Trading Basics

By | May 22, 2013
  • Remember that becoming a profitable trader is a journey, not just a destination. The perfect trader does not yet exist. Try to become a better trader each day and enjoy the progress you make. Concentrate on learning the craft of technical analysis and on improving your trading skills, rather than focusing solely on the amount of profit or losses in your trading.
  • Congratulate yourself and feel good about a trade when you have done what you were supposed to do, according to your trading plan–regardless of the profit or loss on the trade.
  • Don’t get overly excited about the winning trades or too depressed about the losing trades. Pro traders are just normal if they make money and lose money.
  • Do not expect certainty in a trade thinking it will be a super duper hit trade, Never be biased towards any trade you take. Try to train your mind to go with the flow.
  • The pain of standing aside and missing a good trade that your method told you to take is much worse than the pain of losing on a trade that you entered and exited properly and according to your trading plan.
  • Your own life experiences shape how you think about trading. If your first experience with trading was a negative one, the odds are high that you will not trade in that particular market again for a long time–and maybe never. The psychological impact of loss and defeat can be much greater and last much longer than the effects of physical pain. If you were not defeated psychologically by a negative trading experience, then the loss does not have such a negative and lasting impact.
  • Trading Education plays an important role in shaping the way traders think about trading.To succeed in trading,you need to have a proper mix of ” Mind, Method and Money”. If you are not good at it,find a mentor who can guide you off else you will lose your hard earned money before understanding the intricacies of trading.
  • Your ego and winning can make you broke. Winning can create powerful emotions that distort reality. The more you win, the better you feel, and your ego takes over. The joy of winning is what gamblers seek. A gambler will lose as many times as necessary just for the thrill of winning once.
  • Always remember this: You are the sole person responsible for winning or losing in trading. Don’t blame the market or your broker. Losses are an opportunity to focus on whatever problem occurred during the trade. Don’t get caught up in personal denial.
  • A successful trader quantifies, analyzes and truly understands and accepts risk. Emotional and psychological acceptance of risk is what determines your mental state in each trade. Individual risk tolerance and preferred trading timeframe make each trader unique. Select a trading methodology that reflects your preferred timeframe and risk tolerance.

 

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