1. Go online and connect with other traders, ask the right questions (keyword: right) and talk shop. Joining TradingView is the best decision I made by far since I started trading. Social networks add value and my trading has improved a lot by being exposed to different ways to trade and by being able to see what works and what does not. But never trust a trader at their word; always do your own research.
2. One thing is certain; there will be losing trades. With good money management techniques you give back little profit when the market moves against you and you can accept losing trades as a controllable cost of making yourself available for the winning trades.
3. You cannot control the outcome of a trade. You can only control the setup and the risk you accept.
4. Patience is key. That’s why I (being a day / swing trader) don’t work with daily targets, but rather with monthly targets, to avoid chasing trades and forcing setups that are sub par. Take only good set ups with sufficient confirmation and if you don’t see one: don’t trade.
5. No single system will be right 100% of the time. Build the case for entry, using several kinds of input into your decisions. Go for confluence to increase the edge.
6. Don’t psychologically micro manage your trades, monitoring each candle as it develops. Once stops and targets are clearly defined, let a trade play out. Sometimes stepping away from the screen helps.
7. A trading plan can help you identify whether a series of losses happened due to market conditions or due to trading errors.
8. I look at trading as running a small business with no customers, no suppliers, no psychical stock to maintain, no brick and mortar business space to rent, no government mandated opening hours, no chasing of your payments, no employees to manage and no colleagues to depend upon. What’s not to like?
9. It helps to be a positive person. I don’t mean delusional or overconfident (there are plenty of those), but just positive. Trading is an activity where analysis, risk and stress come together and your trading psychology will be helped greatly if you have a positive disposition.
10. Practise prudent portfolio management where you start small and slowly grow the portfolio step by step by adding more pairs / instruments.
We're resurfacing posts of the past with Editors' Picks! Your post from 2015 has been re-featured on the front page in 2021 🥳
Bullishcharts
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There Is Much More To Learn Grasshopper @JazForex
Captain_Walker
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Some of the above are about who we are - our personalities and our psychology. I wanted to add a few points from my own self-observation and having observed a bunch of people out there who are failed-traders (who have given up, and mouth off in some online forums and YouTube, that trading is nonsense).
Core personality features I see as particularly important in this business (and some do overlap each other):
1. Toughness and resilience - taking the hard knocks, not being crushed by failure, rising again, facing reality.
2. Determination - a refusal to accept defeat. Probably a double edged sword as it could lead to even more catastrophic failures by the most determined who just have not understood and applied the tried and test good principles.
3. Ability to filter out noise through approprtiate concentration - too much can be going on at times.
5. Emotional management.
6. Receptivity to new ideas and ways of doing things.
7. Mental flexibility.
8. Ability to reflect and accept evidence-based criticism.
9. Critical thinking skills.
10. Ability to learn from mistakes (even if repeated).
11. Self-management: Getting the basics right: sleep, food, recreation, time-management etc.
12. People management i.e. dealing appropriately all the naysayers who actually don't know what they're talking about.
I'm far from perfect in some of these areas but at least I can assess where I have my work cut out. One doesn't have to be a perfect being but if one knows ones weaknesses, that's tremendously better than not knowing. I share my thoughts if they benefit others.
JazzForex
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Thank you for this excellent comment, even though number 4 is missing ;-) they are all spot on. I wanted to list the ones I agree with most, but I agree with all.
Captain_Walker
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LOL! Thanks.. #4 is obviously attenton to detail!! :))
johncarter_oz
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You found the invisible point 13. Attention to detail :)
moneymaking
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Hey Jasper, these are great points that you have made here, some I already knew, but I enjoyed refreshing them, but some I didn't knew at all. I'm still working on stepping away from the screen and letting my trades play out by trading higher time frames, like 4 hr or daily, its a process that I'll keep working on. I also agree with joining Tradingview as my best decision that I've made. I got to learn so many different ways of trading the markets. It's amazing to see how different traders trade the markets so differently. BIG THUMBS UP to TradingView website creators and Thank you Jasper for sharing these critical points with all of us, truly appreciated :)
JazzForex
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You are welcome. Regarding number 6, knowing how to do something and actually doing it can be two different things. Its a but like dieting / eating healthy. I am sure we all know how to do that, but actually doing it is more about willpower / discipline than actual knowledge. Its the same with number 6.
moneymaking
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You are absolutely correct mate. Its all about discipline and willpower. You have to force yourself to start doing all these things. It's like adapting to a new habit, it will be difficult at first, but as you keep on doing it over and over again, it eventually becomes part of your daily routine. Thank you for the dieting analogy, appreciate it :)
watchtrend
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@moneymaking, sure agree with this, and on our side we expect a breakout on doge coin