Paralysis by Analysis
Every few months here in SteadyTrade land, hosts Tim Bohen and Stephen Johnson present a listener mailbag episode where they review some of the many inquiries we receive. This week we’ll talk about : Paralysis by Analysis
It’s a chance for our hosts to address specific listener questions and help you gain a better understanding of the trading world.
But here’s why they really do it … As a seasoned veteran, Tim can sometimes overlook some introductory stuff, and Stephen is admittedly drunk half the time. These episodes are an opportunity to slow down and explain some of the finer points of trading!
Today’s episode is action-packed, featuring some of your inquiries. In this episode, our hosts cover how to get real about trading, how to overcome FOMO, and what support and resistance are and how to use them.
Don’t forget: if your question is asked on air, you could win a basket of SteadyTrade goodies!
But first … where has Stephen been?
In the past few episodes, Tim and Stephen reference Stephen’s “spiritual awakening” in Thailand. In this episode, he’ll dish the deets. Don’t miss this one on YouTube, especially if you want to see Stephen’s sweet new Thai tattoos …
Let’s get to those questions. Here are some highlights:
Liam: I’m about to open my first brokerage account. I know it’s a journey, and I know I’ll make mistakes, but I’m kinda scared to get started. Any tips on how to be more aggressive in my progress?
As Tim and Stephen see it, Liam may be suffering from “paralysis by analysis.” Of course you want to be prepared. But Stephen points out that the quickest way to fail is to not try at all.
Both Tim and Stephen have suggestions on how to conquer your fears and actually get started in trading. They also have tips on how to challenge yourself and face the many fears that can come with stock market trading.
Leslie: I’m looking for insight into how you choose support and resistance. Do you use the daily chart, or do you plot them from the intraday chart?
Tim talks about how he uses the daily chart for major support and resistance. But once you enter a trade, you can use the intraday chart to help support your decisions and monitor your position.
Remember, charts are an art — not a science. Find out which approaches Tim and Stephen take with support and resistance in trades. Want more info about support and resistance? Check out episode 84 to learn more, complete with charts.
Jake: I see a lot of traders using Level 2. Is it worth it? What is it, and how do I use it?
Level 2 is the order book for a stock, with a complete listing of the buyers and sellers. As Tim puts it, it’s like a digital representation of all the traders in the trading pit waving tickets like you see in the movies.
Level 2 is valuable, but it’s just one small piece of the puzzle. As Tim and Stephen explain,
you need to understand basic charting and have some trading prowess before you tackle Level 2.
Is it something that new traders should include in their toolbox? Listen in to hear what they have to say!
Alex: Can you talk about how to break away from the gambler’s mentality, how your account is your business model, and how to get serious about trading?
Stephen admits that battling the gambler’s mentality is hugely difficult — even seasoned traders struggle with it! But when you get down to it, can you cut your losses and understand that it’s an odds game?
Tim and Stephen also have some great tips for how to treat your account like the business it is and talk about how they’ve been able to get serious with their own accounts!
Raymundo: I want to hear about timing! Can you tell me about what time of day can be better for trading, including entries and exits?
Everyone can get FOMO with early- and late-day trades, so it may be smart to work up to those more volatile times as a new trader to overcome paralysis by analysis .
Tim makes a case for why, as a new trader, it might be smart to focus on midday trades. He also gets into the cautions of premarket trading and talks about stalking trades. There can be benefits to letting the market ‘digest’ catalysts and news.
Got questions of your own? If there’s ever something we bring up that’s not clear, leave a comment on YouTube, the blog, or email us.
Thanks for tuning in to the SteadyTrade Podcast. Stay tuned for weekly episodes featuring the hottest topics for aspiring traders!
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