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The 90-90-90 rule - Why do traders fail?"Many are called, but few are chosen". Ever heard this proverb? This is certainly true for trading, in fact, there is even a rule in trading about this, the 90-90-90 rule. So what does this rule say? "90% of traders lose 90% of their money in 90 days" 😱😱😱 That's right, statistics show that 90% of people who start trading lose the majority of their money in less than 3 months. But why is that so? In this post I will try to lay out the reasons for failure, if you are a new or struggling trader, I'm sure you'll find this useful. Let's get into it ... 🤯 EXPECTATIONS Many start trading because they've seen or read about success stories, people becoming rich overnight, they might even have a friend who has been successful in trading and they think (to say it in Jeremy Clarckson's famous words) "How hard can it be?. With this approach, failure is imminent... 📐 NOT HAVING A PLAN "If you fail to plan, you are planning to fail - Benjamin Franklin . Trading without a plan results almost certainly in failure. Your trading plan should include the definition of your setup, entry, stop loss, profit taking, trade management, risk management and money management. 🔄 NOT TESTING YOUR PLAN OK, you have determined how you will trade, what defines your entries and exits, how much of your capital you will risk and how you will manage your trades. But do you know what is the expectancy of that plan? Do you know how much trades you will win on average, and how many you will lose? How much money can you expect to make? Backtesting your plan, executing it flawlessly time after time on historical data will give you that information and the confidence to execute your plan time and time again without hesitation. 😱 EMOTIONS - THIS IS THE BIG ONE! If did not take the time to create a trading plan and backtest it, you don't really know what you are doing and emotions will have the best of you. Fear, greed, hope, excitement, anxiousness, boredom and frustration will drive your hard earned capital away from you. Results of these emotions are : trading too much, letting your losers run and cutting winners short, revenge trading, overleveraging etc... I could write an entire post about each of the emotions and how they can affect you while trading, but it would make this post too lengthy. Just know that emotions are your biggest enemy when trading, for best results you should be in a stoic state when trading. 🕺 EGO "The market can remain irrational longer than you can remain solvent.". If you want to prove the market that you are right, you are doomed to fail. The market is always right, no matter what happens, so you better learn to accept that your analysis or prediction of what would happen was wrong and cut your losses. Fast! 📚 LACK OF EDUCATION It takes many years to learn a skill or a profession, trading is no different. If you think about making lots of money without putting the time in to learn and test, you pretty much guarantee yourself to fail. You wouldn't want a lawyer without education to defend you in court, or a self-proclaimed surgeon who learned on YouTube to operate on you, would you? 💰 STARTING CAPITAL TOO LOW If you're starting with a low capital, you will tend to try and make it grow fast, resulting in taking too many trades, too high of a risk, too high leverage. If you start with a low capital, you'll have to be OK with the fact that it will grow slowly and that it will take (a lot of) time to build up a sizeable account. 🚦 BUYING OR FOLLOWING SIGNALS "There is no such thing as easy money." You might think that you don't have the time to learn about trading, making and backtesting a trading plan. So why not follow signals? Ask yourself what you know about this service? How profitable is it (and don't just go from the claims they make)? Do you know anything about the reason for a signal, why was it triggered? Have you talked to other users who used the service, what do they think about it? Why is this person/company selling signals if they are so successful as they claim? Philanthropy ? 🤔 📉 INDICATORS OVERLOAD Indicators can help you make decisions for trading, but too many indicators can and will lead to opposite signals or "analysis paralysis. Most indicators are derived from price, so it makes sense to learn how to read price action and discover the story behind the candles. 🆕 THE NEXT SHINY OBJECT SYNDROME You took the time to develop a trading plan and even tested it, but you run into a drawdown... Rather than counting on your experience and the expectancy that you know is there, you look for a new shiny method of trading, until the same thing happens again with this new method ... Rinse & repeat, never giving the chance for your original method, which you know was working when you tested it, to prove its worth ... Alright, I think I have provided the main reasons why new or inexperienced traders fail. Knowing why they (or you) fail is one thing, doing something about it is not a small feat. But with enough dedication, persistance and the right mindset, you can prove these statistics wrong! Feel like reasons are missing, let me know in the comments below. So what is your story? Are you a successful trader now but recognize these reasons for failure? Are you a new trader? Was this helpful? What did/will you do to overcome this? What did/do you struggle most with? Help the TradingView community by commenting below. "Trading is a ruthless business that does not take any hostages, so you better come prepared." - Nico Muselle Liked this post ? "Smash that like button!" 👍 - follow for more educational posts and alerts 🔔 when a new one is published. Thank you for your visit! 🙏
Editors' picks
Education
by Nico.Muselle
40
Potential for GJ to push 30 pips out of if it's sluggish range!Hello Traders! Here I have some nice clean simple GBP/JPY analysis... Overall on the higher timeframes (Daily, 4H) GJ is clearly moving bullish, from this information I am only comfortable taking buys. Strong support formed and identified on the 4H timeframe @144.450. Resistance formed and identified on the 1H timeframe @144.600. In between the identified zones is a range in which GJ has been bouncing off both support @144.450 and resistance @144.600 since NY volume started to scatter. Leading up to the Asian session open GJ has potential to break out of the range it is currently trading within, if I see a bullish candle break and close above 144.600 then I will be confident to take a buy to fill in the previous daily candle wick. Let's see how this plays out 🙌 If you agree with my analysis feel free to leave a like on this post❤ Be sure to follow me to get notifications for when I post my ideas👍
Short
by ShaunGadd02
4
NOK - HOW TO PREVENT FOMO TRADING 1. Ask yourself why you want to invest, is it out of jealousy from others cashing in big? Do you want to be apart of the next big hype stock? If you answer yes to either of these do not trade, trading from this emotional perspective will only result in you losing money. 2. Warren Buffet said ''be greedy when others are fearful and fearful when others are greedy'' apply this logic to your decisions, chances are if the stock has pumped tenfold already and people are still greedy this could be an indicator you shouldn't trade - there are always more opportunities. 3. Ask yourself ''am I a sheep?'' Sheep do not make money in the stock market, do not blindly follow peoples ideas, question them and formulate your own understanding. 4. Where did you see the stock? if it was on the news the ship has sailed and you shouldn't buy it, at this point it is already too late. 5. Be careful of stocks that appear to be pushed by the same groups of people - this indicates little to no adoption and they are hoping that you buy their bags from them. 6. If you can't explain what the company does and why it's a good idea do not buy it. Always do your research first, learn about the team, the product, the vision and financials before investing. 7. If the market is mostly green its time to sell, if the market is mostly red, its time to buy. 8. Is it a meme stock? if yes either be an early adopter or do not buy it. 9. Have you got spare capital? always take into account your financial situation and be prepared to lose - never invest more you are willing to lose. 10. Learn to take losses - otherwise, you will end up holding your bag down a -80% drop. Hope this was useful ''Buy Big Sell BIGGER'' - MegaWhale
NYSE:NOK
by MegaWhale
6
NATURAL GAS – Week 5 – Uptrend to resume?In the previous week, Natural Gas broke the trendline and at the moment it’s consolidating above it, with the bulls not giving up that easy. This will get a bit messy if we don’t gather some momentum for a price increase, as it may unfold into a complex corrective pattern. The market opened with a gap up and the chances that we can go and test the 3$ level are increasing. Trade with care. Best regards, Financial Flagship Disclaimer: The analysis provided is purely informative and it should not be used as financial advice. Remember that you need a plan before you start trading; so, take this knowledge and use it as a guidebook that will ultimately help you understand the market and easily predict your next move.
NLong
by financialflagship
2
Can GBP/JPY rally a further 55 pips? Find out why here...GJ has seen a very strong bullish rally during today's market sessions. High amounts of volatility came into the market due to the Interest Rates set today by the BOE along with a statement by the governor, which is why there was such big movements in the GBP today. Price started a rally from support @142.950 and rallied strongly over 100 pips to the upside testing weekly highs @144.000 when the zone was broken which indicates a very strong potential for GJ to continue moving higher, but due to such a big pump in the market earlier moving over 100 pips I expect the market to range or correct a little before continuing further. GJ is currently sitting in a range in between 144.000 and 144.100 (12 pips), I would like to see a breakout above 144.120 in order for me to be confident in a move further to the upside. If a breakout does happen then there is a high chance for GJ to move towards 144.670 (55 pips). Feel free to like this post if you agree with my analysis! Be sure to follow me for notifications when I post👍
Long
by ShaunGadd02
TEN TIPS TO PREVENT FOMO - WE CAN ALL LEARN FROM THIS!!!1. Ask yourself why you want to invest, is it out of jealousy from others cashing in big? Do you want to be apart of the next big hype stock? If you answer yes to either of these do not trade, trading from this emotional perspective will only result in you losing money. 2. Warren Buffet said ''be greedy when others are fearful and fearful when others are greedy'' apply this logic to your decisions, chances are if the stock has pumped tenfold already and people are still greedy this could be an indicator you shouldn't trade - there are always more opportunities. 3. Ask yourself ''am I a sheep?'' Sheep do not make money in the stock market, do not blindly follow peoples ideas, question them and formulate your own understanding. 4. Where did you see the stock? if it was on the news the ship has sailed and you shouldn't buy it, at this point it is already too late. 5. Be careful of stocks that appear to be pushed by the same groups of people - this indicates little to no adoption and they are hoping that you buy their bags from them. 6. If you can't explain what the company does and why it's a good idea do not buy it. Always do your research first, learn about the team, the product, the vision and financials before investing. 7. If the market is mostly green its time to sell, if the market is mostly red, its time to buy. 8. Is it a meme stock? if yes either be an early adopter or do not buy it. 9. Have you got spare capital? always take into account your financial situation and be prepared to lose - never invest more you are willing to lose. 10. Learn to take losses - otherwise, you will end up holding your bag down a -80% drop. Hope this was usefull ''Buy Big Sell BIGGER'' - MegaWhale
NYSE:GME
by MegaWhale
3
UNI 🚀 [RECAP + TRADE SETUP GUIDE] 160% !! Here is the complete breakdown of the UNISWAP trade. On January 4th UNI made its last critical trend support retest at around 4$. 🔷After a few it was confirmed to continue an upwards channel. That was until we reached the critical $7 resistance cluster. Looking back in September UNI had exploded and saw a massive sell off, (most likely from the free air drop). We had scene small accumulation in this area which marked critical resistance / support ($6.80 - $7.50). 🔷On JAN 16th we closed above this resistance level saw buying activity after confirmation. Usually retail traders will FOMO sell after thinking they have reached the peak. This then caused the price to move back towards critical support levels. Paying attention to the wicks, we can see price had moved down to $6.80 and quickly climbed back up. This indicated heavy demand getting filled (people buying the dips). 🟢 After confirmation of the critical support cluster holding. We can make the predication of making a higher high. 👉It is always BEST to enter your trades after confirmation. In this case we had waited about 6 days to enter the trade. 👉If we had entered at the first break out, most of us would have fallen to FOMO selling. ⭐️ Entry : $8.00 ✅ 160% + Spot gain! ✏️ Current View Looking at the current price, we can see UNI had exploded again closing above its trend resistance. We are currently retesting this level and can see long wicks at the support cluster (high lighted area). The long wicks are indicating demand is getting filled. Remember to make your entries after confirmation of 4H candle holding above $8.20 Hopefully this can help you enter trades strategically with less risk level! Thank you for your time ❤️ Please give this a 👍 if learned something new :) Feel free to view previous analysis and results below ! This is not financial advice. The guide above should only be used for educational purposes.
by BigLava
8
Implementing Heiken Ashi CandlesKEY POINTS: Heikin-Ashi is a candlestick pattern technique that aims to reduce some of the market noise, creating a chart that highlights trend direction better than typical candlestick charts. The downside to Heikin-Ashi is that some price data is lost with averaging, which could affect risk. Long down candles with little upper shadow represent strong selling pressure. Long up candles with small or no lower shadows signal strong buying pressure. ----------------------------------------------------------------- When paired with risk management tools, trading indicators can give you a clear insight into price movements. Heiken Ashi candlesticks resemble a typical Japanese candlestick, but several details differ from the traditional candlestick chart. Every Heiken Ashi candlestick has an upper candlewick, a shadow (lower candlewick) and a body – much like the Japanese candlesticks. However, a bar in the Heiken Ashi starts from the middle of the one before it and not where the previous one closed-a significant distinction. Each candle has a high, low, open and close, and thus the Heiken Ashi formula has four segments.The opening level is the midpoint of the previous bar; the Close of each bar is the average of high, low, open and close. If you’re aiming to catch persistent trends, then Heiken Ashi will be valuable. NOTE: However, day traders who need to exploit quick price moves may find Heikin-Ashi charts are not responsive enough to be useful. Also, due to no price gaps within Heikin-Ashi candlestick charts, risk management is harder to monitor. Using additional methods to watch risk is advised. The formula for calculating Heikin-Ashi candlesticks is as follows: Open= (Open of previous bar+ Close of previous bar)/2 Close = (Open + Close + High + Low)/4 High = the Maximum Price Reached Low = Minimum Price Reached *Hope this helped refresh your knowledge of Heikin-Ashi candlesticks or showed you a new trading strategy to use.
NASDAQ:CLSKEducation
by kingmidasLXIX
1
Descending trianle pattern for NIOHey traders! In 1D timeframe analysis of #NIO we saw correction which is seen in FIbonacci retracemen t.Its holding above 0.5 level.Volume is significantly lower compared with last 2 weeks which also supports healthy correction opposed to huge sellof .Descending triangle in "uptrend" probabilistically is Bullish! I added Fibonacci extensions for my target price 84$ Caution: At this point NIO correction goes on for 22 days after record price of 67$.IF RED volume spikes with decreasing value below (53-54$) 0.5 Fib retracement level, downtrend will be imminent
NYSE:NIO
by lamborghiniFURU