5 Key Trading Tips for BeginnersWelcome back everyone to another post! In this article we will be explaining 5 key pointers (tips) for new individuals entering the trading space.
When it comes to trading first there is “ understanding ” before we begin the 5 keys steps. Let me assist you in understanding what will happen when you take on trading.
Trading is a challenge. Not a video game challenge, not a math test challenge – a * Challenge * One that will break you. Trading will break you mentally, physically, spiritually and financially. It is an eye-opening journey.
Trading will teach you a lot about yourself, and it will teach you a lot about discipline, patience and how you can analyze markets.
I saw a quote somewhere, it said trading: “ Trading is the hardest way, to make easy money ” and they are right.
You will be learning how to manage risk, control your emotions, understand your own decision-making patterns. These are all invaluable lessons for life, as well as trading.
Sounds great! But then there are the losses, what you lose to gain all this. Trading isn’t something that you can learn overnight – all those posts you see about a young 17-year-old “ cracking the code ” is rubbish. Why? Because they haven’t learnt life lessons.
You can make money fast, but you will lose it faster if you don’t know how to manage it.
Trading will drain every bit of energy out of you. You will feel like you’re falling behind, you will eventually collapse at every loss and become frustrated. The market will test you; the market doesn’t give a damn about you – you accept the risk when you take on trading and since you’re the one making the trades, it’s you VS you.
You’re testing yourself. You agree to test your patience, your confidence, your mindset. Doing so will make progress feel nonexistent or slow.
Every day, and every trade you will question yourself, wondering if “trading” is even for you. Sometimes it will feel like you’re going in circles. You will continue to make mistakes repeatedly. It will become exhausting but remember – only experience and your own strengths will allow you to succeed. Only those who can endure the grind without giving up will make it.
So, let’s start off the 5 key pointers that will prepare you.
1) Prioritize Risk Management Over Profits:
Most newbies focus first on “ making money ” rather than safeguarding capital. The reality is that surviving in the market is way more important than winning every trade you see or come across.
Key Points:
Determine risk per trade: A common rule is risking no more than 1-2% of your trading account on a single trade. This way even a string of losses will not wipe you out.
Always use stoploss: A defined maximum loss per trade enforces discipline and emotions to stay in check.
Position sizing: Your sizing should be proportional to what you’re willing to lose on each trade. Bigger trades amplify the losses, but they also amplify the profits.
Why it matters:
Without strong risk management, even a high win-rate strategy can fail. Protecting capital ensures you’re still in the game when opportunities arise.
2) Develop a trading plan and stick to it .
Random reactive trading is the best way to lose money. Build your plan overtime.
Key points:
Define your strategy: Building your strategy is the longest part, constant back testing and forward testing, refining and rebuilding. You’re not “switching” your strategy if you’re adding something small to it, you’re changing it if you eliminate the whole thing.
Identify your form of trades, short, mid, long term or swing trades.
Set clear rules: Don’t leave anything to chance, for example “I only enter trades if price closes above the 50ema and RSI is above 50”
Journalling trades: Ensure to journal all your trades, “How do I journal” Easy. Record the time, date, symbol, pair, what model/system you used, images, your entry, tp and exit, why and for how long you’ll have it open.
Why it matters:
Consistency is a key, it pairs with discipline, psychology and lingers with risk management. Traders who follow a disciplined system perform better than those to trade off an impulsive feeling. Other words “Gamble”
3) Master one market and one system first:
Beginners usually spread themselves too thin, trying forex, crypto, stocks and commodities all at once – Unfortunately for me I made this mistake at the start which made it very difficult! – Don’t do this. Stick to one market.
Key points:
Pick one market: Each market has its own rhythm, volatility, and liquidity. Teaching one thoroughly allows you to understand everything about it.
Focus on one system: Instead of trying every new system from you tubes or forums, master one approach and refine it onwards e.g. – you trade FVGs, Win rate is 50% once you add Fibonacci it might be e.g. 65%
Avoid information overload: Social media and trading forums are filled with conflicting advice, stick to your chosen approach and refine it. People say you need to have 12-hour trading days. If you do this, you will FAIL. You will grind yourself into the ground and face burnout making it very difficult to get back up again. Limit yourself to how much trading and trading study you do a day. Eg 10 back test trades, 3 real trades, 3 journaled trades, 1 hour of studying and researching the market.
Without strong risk management, even a high win-rate strategy can fail. Protecting capital ensures you’re still in the game when opportunities arise.
Why it matters
Depth beats breadth early on. Mastering a single market and system will allow you to build confidence and improve your edge.
4) Understand the Psychology of trading.
Trading isn’t just numbers: as mentioned in “understanding” it’s a test of emotional control, fear, greed and impatience.
Key points:
Emotions vs logic: ensure you recognize emotional reactions like FOMO (Fear of missing out) or revenge trading. Pause before reacting to a trade that will go against you.
Set realistic expectations : Markets move slowly. Sometimes for months, don’t expect huge gains overnight. Just like DCA focus on compounding. Compound your knowledge and skill set.
Mindset training: Techniques like medication and journaling as well as visualization can help reduce stress and maintain discipline.
Why it matters:
Even a diamond system can still fail if emotions drive your actions. Psychology often determines long term success, more than technical skill.
5) Prioritize learning. Then earning.
Beginners fall into the trap of trading being a “get rich quick” scheme. But the real investment is learning how the market works.
Key points:
Paper and demo trade first: Practice on demo accounts before you use real money – you will be surprised how many times you will fail. It’s better to fail with simulation money than your McDonalds weekly wage.
Review every trade: Analyze your losing trades, but also your winning trades. Find patterns and areas to improve.
Continuously educate yourself: Read books about the mind, about habits, watch market analysis but critically, apply what you learn and don’t just collect information and not use it.
Why it matters:
Earnings are just the byproduct trading. The faster you learn and adapt, the sooner your profits will appear. Treat early losses as tuition. Not failure.
Thank you all so much for reading.
I hope this benefits all those who are starting off their trading journey. If you have any questions, let me know in the comments below!
