Hey, there I hope you are having an amazing week so far. Today I placed one trade, which I will discuss. There is a lot to discuss, I will drop the video recap below, as well as the key points. Have a great night!
1) Know your exit point before you get in! Always set a predefined risk threshold before you enter any stock. Don’t be like most individuals who do NOT set a per-defined risk. Always prepare for the worst outcome. Rule #1 Always manage to cut losses quickly. Don’t hold and hope. Holding and Hoping is Not a Strategy.
2) Know WHY you are in the position: What is your Thesis? What the Pattern? What’s the game plan? The vast majority of Traders play follow the leader mentality. Don’t follow anyone’s Alerts. Only learn from those alerts to build upon your methodology. We all know what are doing …trying to make money ( you don’t make money in the markets; the only reason the money is there because other traders* other people put in there ) We all know how we are doing it, but not many people know WHY you in a position. Always ask WHY am I getting into this stock. What is the Thesis? You must think of yourself as a Scientist, test and refine over time. Lastly, exit when your Thesis is invalid. Just like the trade today. I was aiming for a Fader into the Bounce as I was shorting. Instead, there was a consolidation period the entire day, which was my point to exit since my thesis was invalid. Look understand YOU CAN ALWAYS GET BACK IN. Getting out is just very difficult for Traders. WHY? BECAUSE OF THEIR EGO. They would rather be right and wrong. They must protect their ego! Fuck your EGO. You must understand that this game, has nothing to do with being Right or Wrong. Trading is all about Playing the odds and probabilities. That’s all it is. Random Distribution. Does Summary always know why you are in a position? If you can’t answer that question, then you are only bound to get Random results.
3) AVOID FOMO: Don’t let FOMO get to you, there will always be another day. The markets are not going to go anywhere. Put things into perspective. Today I was not upset that I took a loss on my trade? Why? Because over the long run, I know that the odds will likely favor me. I did not revenge trade after closing my position. Yes, there was an opportunity to Short into the close, which would have worked out well, but that OK. The same old pattern will come back simply because Human Nature never changes. Sitting in cash is a position, very few understand this. The money is made by waiting for the small gazelle.
4) Focus on one or two set-ups that work for YOU! Not anyone’s else strategies! I will make this one sweet and simple. EVERYONE HAS THEIR OWN UNIQUE PERSONALITY, there is no one way to master the markets. Every Successful Trader that I have learned from has their own one or two go-to set-ups. Look I understand that in the beginning you are lost. I was there too! I am still learning. The hardest part is the start. This is very front in loaded. Yes, in the start you must test and test and most importantly fail in order to find out your Personality. I assure you, that you will find it, and when you find that edge you exploit it. As for me, I have 3 main Set-ups that appear in the Markets. Again, I don’t look to trade every day. I don’t wake up expecting to trade, I simply let the Trades come to me. if there is not an ideal set-up that fits my personality then it’s no deal, that simple. Over time you may find out that Trading LESS is its own EDGE. It sounds very counter intuitive, but over time I noticed by Trading less I am more profitable in the long run. There is a reason for that.
5) TRACK and Learn from Your Mistakes! Yes, you are going to make mistakes, in this game losing is a part of the game. That should not bother you if you know that you won the game before it even started. That sound like nonsense, but the best trades have won the game before it starts. Two words: EDGE and ODDS and PROBABILITIES. The only way you to progress as a trader it too makes mistakes, Failure is what gives success it’s flavor in the end! Every Trade I want you to track and ask what you did well, and most importantly what you could have done better next time. As for today’s trade, I was on the right track, as it did fade into the close, but next time I must be in the now moment. Don’t let the previous trade outcome interfere with the next one, again odds and prob. I missed the initial short into the close, which would have resulted in a great trade, but again the market is in constant motion.
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