..."Son, I've made a life out of readin' people's faces,

And knowin' what their cards were by the way they held their eyes."

That's the very first thing the gambler brings up, suggesting that "readin' people's faces" is the most important part of successful gambling. Same with stocks. Stocks trade on emotions first and logic second. It is powered by hope, fear, and greed - probably in that order. The key to reading the market is to understand human emotions correctly. The only thing is: you can't see other people's faces. But stocks have something better - charts. And while some faces can lie, charts can't. They reflect the collective action of the market participants. Not what they say they are going to do, not what somebody thinks they should be doing, but what they are actually doing. And since human behavior never changes, it repeats itself in predictable patterns. By studying and recognizing past patterns, a stock trader can predict future moves with a fair degree of accuracy.

"And the night got deathly quiet, and his face lost all expression."

Ah! Interesting how as soon the gambler starts talking about gambling his face becomes emotionless. Again, even though the market is driven by emotions, many successful moves are counter-intuitive, and the most important thing for a stock trader to do, besides reading other people's emotions, is to learn how to control his own emotions.

"If you're gonna play the game, boy, ya gotta learn to play it right."

Many people are drawn to stock trading by the allure of easy money and the glamour of day trading, but the fact of the matter is that by entering the market you are pitting your wits against the sharpest minds on Wall Street and if you don't know what you are doing they will take you for every penny you've got. Successful stock trading requires passion, dedication, hard work, and intelligence. The amount of money you can take out of the market is directly proportionate to the amount of time and effort you are willing to put into it. No short cuts.

"You got to know when to hold 'em, know when to fold 'em,

Know when to walk away and know when to run."

When the market is dealing, it's up to you to decide which stock trading opportunities to take advantage of. You don't have to own every stock that's going up - just the best. The key is to have as few criteria as possible to identify the biggest potential winners fast and pass up on the rest.

There will be situations when no matter how much DD you put into researching a stock, it will blow up in your face and you will have to take a loss. Some people want to know WHY a stock is tanking before taking action. This is dangerous. Oftentimes the truth is not known until the damage is done. Run! Ask questions later. You can always buy back if it was a false alarm and chalk up the loss to an insurance premium against an even bigger loss, or simply to the cost of doing business.

And sometimes it's best to stay on the sidelines, or walk away.

"You never count your money when you're sittin' at the table.

There'll be time enough for countin' when the dealin's done."

You haven't made any money until you sell. And even then not all of it belongs to you. In swing trading you take your gains in several lumps but incur losses in small increments throughout the year. When you go into cash, set aside a certain amount for future losses that are inevitable upon re-entry.

"Every gambler knows that the secret to survivin'

Is knowin' what to throw away and knowing what to keep."

Knowing when and what to buy is important, but equally important is knowing when to cut a loss, when to let a stock ride, and when to lock in your gain. You have to have clear sets of rules for all three.

"...ev'ry hand's a winner and ev'ry hand's a loser"

In the end, we are all looking at the same stocks. It's not the stock that makes you rich, it's what you do with it.

Some song.

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