Most people when they think trading they think how can I make a lot of money fast. They usually start to trade and then reality sets in; they lose their money; they blame the system or the market maker and they never trade again.
Here are some ideas to avoid falling in to that cycle:
Position sizing: if you're just starting you shouldn't be trading with a two thousand, ten thousand or 100 thousand dollar account. Set yourself a limit that to you is insignificant. For example what is the most you're comfortable losing in a single trade? For me that's 20-50 dollars. For you it might be 5-100 dollars. Adjust your position size so that when you factor in your stop loss you lose no more than that.
Then once you become profitable you gradually increase this amount. There is no reason for beginners to have a 10000 dollar account. Stop doing it!
Learn from past mistakes and winners: Make a note of each trade. If a win why do you think it was a win. If a loss where did you go wrong and what can you do differently in future. Maybe a change in strategy is needed or if it's bad luck maybe take a break.
Don't do the same thing over and over again- self explanatory. If it isn't working you need to change your strategy.
Are you gambling? It's ok to gamble. Just don't let it ruin your life.
Having unrealistic expectations: It's true good traders can make more money than brain surgeons, but most will fail. Don't expect to make a ton of money right from the start. Or possibly ever!
Having a system: have a strategy.
Controlling your emotions: This is literally a game of emotions- greed and fear. You have to learn to tame these emotions if you want to succeed.
Don't be a technical analysis robot: technical analysis is like a map of what price is doing. You won't last long trading if you don't understand it, but it often gives false signals. (And even traps!) Therefor always take trade setups with a grain of salt. I.E. use your best judgement.
These are some of the things that allow me to keep going as a trader even though I've been learning for 2 or 3 years now.
Trading is part art, part game, part work, and can be enormously rewarding - as a hobby or a profession, but it can also be emotionally and financially draining. If you're in a negative cycle consider the points above and if you're still losing maybe it's time for a break. Good luck!
Here are some ideas to avoid falling in to that cycle:
Position sizing: if you're just starting you shouldn't be trading with a two thousand, ten thousand or 100 thousand dollar account. Set yourself a limit that to you is insignificant. For example what is the most you're comfortable losing in a single trade? For me that's 20-50 dollars. For you it might be 5-100 dollars. Adjust your position size so that when you factor in your stop loss you lose no more than that.
Then once you become profitable you gradually increase this amount. There is no reason for beginners to have a 10000 dollar account. Stop doing it!
Learn from past mistakes and winners: Make a note of each trade. If a win why do you think it was a win. If a loss where did you go wrong and what can you do differently in future. Maybe a change in strategy is needed or if it's bad luck maybe take a break.
Don't do the same thing over and over again- self explanatory. If it isn't working you need to change your strategy.
Are you gambling? It's ok to gamble. Just don't let it ruin your life.
Having unrealistic expectations: It's true good traders can make more money than brain surgeons, but most will fail. Don't expect to make a ton of money right from the start. Or possibly ever!
Having a system: have a strategy.
Controlling your emotions: This is literally a game of emotions- greed and fear. You have to learn to tame these emotions if you want to succeed.
Don't be a technical analysis robot: technical analysis is like a map of what price is doing. You won't last long trading if you don't understand it, but it often gives false signals. (And even traps!) Therefor always take trade setups with a grain of salt. I.E. use your best judgement.
These are some of the things that allow me to keep going as a trader even though I've been learning for 2 or 3 years now.
Trading is part art, part game, part work, and can be enormously rewarding - as a hobby or a profession, but it can also be emotionally and financially draining. If you're in a negative cycle consider the points above and if you're still losing maybe it's time for a break. Good luck!