Dear traders, in this article I am going to describe some important points to make your trading a successful journey. This is based on my own experience and tied to my Trading Method.
1- You must have a Trading Plan. You must trade what you know and always trade the same instruments that you perfectly know. Trading everything anytime for the sake of trading will just lead you to fail. Having a Trading Plan does not mean that you will never loose, we all loose positions sometimes and that is perfectly normal, but this Trading Plan will always help you to stay on focus and come back when consecutive loses arise, because simply, you know what you are trading, you know the instruments you are trading, in other words, You Know What You Are Doing.
2- Risk Management. How many times have we been tempted to enter a position with big lot-size? There are times that you feel so sure about a position that you want to place big money on it. You never have to fall into that temptation, else, you could have your account wiped out in just few trades.
It is imperative to apply a Risk Management strategy. Use a small amount (2 - 10% of your balance) on every trade. Never use more than that.
3- Capital Preservation. This is a very important point. You must focus on always preserve your investment capital, this is tied with your Risk Management strategy with the objective to not to loose the initial investment. Many times you will find yourself in the situation where your investment is remaining at 70 - 80%, at that moment you must concentrate and keep it by all means, using all the strategies possible in order to not to loose more. Strategies can be trading less, using very small % on every trade, trading when you clearly see a trade, take advice, etc...
4- Do not Overtrade. Overtrading is also a mistake made by many traders and this overtrading is mostly happening when you are having 3 or more trades loosing in a row, the reaction many have is to trade more to try to recover the losses, well this is exactly what you don't have to do. Just close your day and come back tomorrow or when you'll see the opportunity to enter back again into the market. Overtrading can kill your account.
5- Relax. Learn to relax as often as you can, every day or 3 times a week by doing some sports, meditation, yoga or any activity that makes you relax and release any stress that trading and concentration may cause. Relaxing will help you to think better, to concentrate better, to renew your view on the markets and to place better trades.
6- Be patient and constant. Patience is very important in the life of a trader, without patience you will not be able to follow your Trading Plan, you will not be able to think better, you will not be able to stop when needed and most important, you will not be able to become the trader you are dreaming of.
Also a trader must be constant, every day, every week, every month and every year, you must be executing your plan without falling in bad feelings or mood, fatigue or just simple loosing patience... you must continue making what has been planed since the beginning and forever. By being constant, you will achieve the success you are looking for in your trading activities.
7- Strong minded. As a trader, you have to be prepared to assume loosing trades and sometimes loosing trades consecutively a whole week or even a month. Psychologically you must be strong and never loose focus and continue with your Trading Plan.
With all those points clear in your mind and well prepared, you will be a good and respectable trader and success will be on your side.
If you have any questions and/or help on your trading activities, please feel free to contact me any time, I will be glad to help you!