Consistently profitable traders have a lot of things in common. Watching how they act and following their ideas & thoughts we can spot a lot of commonalities among them. In this post, I have collected 8 trading habits that a trader should have to become successful.
1️⃣ - Realistic Expectation & Vision
Many traders, most often beginners, commonly fall for the trap of wishful thinking. When analysing the charts, they usually only view the market from one bias and only perceive price heading in one direction.
And this is typically the one that their own analysis is pointing towards. However, going into each trade with a realistic expectation that the market doesn't care what you think may happen, and being prepared for a trade to go wrong will help keep you level headed.
2️⃣ - Anticipation of Different Outcomes
Anything can happen in financial markets and for this reason, professional traders always justify their decisions in probabilities.
They understand that 100% chances do not exist so looking at all possible probabilities before entering any trades, the trader is always ready for completely different outcomes and accepts each and every move given by the market.
3️⃣ - Emotional Stability
The market is a wild beast who always wants to bite us and most of the time it manages to do that e.g. drawdowns & losing streaks...
Those who trade for at least 1 year know how unpredictable and unstable the market can be. A perfectly looking trading setup can easily turn into a big losing trade.
Of course, that is painful and of course with more & more losses, the anxiety will begin to chase us, the stress will overwhelm us and you may begin to start second guessing yourself.
Only by remaining stable and calm, you will manage to overcome the negative periods. Learn to control your emotions, learn to take losses!
4️⃣ - Continuous Learning
The markets are infinitely deep in their nature. Trading & constant monitoring of the market always unveil new, uncharted elements and things.
Throughout all my years of day trading, I can't help wondering how many new things I learn each and every day. With continuous learning you evolve, you become better and it improves your trading performance & results.
5️⃣ - Flexibility & Adaptivity
The markets are always changing. If you were trading before COVID crisis, I guess you feel how the reality among us shifted. With fundamental changes in our daily lives, the markets changed as well.
It is hard to say what exactly has altered though, however, we all can feel it. In order to survive in a constantly changing environment we must always be adapting and never stagnant.
6️⃣ - Trade Journaling
Pro traders always assess their past performance & results. They track each and every trading position that they opened.
Both losing trades and winning trades require analysis and observations. Only by studying the past results the trader can improve his trading performance and evolve. Only by identifying mistakes & peculiar commonalities, the trader learns to lose less than he makes.
7️⃣ - Risk Management
90% of traders lose 90% of their funds within 90 days and under 90 trades. This is a well known statistic in the trading industry and aside from psychological factors, it mainly boils down to incorrect risk management.
If you're looking to survive in this game and have a long, prosperous career in trading. You must have your risk management locked down.
One beneficial risk management habit to develop is to not enter any trades unless they have a risk:reward ratio of at least 1:3+.
8️⃣ - Trading Plan
Sticking to your trading plan is one way of promoting long-term success throughout your trading journey. Undoubtedly, you will go through many psychological ups & downs, mental battles and periods of low confidence.
Abiding by your own trading plan will help assist in ensuring that you don't step out of line from your own trading rules and allow you to stop yourself from developing bad habits overtime.
9️⃣ - Constant Practice
Professional traders never stop, they always watch the charts, they always monitor the prices, and follow the market.
Trading requires constant TRADING. Just spending one single week on a vacation without charts, you can not imagine how hard it is to return back. The trading skills must be constantly maintained.
1️⃣ - Realistic Expectation & Vision
Many traders, most often beginners, commonly fall for the trap of wishful thinking. When analysing the charts, they usually only view the market from one bias and only perceive price heading in one direction.
And this is typically the one that their own analysis is pointing towards. However, going into each trade with a realistic expectation that the market doesn't care what you think may happen, and being prepared for a trade to go wrong will help keep you level headed.
2️⃣ - Anticipation of Different Outcomes
Anything can happen in financial markets and for this reason, professional traders always justify their decisions in probabilities.
They understand that 100% chances do not exist so looking at all possible probabilities before entering any trades, the trader is always ready for completely different outcomes and accepts each and every move given by the market.
3️⃣ - Emotional Stability
The market is a wild beast who always wants to bite us and most of the time it manages to do that e.g. drawdowns & losing streaks...
Those who trade for at least 1 year know how unpredictable and unstable the market can be. A perfectly looking trading setup can easily turn into a big losing trade.
Of course, that is painful and of course with more & more losses, the anxiety will begin to chase us, the stress will overwhelm us and you may begin to start second guessing yourself.
Only by remaining stable and calm, you will manage to overcome the negative periods. Learn to control your emotions, learn to take losses!
4️⃣ - Continuous Learning
The markets are infinitely deep in their nature. Trading & constant monitoring of the market always unveil new, uncharted elements and things.
Throughout all my years of day trading, I can't help wondering how many new things I learn each and every day. With continuous learning you evolve, you become better and it improves your trading performance & results.
5️⃣ - Flexibility & Adaptivity
The markets are always changing. If you were trading before COVID crisis, I guess you feel how the reality among us shifted. With fundamental changes in our daily lives, the markets changed as well.
It is hard to say what exactly has altered though, however, we all can feel it. In order to survive in a constantly changing environment we must always be adapting and never stagnant.
6️⃣ - Trade Journaling
Pro traders always assess their past performance & results. They track each and every trading position that they opened.
Both losing trades and winning trades require analysis and observations. Only by studying the past results the trader can improve his trading performance and evolve. Only by identifying mistakes & peculiar commonalities, the trader learns to lose less than he makes.
7️⃣ - Risk Management
90% of traders lose 90% of their funds within 90 days and under 90 trades. This is a well known statistic in the trading industry and aside from psychological factors, it mainly boils down to incorrect risk management.
If you're looking to survive in this game and have a long, prosperous career in trading. You must have your risk management locked down.
One beneficial risk management habit to develop is to not enter any trades unless they have a risk:reward ratio of at least 1:3+.
8️⃣ - Trading Plan
Sticking to your trading plan is one way of promoting long-term success throughout your trading journey. Undoubtedly, you will go through many psychological ups & downs, mental battles and periods of low confidence.
Abiding by your own trading plan will help assist in ensuring that you don't step out of line from your own trading rules and allow you to stop yourself from developing bad habits overtime.
9️⃣ - Constant Practice
Professional traders never stop, they always watch the charts, they always monitor the prices, and follow the market.
Trading requires constant TRADING. Just spending one single week on a vacation without charts, you can not imagine how hard it is to return back. The trading skills must be constantly maintained.