Well, it appears I rather released a largish cat among the pigeons last weekend!
Quite a few messages arrived during the week, making sure I realised YOU were not among the 'guilty' ones!
Anyway, last weekend's 'taking to task' seems to have had a fairly beneficial effect overall, so I'm very pleased my grumpiness has had a largely positive result.

As a consequence of some of your emails, I think it could be useful to continue this weekend, to examine 'reasons for failure' in some detail.

Last weekend, you'll recall that I mentioned 'fear' as being a major cause of difficulty among beginning traders - and indeed a major reason for extremely poor performance among many experienced ones too. Many of your messages during the week asked me to expand on 'fear' and how to overcome it.
Now believe me when I say I am no psychologist, so I won't be at all upset if you reckon my next few paragraphs are total cr*p, but here you go anyway, since you asked me!

One of the aspects of 'fear' that I forgot to discuss last time, is 'fear of being wrong'. That's what can prevent your taking a trade in the first place, and it affects men far more so than women.
Why so? - I think it's because a lot of men take far too macho an approach, and see themselves as being in some kind of competition with the markets.
Believe me, guys - that's a competition you are guaranteed to lose!
Think back to what I said in the manual: how is it possible to be wrong, if you execute a 'perfect trade'? If you understand your methodology, and are 100% happy with it, how can you be wrong, even if the trade you have entered, turns out to be a losing one?
If you recall, (and if you don't, I strongly recommend you revisit the manual!) I expect fully half of the trades I enter, to lose me money.
Does that make me 'wrong'? - Of course it doesn't!
But if you take an adversarial approach to trading, the fear of 'getting it wrong' will dominate your thinking.
The result? - either you'll never start at all, or you'll get cold feet after a loser or two, or (and this is a pernicious one because you can really fool yourself into the belief you are a successful trader) you'll keep taking profits as soon as you see a few points' worth in your favour.
"I win 80% of my trades" is a cocky statement I hear from time to time.
Well, listen up guys, if that applies to you: I guarantee that if I wanted to, I too could win 80% of my trades. No problem at all.
However, to achieve that impressive statistic, would involve grabbing profits as soon as they became available, and guess what? - the losing 20%, over time, would remove you from the trading arena. I'm not going to bother with the arithmetic, nor explain the statistics, because it's frankly too boring for words. If you don't believe me, well, you can find out for yourself over time!
By accepting that you will 'trade perfectly' and manage your open positions properly, you will see many trades become profitable that eventually stop you out for a loss. And that, of course, can be more than a tad frustrating - even someone as hard - bitten as I am, can accept that!
Equally however, you will see some trades ( admittedly a lot fewer) just run and run in your favour until the inevitable stopout leaves you with 100, 200 or even more points than that, of clear profit.

And believe me, to allow a trade to run like that, needs you totally to overcome your fears, whatever they might be.

Yet another aspect of human nature, that manifests itself as 'fear' (in my view) is 'lack of belief', or maybe 'lack of self belief' - both are probably the case.
What I mean (and I have several times touched on this in WICS, and in the manual) is that if you don't have total confidence in your methodology, you will never come to trust it fully.
Then, a few losing trades will cause you to say to yourself 'This fellow Williams doesn't know what he's talking about' and either you'll just give up, or you'll hopefully make a start on finding your OWN way in the markets.

It's a rather difficult thing to explain, so forgive me if this is another Ronnie Corbett job, but what I'm getting at is this: if you have a few losing trades using the TTEW methodology, but you can see they were in fact 'perfect' trades as defined by TTEW, then there is more than a chance that you will begin to question the overall validity of TTEW.

Now, if you do that from the point of view of objectivity, you'll very likely succeed as a trader, whereas if you do it from the point of view of handing ownership of these losing trades, back to me, you'll probably fail.
The former standpoint (objectivity) will allow you to question both yourself and me, and will add to the sum of your trading knowledge. (It's true to suggest that I can much better explain this 'live', which is why some workshop attendees have spoken about their 'AHA!' moments - always a pleasure to witness!)

My father always used to suggest that 'The eyes of a fool are in the ends of the Earth' - an adaptation I suspect of the 'grass always being greener etc'.
In the trading environment, this attitude usually means that those who suffer from it are always seeking the next 'method/system/whatever' - always buying something that they just KNOW will be the Holy Grail - then moving on to the next thing when they get the inevitable disappointment.
Why is disappointment 'inevitable'? Is it because every trading course is rubbish? I know I'm biased, but I don't think so - no, disappointment comes because such people won't do any work themselves - they're like baby birds with their beaks wide open, waiting to be fed. The concept of being totally responsible for their own success or failure, as yet eludes them.
TTEW is absolutely no different in that regard - it's not, nor has ever claimed to be, any kind of Holy Grail, and the 'constant seekers' are lacking two things - first, they lack the ability to take personal responsibility for anything, and second, they have missed what is staring them in the face. (And no, I'm not saying what that might be, because I am utterly certain that it will be obvious to many of you, and will hopefully become so for the rest, but you have to arrive there for yourself I'm afraid. A clue, though: have I ever mentioned 'Do Your Own Research'?)

Anyway, once fear is overcome, better traders emerge. No doubt about it.

Fear of losing money, by the way, is more than understandable. That's why I'm a great believer in the use of Finspreads Trading Academy when you are starting on this journey - how much can you really lose at 1p per point?

Two final things about 'fear' before I move on: first, of course a degree of fear is a good thing - it protects us from danger in all sorts of ways - but you need to differentiate between that kind of 'healthy' fear - 'respect' might be a better term - and 'rabbit in headlights' type fear which is demoralising in the extreme.

The second final thing to consider about fear, is to ask yourself "How superstitious am I?" Do you have a thing about Friday 13th? Or do you believe you'll be in for a bad day at the office if three sets of traffic lights turn red as you approach them during the commute to work?
When I used to have a fair bit of land, I ran a series of Land Rovers over the years on the farm and (naturally!) these were always green.
They gave a lot of trouble, frequently breaking down, and my mother was quite adamant that the reason was because 'green cars are unlucky'.
Do YOU believe that? If so, it's my firm view that you suffer from fear, in the sense of lack of self belief, and if you take that with you into the trading arena, you will fail.
MY belief is pretty simple - Land Rovers were, and still are, a badly put together heap of junk, but at the time, I felt a need to try to support the local dealer, with whom I had gone to school.

In short, dump your superstitions, because to have them, clearly says that you have a fear of taking full responsibility for your own actions. If you have that kind of problem, you'll never be able to take rational, objective trading decisions.

Last week I mentioned the Mark Douglas book 'The Disciplined Trader'. You'll pretty much find I'm (mis)quoting him in the foregoing, and I commend the book to you.

Anyway, that's enough 'get yer head straight' stuff, which as I recall, I promised I would never get into. I lied.

Moving on, not a lot to say about the 'Big Picture' without repeating myself week after week - in my view it hasn't changed, with the unwary still being sucked in as the intelligent sell at high prices - manifestly the case in the mobile telephony sector at the moment, if you have been following the markets.

A headline in today's FT: 'Bulls Raise Indices Despite Bad News' - that rather answers another question received last week, concerning whether current overall market sentiment (ie highly bullish) means there are no shares to consider selling. The article goes on, among other items, to highlight the Travis Perkins profits warning, and the fact that MFI is struggling badly enough to be pretty close to bankruptcy.
Trust the charts - they will warn us that the bulls might end their run soon enough. (or indeed they might suggest there is still a lot of upside to come!)
Time will tell, as always, but I haven't altered my overall thinking, I assure you.

Moving on to today's first chart (yes, my laptop has been restored to life by some miraculous process!) I'm looking at BAA, to share the reply I gave to one of you during the week - the question was concerning the significance or otherwise of Directors' Dealings, as related to the current 'look' of the chart.
My correspondent felt that a potential 'buy' order might be of interest, but he wondered what I thought about the fact that recently, around £1m of share options had been bought, then almost immediately sold, by a couple of BAA directors.
(Share options, by the way, are 'exercised' by the director buying them at the price stated on the option certificate, so if you had an option on BAA shares at say 620p each and today they are trading at say 650p, you could exercise your option to buy at 620 and immediately sell at 650 for a wee profit.

Usually, however, much bigger profits are sought, with directors who really believe in their company, holding on for a long time - maybe cashing out a percentage after the price has doubled, and so on.)

Anyway, my correspondent was fairly happy with his analysis of the chart, that there might be a valid 'buy' just above the February 05 high (I'm not saying 'yes', nor 'no', to that, by the way.)

However, he wondered about the options exercise and sale and whether that might be a bit of a 'negative'.

My answer was to suggest he ask himself a question or two, as per last weekend's WICS - perhaps by putting himself in the shoes of one of the directors - something like this: "I wonder....should I exercise my option to buy these shares? or should I just wait and see? After all, even if they double, I can still buy them at the option price. On the other hand, what if they drop in price and keep on dropping? No point in exercising an option that costs more than the market price....Oh, I don't know - maybe I should just grab what I can get now, because I really have no confidence at all in the long term prospects of my company."

Not that I'm suggesting anything adverse about BAA, mind, and in any case, few directors have the slightest idea about what is actually going on, but maybe I would pause a little if I had thoughts about buying BAA shares meantime.
(And yes, Ian J. - I know the above is a longer answer than I actually gave you in my reply to your question!)

Talking about 'directors being clueless' reminds me of my little rant for today - it concerns the dropping by the FSA (Financial Services Authority) of the fraud case against the ex - chairman of Shell, who had grossly mis - stated his firm's oil reserves. Sorry, Sir Philip - of course I meant 'allegedly mis - stated.' Strangely (and of course entirely coincidentally, the guy at the FSA who had been in charge of the investigation, and who had moved heaven and earth to make the case in the first place, has just been offered, and has accepted, a much better paid job with the firm that was advising Shell's ex - chairman.) Is it just my dodgy septic tank I can smell this afternoon?

Moving rapidly on, the next chart (Babcock) was last featured in WICS of 28th August, and for sure, it would be hard to see a better example of the need for patience - have a look at it today, in the context of revisiting 28th August WICS too.

Then we have two charts that featured in WICS of 9th October: Cadbury Schweppes and HMV. Both are suitably annotated, and of course it would be a good idea to look back to WICS of 9th October 05 too, for a fuller picture.

Finally today, I would just like to remind you that next weekend there will be no edition of WICS, because I'll be running my final workshop near Birmingham on the 19th November.

There will be no email answering from Thursday evening (17th November) till Monday morning (21st), so please 'hold' your questions during that period.

I believe there might still be a place available on the workshop - my publishers won't update me till Monday - but I reiterate, this WILL be my very last one, and my name's not Frank Sinatra!
I'm looking forward a great deal to meeting those of you who are attending, so to you, "see you on Saturday", and to the rest of you, "see you in WICS, in two weeks' time". (27th November.)

With all best wishes as always,
Ian.

.'IMPORTANT NOTICE: These WICS charts are for EDUCATIONAL PURPOSES ONLY. They represent only MY understanding of what is happening in the market for any particular share, stock, commodity or index. In NO circumstances should they be construed as recommendations to trade. If I choose to trade what I see, that is MY decision. YOU must, in turn, come to YOUR OWN conclusions about what action, if any, YOU might choose to take'.