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The obstacles of the day trader are :

  
  Education
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Fear – Fear causes the day trader to hesitate and freeze when positions should be entered and exited. Fear can also cause day traders to take losses,

 Doubt – Doubt causes great opportunity to be missed and causes a mind to be scattered and without firm direction.

Greed – Greed will cause day traders to hold onto positions too long often causing profit to turn into loss.

Hope – Hope will cloud the eyes of probability. Hope is not for day traders.

A Psychological Checklist for Traders

  
Analysis, Education
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Here is a checklist that might be useful for self-evaluation:
1) Have you experienced one or more recent large losses in markets that shook you emotionally?
2) Have you experienced a recent painful loss in your personal life that has left you feeling more vulnerable in your finances and/or your personal sense of security?
3) Have you experienced a recent threat to personal safety that shook you emotionally, such as a violent attack or a serious accident?
4) Do you find yourself emotionally “overreacting” to what should be normal trading stresses and losses? Are you experiencing significant anxiety, frustration, anger, or depressed feelings when trades don’t work out?
5) Do you find yourself “overreacting” in your trading behaviors during what should be times of normal stress? Are you freezing up and not acting on your ideas or impulsively lurching into trades after losing periods in markets?
6) Do you look back on your trading and feel confusion, shame, or puzzlement over actions that you took that run completely contrary to your plans for the day?
7) Have you tried to reduce your emotional and/or behavioral reactivity to markets, only to see the same destructive patterns return during times of stress? (more…)

10 Rules for Traders

  
  Education
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  1. Never add too a losing trade. In adding to a losing trade you are already wrong but now become more wrong with a bigger trading size. Adding to losers makes you a counter trend trader that usually ends badly.10-Rules

  2. Never lose more than 1% to 2% of your trading capital on any one trade. This means use position sizing and stop losses so when you are wrong the loss is not a big deal.
  3. Never trade anything you do not understand 100%. Stay away from trading futures, forex, or options until you understand the risk and how exactly they work.
  4. Always trade with the trend in your own time frame.
  5. Only look for low risk, high reward, high probability setups , when there is nothing to trade, trade nothing.
  6. Trade the chart and price action, not your own opinions or predictions.
  7. You have to trade your own way, the trading style that you are comfortable with that fits you.
  8. If you do not have a full trading plan with rules on entries, exits and risk management stop trading until you create one.
  9. The size of your wins and losses ultimately determine your trading success regardless of your winning percentage. 

  10. Your risk management rules will ultimately determine the success of your technical trading system.

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