This is where all the thinking in trading comes into play, while writing your trading plan. Once you have created your rules to trade by, you become more systematic and logical in your thought process for executing successful trades. Your personal trading plan will include every step of the trade from identifying to exiting your trade. By having your setup written down in your plan, you will have a better chance of using patience and discipline to wait for your entry. Otherwise, you will use emotions to enter trades and we all know where that will get you. After entering your trade, you will have more confidence because you have back-tested your strategy and know that it has a successful track record and will give you that extra edge over your competition. Identifying your entry strategy will help you execute your strategy in an efficient manner with no hesitation. There will be no guessing or wondering what to do once your setup is identified, you just click and go. Your risk management is also pre-defined so your initial protective stop is set on entry and you know when you will be moving your protective stop to breakeven after the market moves in your direction by a certain amount. Of course, our price target is also known in advance and how we will exit the market at this target. Will we have a set price target, a trailing stop, a time stop, etc.?
Archives of “personal trading” tag
rssSet Goals
Each of us needs to set goals within our personal trading programs to become successful.
We all need to know exactly what those goals mean and how to best achieve them.
It will not happen overnight, however many people seem to start strong when they decide to be a trader but then quit when things do not happen fast enough for them. Or maybe they do not start very strong, but get serious when they get into their routine of executing trades and soon become discouraged and stop doing what was working. Or maybe they finish each session strong, but that was just to recover what was lost during the rest of the time when they were not focusing on their trading strategy.
To reach a level of continuing growth as a trader, each of us must have a plan in place and then ensure that we do everything possible to begin each day very strong in our preparation steps. We must then continue to make strong confident decisions while we trader even when the results are not what we expect.
Finally, we all need to have a target each day that determines when to finish our session and be strong enough to adhere to that plan. If we keep going, it generally leads to massive losses and frustration which then stays with you until you begin to trade again. This will cause a very sour perspective of trading when you attempt to start a new session. Start Strong. Trade Strong. Finish Strong!
Set Goals
Each of us needs to set goals within our personal trading programs to become successful.
We all need to know exactly what those goals mean and how to best achieve them.
It will not happen overnight, however many people seem to start strong when they decide to be a trader but then quit when things do not happen fast enough for them. Or maybe they do not start very strong, but get serious when they get into their routine of executing trades and soon become discouraged and stop doing what was working. Or maybe they finish each session strong, but that was just to recover what was lost during the rest of the time when they were not focusing on their trading strategy.
To reach a level of continuing growth as a trader, each of us must have a plan in place and then ensure that we do everything possible to begin each day very strong in our preparation steps. We must then continue to make strong confident decisions while we trader even when the results are not what we expect.
Finally, we all need to have a target each day that determines when to finish our session and be strong enough to adhere to that plan. If we keep going, it generally leads to massive losses and frustration which then stays with you until you begin to trade again. This will cause a very sour perspective of trading when you attempt to start a new session. Start Strong. Trade Strong. Finish Strong!
My personal trading rules
There’s really just two rules:
1) If I have an edge – take a position.
2) When the edge is no longer there – get out.
It doesn’t matter what my entry point was and it doesn’t matter how much I’ve gained or lost on the trade. When the edge is no longer there, I shouldn’t be either. And when it is there – I should stay in the trade. This actually requires some discipline because there’s always a temptation to bail when it begins to go against you and there’s also always a temptation to try for too much when things are going your way.
Self-Discipline in Trading
Having self-discipline is having the ability to follow through on your plans and goals. Often times we get tugged in various directions and enticed by making choices that don’t help us along our path to our goals and fulfillment.
“The path of least resistance is what makes all rivers and some men crooked.”
– Napoleon Hill
Self-discipline is the ability to make the conscious choice (ultimately it becomes a habit) of doing the thing that will move you towards your goal – and sometimes it’s the hard or unnatural or unpopular thing to do. It’s foregoing instant gratification for the longer term objective. Typically, however, people operate on autopilot and this is dangerous when you have not yet developed the right ‘habits’ for success.
In the trading game, you must have self-discipline. You must look at the entire forest and not focus on one tree. If you get too caught up in each and every trade, you will lose sight of the larger goal.
The key is to care a lot about your overall trading progress, but not care too much about any individual trade.
Your Identity also plays a huge role in this because if you see yourself as someone who lacks self-discipline, then all the will power in the world will not overpower this. You are someone, in your mind, who lacks self-discipline.
So the key components to have self-discipline in Trading are: (more…)
Become a Great Trader Without Trading
Sometimes history can assist us in becoming greater at what we want to do.
However, one of the biggest struggles we all face is that fact that we generally know what we need to do, but because we do not like the task, we do not do it.
As a trader, we all want to become better. Instead of using only our time in front of the charts to enhance our skills, use the time that we cannot even trade to become better.
Every Saturday-Sunday, the markets are closed. This is the perfect time to have you own personal trading school. Sit down with your trading journal of all of the trades you made last week along with your charts or the screen shots of your executed trades and analyze what you actually did.
You will soon discover that the information surrounding these trades will provide a wealth of information that will assist you in seeing your areas of strength and areas that you need to strengthen.
If we never look at where we have just been, then we will never be sure that the path we are continuing on will get us to our desired destination.