1) On the first day of trading, Jim Dalton said to me, �Cultivate patience.

� All
too often traders are anxious, nervous that they�ll miss the best trade of the day.
When you have this anxiety you are too likely to make an impulsive trade. Take
advice from Santa: Be patient and wait for the goods.

Jim Dalton

2) On the second day of trading, Jim Dalton said to
dominating the market.� When smaller timeframes are
references are in play: The overnight high and low,
unchanged (prior pit session settle), and the prior
these references aren't in play, you�re more likely
timeframes dominating the session.
me, �Know what timeframe is
in control, your short-term
the opening, halfback,
session's high and low. When
experiencing the longer

Jim Dalton

3) On the third day of trading, Jim Dalton said to me, �Recognize that trade
location is the best risk tool at your disposal.� A trade that�s been positioned
close to a structural place for a stop offers attractive opportunities. Placing
trades that are supported by buying and selling tails is one example - A breakout
from balance offers similar risk control. For example: Two narrow-range, 30 minute
bars represent short-term balance. A breakout from that short-term balance often
marks the start of a new short-term auction. Your stop is placed just back within
the balance. Thus, risk is limited and the potential is far greater than the risk.

Jim Dalton

4) On the fourth day of trading, Jim Dalton said to me, �Give gifts wisely.� More
is not necessarily better. A single, well-selected gift may surpass several smaller
inexpensive gifts. And the same holds true in trading. More information is not
necessarily better. In the book, Steal like an Artist, author Austin Kleon tells us
that subtraction is often the key to creativity. In short: Don�t overload yourself
with unnecessary info.

Jim Dalton

5) On the fifth day of trading, Jim Dalton said to me, �Look at the real value.�
The price of a gift isn't as important as its ability to pass the test of time.
Actual value may not even be related to price. In trading, price only advertises
opportunity, and time regulates all opportunities. Value and price are totally
different - I'll take value this holiday.

Jim Dalton

6) On the sixth day of trading, Jim Dalton said to me, �Focus on risk for the
coming year.� You can control risk but you don't have a say in return. Remember
that the market can�t be controlled. But you can control your focus on what�s
coming next.
Jim Dalton

7) On the seventh day of trading, Jim Dalton said to me, �Make a New Year�s
resolution to be a selective trader.� Just as some people have a tendency to buy
too many gifts during the holidays, likewise for many traders who overtrade.
Overtrading adds transaction costs and maybe even more importantly, begins to
deplete you of very valuable mental capital. This holiday season, keep in mind that
the biggest trading mistakes often occur when we are drained mentally.

Jim Dalton

8) On the eighth day of trading, Jim Dalton said to me, �Get out of a bad trade.�
The best trade you will often make is getting out of a bad trade. Too many traders
stubbornly hold onto losing trades in the hopes that their egos will be saved and
the trade will come around. Even more importantly, bad trades that you are holding
onto keep you out of good trades.

Jim Dalton

9) On the ninth day of trading, Jim Dalton said to me, �Resolve to be kinder to
yourself.� There is much evidence to suggest that good sleep, exercise, and a
healthy diet will enhance your trading. (P.S. Send the not-so healthy snacks to me
for safe keeping.)

Jim Dalton

10) On the tenth day of trading, Jim Dalton said to me, �Prepare. Prepare.
Prepare.� The most important part of your trading takes place prior to the opening.
You can react more quickly when you�re properly prepared.

Jim Dalton

11) On the eleventh day of trading, Jim Dalton said to me, �Stay in the flow of the
market.� It�s easy to get distracted with funny emails, nonsense phone calls, and
errands. I've often wondered how the market knows that I just stepped out. Don�t
get caught off guard. Opportunities often appear out of nowhere. And auctions can
change quite suddenly.

Jim Dalton

12) On the twelfth day of trading, Jim Dalton said to me, �Don�t listen to the
talking heads.� Cognitive dissonance is often a trader�s biggest obstacle. I don't
listen to the media voices or read the economic releases. I focus on what the
market is telling me. It�s a hard habit to break, but crucial that you do. The
opinions that matter are expressed via real orders being placed; market-generated
information. All I want to know is the expected time of the release. Only after
that will I listen to the market.

Jim Dalton