How to Become Successful in Trading
How to become successful in Trading requires discipline. Discipline will put more money in your pocket and take less money out. The one constant truth concerning the markets is that discipline equals increased profits. THE MARKET PAYS YOU TO BE DISCIPLINED. If you trade with discipline in nine out of ten trades, then you can’t claim to be a disciplined trader, if the one undisciplined trade that will really hurt your overall performance for the day. Discipline must be practiced on every trade all the time. Being disciplined is of the most important things you can master. It is not a sometimes thing, its an always thing.
Lower your trading size when your trading poorly, all good traders should follow this rule. Why continue to lose on 1k share lot per trade when you could save yourself a lot of money by lowering your trade size down to 200 shares on your next trade? If I have two losing trades in a row, I always lower my trade size down to a 100 shares. If my next two trades are profitable, then I move my trade size back up to my original lot size. Lower your trade size, try to make a tick or two or even scratch the trade and then raise your trade size after two consecutive winning trades.
How to Become Successful in Trading…. Never turn a winner into a loser.
We have all violated this rule. However, it should be our goal to try harder not to violate it in the future. What we are really talking about here is the greed factor.
The market has rewarded you by moving in the direction of your position, however, you are not satisfied with a small winner. Holding onto the trade in the hopes of a larger gain, only to watch the market turn and move against you. Of course, inevitably you now hesitate and the trade further deteriorates into a substantial loss. Theres no need to be greedy. Its only one trade. Youll make many more trades throughout the session and many more throughout the next trading sessions. Opportunity exists in the marketplace all of the time. Remember: No one trade should make or break your performance for the day. Dont be greedy
DEVELOP A METHODOLOGY AND STICK WITH IT. DON’T CHANGE METHODOLOGIES FROM DAY TO DAY.
Write down the specific market setups that must take place in order for them to make a trade. I dont necessarily care what the methodology is, but I do want them to make sure that they have a set of rules, market setups or price action that must happen in order for them to make the trade. You must have a written game plan. If you have a proven methodology but it does not seem to be working in a given trading session, dont go home that night and try to devise another one. If your methodology works more than one-half of the trading sessions, then stick with it.
How to Become Successful in Trading, stick to the rules!!