge we all face as aspiring traders is not to avoid loss. Rather it is to get on with it so that we can learn from each one. If we can somehow experience every possible way to lose, and completely absorb the lessons contained within them, our wisdom and trading skill would catapult to a level very few ever reach. But it must be remembered that each loss, after a brief examination, must be left on the operating table. It is the lesson that we must take with us. The loss itself, which is only the caucus that contains the lesson, must forever be dropped from our minds. This will ensure that we start each day fresh and new, only we will be more than new. Armed with a new lesson learned and another one of those limited ways to lose defeated, each day will be a step up to higher and higher states of mastery.