RISK MANAGEMENT
The first thing I teach my new students is RISK MANAGEMENT. My trading changed the day I understood the implication of trading a 0.1 lot size on a 200$ trade account. I tell them there is no need to be a trader if you don't follow risk management because you will never make money in this business. Risk management is indispensable for success in trading.
RECORD, REPORT, AND REVIEW
Many traders focus on strategies, signals, and even complicated indicators and forget to do the basic things. What changed my trading was accountability. You must be able to evaluate your performance every week. You can only evaluate your performance if you have DATA. This brings me to the first requirement each new trader must have; a Notebook or what people call a trading journal
Record:
You must record critical information on every trade you execute. Pair, volume, Stop Loss, Take Profit, Volume, Buy/Sell, reasoning for entering, Profit or Loss.
Report:
This is the simple process of coming to note down the outcome of the trade when it closes. Did you close it manually or did it hit your preassigned targets?
Review: A good trader should make time every Friday and go over their report for the week. Look at the trades that were taken go back to the charts and ask critical questions. Did I follow my strategy or this was just an impulsive trade or a revenge trade? was it profitable, was I stopped because I was wrong or maybe there was a news spike? You will not believe the amount of changes you can make to your trading just by doing these few things.
HOLY GRAIL STRATEGIES
Most new traders go about paying for signals or follow traders, learning complicated strategies and indicators. The basic tenets of price action are what every trader needs to master. As a CMT level two trader, I have studied so much but I don't use a third of all that Knowledge to trade. If I had taken all that time learning how to be disciplined and manage my psychology, I would be far ahead of where I am today. Keep it simple, learn the OCHL price points, understand candle sticks and candle stick patterns, Trend direction, Support and resistance, Demand and supply levels, and Fibonacci. With a mastery of this, you can make all the money you want in trading.
NO STOPS AND TAKE PROFITS
Many New traders get into trades without predefined stops and take profits. These are so critical because you calculate your risk based on your account size and can pre-determine the amount of money you want to lose in that trade. By setting these loss and profit targets, you are in a better place psychologically. The markets are dynamic and always ZigZag up and down. With Take Profits you look in some profits each time you trade which is equivalent to paying yourself.
TRADE WITH THE TREND
Why do I even have to write about this? Just by following this basic principle, you can eliminate 60% of your losses. Learn early how to identify the trend direction and try as much as possible to pick your trades in that direction. With time you will able to appreciate reversal trades more and start taking them. As a new trader, TRADE WITH THE TRADE.
These are some of the aspects that can help you push your trading to the next level.
The first thing I teach my new students is RISK MANAGEMENT. My trading changed the day I understood the implication of trading a 0.1 lot size on a 200$ trade account. I tell them there is no need to be a trader if you don't follow risk management because you will never make money in this business. Risk management is indispensable for success in trading.
RECORD, REPORT, AND REVIEW
Many traders focus on strategies, signals, and even complicated indicators and forget to do the basic things. What changed my trading was accountability. You must be able to evaluate your performance every week. You can only evaluate your performance if you have DATA. This brings me to the first requirement each new trader must have; a Notebook or what people call a trading journal
Record:
You must record critical information on every trade you execute. Pair, volume, Stop Loss, Take Profit, Volume, Buy/Sell, reasoning for entering, Profit or Loss.
Report:
This is the simple process of coming to note down the outcome of the trade when it closes. Did you close it manually or did it hit your preassigned targets?
Review: A good trader should make time every Friday and go over their report for the week. Look at the trades that were taken go back to the charts and ask critical questions. Did I follow my strategy or this was just an impulsive trade or a revenge trade? was it profitable, was I stopped because I was wrong or maybe there was a news spike? You will not believe the amount of changes you can make to your trading just by doing these few things.
HOLY GRAIL STRATEGIES
Most new traders go about paying for signals or follow traders, learning complicated strategies and indicators. The basic tenets of price action are what every trader needs to master. As a CMT level two trader, I have studied so much but I don't use a third of all that Knowledge to trade. If I had taken all that time learning how to be disciplined and manage my psychology, I would be far ahead of where I am today. Keep it simple, learn the OCHL price points, understand candle sticks and candle stick patterns, Trend direction, Support and resistance, Demand and supply levels, and Fibonacci. With a mastery of this, you can make all the money you want in trading.
NO STOPS AND TAKE PROFITS
Many New traders get into trades without predefined stops and take profits. These are so critical because you calculate your risk based on your account size and can pre-determine the amount of money you want to lose in that trade. By setting these loss and profit targets, you are in a better place psychologically. The markets are dynamic and always ZigZag up and down. With Take Profits you look in some profits each time you trade which is equivalent to paying yourself.
TRADE WITH THE TREND
Why do I even have to write about this? Just by following this basic principle, you can eliminate 60% of your losses. Learn early how to identify the trend direction and try as much as possible to pick your trades in that direction. With time you will able to appreciate reversal trades more and start taking them. As a new trader, TRADE WITH THE TRADE.
These are some of the aspects that can help you push your trading to the next level.