Winning the Day Trading Game

 

Click on any of the chapter titles below to read and download that portion of Tom Busby’s best-selling book OR click on the play button to listen to the audio book version of that chapter.

 

Chapter 1: The Crucible: Black Monday (October 19, 1987)

      ● Being persistent and studying the game.
      ● Focusing on today and not worrying about yesterday.
      ● The importance of trading education.
      ● Risk management as your first priority and not risking money you cannot afford to lose.
    ● Learning from every trade, analyzing and critiquing yourself continuously, but always trading in the present.

 
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Chapter 2: Time is Central

      ● Why patience pays.
      ● Trading during the times of greatest liquidity and volatility.
      ● Using a 24-hour trading clock.
      ● Avoiding overtrading.
    ● Importance and use of the yearly opening price of the markets that you plan to trade.

 
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Chapter 3: Trading is a Numbers Game

      ● Using key numbers to get the big picture.
      ● Recording and remembering yearly opening prices.
      ● Using yearly, monthly, and weekly opening prices to form a trend line and determine whether the market has a long-term bias.
      ● Importance of learning and using certain numbers that hold significance in a particular market.
    ● Using key numbers to determine points of entry and exit and to establish profit targets.

 
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Chapter 4: Read the Tape

      ● Tape reading as an art not a science.
      ● Moving with the unique rhythm of the market.
      ● Reading an index or stock price in the context of the market rather than in isolation.
      ● Trusting indicators over your preconceived notions.
    ● Watching key numbers and time of day when reading the tape.

 
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Chapter 5: There’s No Crying in Trading

      ● Importance of preparation.
      ● Taking reasonable profits and avoiding greed.
      ● Taming fear and not letting it take your profits.
      ● Admitting when you’re wrong and exiting the trade.
    ● Avoiding wasting time and energy with regret, not demanding perfection of yourself, analyzing your mistakes, learning from them, and moving on.

 
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Chapter 6: Riding the Rail

      ● Having a proven strategy and knowing how you will approach the market.
      ● Executing your strategy skillfully.
      ● Risk Management, including knowing where you will take profits and place protective stops.
      ● Using a trading method that acknowledges both fear and greed and manages both.
    ● Dynamic nature of markets and adjusting your strategy when necessary.

 
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Chapter 7: Worry About Risk the Rewards Will Come

      ● Considering the risk of a trade first.
      ● Knowing and liking the risk of every trade before taking it.
      ● Determining your personal tilt number and not exceeding it.
      ● Managing every trade to limit risk and control losses.
    ● Making preservation of capital your primary goal.

 
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Chapter 8: Respect the News

      ● Preparing for breaking news events using protective stops.
      ● Checking each day, before trading, the releases of scheduled economic reports.
      ● Staying out of the market when scheduled news is breaking and letting the market settle down before risking your money.
    ● Avoiding trying to predict the news or its effect or being lured into a market that is responding to news.

 
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Chapter 9: Getting Down to Brass Tacks

      ● Importance of the S&P Futures Index and using it to help trade other securities.
      ● Importance of recording yearly opening prices of stocks, bonds, and commodities and using this information throughout the year.
      ● Continuously monitoring your mutual fund portfolio and adjusting your holdings quarterly as needed.
      ● Using a 65-day moving average to help you when trading gold futures.
    ● Doing your homework and studying a market before trading it. Knowing how it moves, identifying its key numbers, and locating support and resistance.

 
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Chapter 10: Preparation Pays

      ● Being prepared to trade and taking advantage of the opportunities presented.
      ● Studying the past but trading in the present.
      ● Recording a detailed trading diary each and every day.
      ● Holding yourself accountable for violating your rules or not exercising discipline and patting yourself on the back for following the rules.
    ● Visiting your diary often and reminding yourself of your strengths and limiting your weaknesses.

 
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Chapter 11: Study in Contrast

      ● Using the weekend to get informed about financial events.
      ● Studying charts of the past week’s trading and identifying key numbers that may be reached in the week ahead.
      ● Learning about upcoming scheduled news events.
      ● Visualizing the big picture of the market.
    ● Planning a weekly strategy and getting ready to take calculated aim.

 
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Chapter 12: Recap the Essentials

      ● Beginning with time of day.
      ● Integrating key numbers with time.
      ● Accurately reading the tape as essential for successful trading.
      ● Achieving and maintaining emotional balance for good trading.
      ● Establishing strategic objectives and being tactical.
      ● Trading as a business that requires good money management.
      ● Ability of news to destroy the perfect strategy.
      ● Importance of having the right equipment.
    ● Constantly preparing, evaluating, and improving as a trader.

 
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Chapter 13: An Afterthought for Consideration

    ● Why it’s better not to be a genius in order to be a good trader.

 
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Index
Appendix A (Glossary)

Appendix B (Getting Started)
Appendix C (Order Types)

Appendix D (Suggested Reading)
Appendix E (Helpful Websites)