1. Need to internalize lots of trading simulation of specific set-ups in real-time to trade effortlessly
2. Need to trust money management system to weather +10 losses in a row
3. Tuff to internalize that its the 5-6 huge monthly runners that is the big pay-off days
4. Must master +3 trade set-ups to make money consistently month to month.
5. It takes considerable time to mathematically think and act like a trader
6. Trading is a performance skill which requires mastery of every element of trading
7. It requires time capital and considerable effort to achieve the experience to make it effortless and automatic
8. It takes several attempts at different trading methodology to sync with a trader’s personality and cognitive strengths
9. It takes time to set and internalize specific rules that embed a sense of mastery
10. To survive in trading requires weathering the lengthy learning curve
Archives of “rules” tag
rssMARKET WISDOM
A list of golden sayings and rules I have gleaned from many sources:
- Plan your trades, trade your plan.
- Trade Quality, Not Quantity.
- Keep it simple.
- Don’t look for a reason to enter the market, look for a reason NOT to enter.
- Don’t act due to “Newbie Nerves”
- Don’t make up a trade. If you have to look, it isn’t there.
- Never play with scared money.
- You are not the market.
- Buy dips in an uptrend, sell rallies in a downtrend.
- Do not try to pick tops and bottoms.
- It is only divergence if it came off a retracement – not a sideways market.
- Indicators warn, price action confirms.
- Divergence is early, cross-overs are late.
- You cannot expect your positions to go immediately into the money.
- Divergence means a detour, but not necessarily a new trend.
- No-one knows what will happen in the markets.
- Standing aside is a position.
- Subordinate your will to the will of the market.
- Large ranges beget small ranges, small ranges beget large ranges.
- Once a thing is set in motion, it tends to stay in motion.
- Sniper-rifle, not a shotgun.
- Cut your losses short, let your profits run.
- Only move stops in the direction of your position.
- Do not let a winner turn into a loser.
- Never add to a losing position.
- Forget losses quickly. Forget profits even quicker.
- Consistent behavior equals consistent results.
There are probably more, send ’em in…
Trading Rules: Strategies For Success
1. Divide your trading capital into ten equal risk segments
2. Use a two-step order process
3. Don’t overtrade
4. Never let a profit turn into a loss
5. Trade with the trend
6. If you don’t know what’s going on, don’t do anything
7. Tips don’t make you any money
8. Use the right order to get into the markets
9. Don’t be whimsical about closing out your trades
10. Withdraw a portion of your profits
11. Don’t buy a stock only to obtain a dividend
12. Don’t average your losses
13. Take big profits and small losses
14. Go for the long pull as an outside speculator
15. Sell shorts as often as you go long
16. Don’t buy something because it is low priced
17. Pyramid correctly, if at all
18. Decrease your trading after a series of successes
19. Don’t formulate new opinions during market hours
20. Don’t follow the crowd – they are usually wrong
21. Don’t watch or trade too many markets at once
22. Buy the rumor, sell the fact
23. Take windfall profits when you get them
24. Keep charts current
25. Preserve your capital
26. Nothing new ever occurs in the markets
27. Money cannot be made every day from the markets
28. Back your opinions with cash when they are confirmed by market action
29. Markets are never wrong, opinions often are
30. A good trade is profitable right from the start
31. As long as a market is acting right, don’t rush to take profits
32. Never permit speculative ventures to turn into investments
33. Don’t try to predetermine your profits
34. Never buy a stock because it has a big decline from its previous high, nor sell a stock because it is high priced
35. Become a buyer as soon as a stock makes new highs after a normal reaction
36. The human side of every person is the greatest enemy to successful trading
37. Ban wishful thinking in the markets
38. Big movements take time to develop
39. Don’t be too curious about the reasons behind the moves
40. Look for reasonable profits
41. If you can’t make money trading the leading issues, you aren’t going to make it trading the overall markets
42. Leaders of today may not be the leaders of tomorrow
43. Trade the active stocks and futures
44. Avoid discretionary accounts and partnership trading accounts
45. Bear markets have no supports and bull markets have no resistance
46. The smarter you are, the longer it takes
47. It is harder to get out of a trade than to get into one
48. Don’t talk about what you’re doing in the markets
49. When time is up, markets must reverse
50. Control what you can, manage what you cannot
The 20 Rules of Trading
- Never, under any circumstance add to a losing position…. ever! Nothing more need be said; to do otherwise will eventually and absolutely lead to ruin!
- Trade like a mercenary guerrilla. We must fight on the winning side and be willing to change sides readily when one side has gained the upper hand. (more…)