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3 Ways Traders Can Prepare For SuccessComing into trading with only the desire to make money, often results in not making any. I didn't make a dime for 4 years till my lucky day came. Before it, like most traders, I gambled my way into the game with little to no knowledge. I started off with free information. (Youtube and Babypips were my buddies.) After gathering data from them for 2 weeks, I felt I'm ready, then funded my first trading account. Luckily, I doubled the account on my first day but blew it the next. It was awful but I repeated the process for 3 months till I gave up. However, I got back a month later. Because I was still hooked by the idea of making money wherever I am. Though at the same time feeling stressed, anxious, and depressed to see my hopes and dreams out of reach, I had faith. That I carried with me throughout the years, until one day, I found out what was holding me back: a short-term mindset. Which is what I'll show you how to escape from before it's too late. **Thus Begin By Thinking In Years Than Months** Ignoring this advice will be costly. It will cost you your time, money, and mental health. You don't want that. But you get that by being a short-term thinker. Which is a person who focuses on the now, with little regard for the future. Someone who focuses on short-term results at the expense of long-term interests. A trader who focuses on making money instead of focusing on the 3 stages of becoming a trader: 1. Learning to trade. 2. Becoming a trader. 3. Full-time (profitable) trader. It's almost impossible to reach stage 3. Yet it is possible when you begin the journey like a long-term thinker. Which is a trader who envisions, plans, and works toward the future. While ignoring the monetary side to focus on the skill (that will serve you till you meet bro, Jesus). Like what all medical students do. From the get-go, they know it will take them 6-7 years to become professional doctors. Being aware of this allows them to focus on the stages of becoming doctors. (But lucky for them, they make money along the way through student loans.) So, coming into trading with an idea that it will likely take you 5 years to become a consistently profitable trader, will assure that. Because it will keep you grounded, focused, consistent, and patient with the process. And that will allow you to enjoy it while growing fast. With that said, let me show you how you to prepare for trading success below: 1. Create a long-term vision. A clear vision with a plan will save you from falling into traps that will delay your progress. It will allow you to navigate through the dark cave till you reach the light. But that's only possible when you have a torch and a compass. Powerful questions and a plan of action. Questions help you to discover the path. A plan helps you walk the path. Thus to find out if trading is the right path, ask yourself: - Why do I want to become a trader? I know you are in it for the money (like I used to be), but that mindset will prevent you from getting it. So take your time answering this question. Don't rush because whatever answer you get will determine your success or failure! Once you're satisfied with your answer, start planning out your journey by... 2. Setting Objectives In simple terms, an objective is a measurable step you take to achieve a vision. For a trader who's in the first stage of "learning to trade" while working a 9-5 job, the vision could be to become a full time professional trader. And the objective could be to buy a trading course from a mentor you perceive as legit, then study and practice till you reach the 3rd level. To discover that objective, the reason behind it, and how to achieve it, you need to ask yourself: - What do you need to do? - Why do you need to do it? - How you’re going to do it? After figuring out all that, move on to the next step, which is... 3. Keeping your job Do not quit your job before becoming a profitable trader. It will save you from unnecessary mental and emotional pain that are caused by forcing profitable trades to pay bills. That’s a bad approach to trading. It always delivers opposite results that will definitely make you stressed, anxious, depressed, and unsuccessful. You need not worry about money along your journey, so you can focus on the process of becoming an elite trader. I’ve made that mistake and it cost me too damn much. So, keep your job to save up at least 2 years of monthly expenses that will get covered once you’ve decided to become a full time trader, and save for a 6 to 7-figure prop firm trading account to manage once you’ve resigned from your job. Follow the above steps and witness the fruits of being a long-term thinker who focuses on the processes instead of results.
Education
by Doji-2k1
3
MOST IMPORTANT TRADE LESSONS!Lesson 9 Trading Psychology is Important When you look at the market you should see your self. The market is a collection of buyers and sellers. You are a participant in that marketplace, and therefore you are the market. How can you understand the market without understanding yourself? The mental landscape of a trader is extremely important and very valuable to a profitable trader. Those that do not understand this, are likely not making money in the market. Most people wanting to be traders never stop to consider this, and they think it is more knowledge about markets they need to make money. Most of the time it is what is going on in their mind that needs work. If you think you are going to wake up one day and be a profitable trader without working on your self, you are mistaken. If you think you are going to read a few books or watch 100 videos on trading and walk into the market the following week and make money, the traders who know the value of internal work will thank you for your money! Of course you must first understand markets, price action, the traders equation, and how to read a chart. But after that you must move on and dive into your trading psychology . It is not understanding markets that brings money into your account. It is your understanding of your perceptions of the market, awareness of your internal dialogue, thoughts, and emotions, along with your knowledge of the market. Ultimately it is your actions that are generated from these that dictate whether or not you will make money. If you do not understand what is happening within your mind at any given time, you are unlikely to achieve consistency long term. Sure you may pick a few good trades. Anyone can find themselves in a winning trade, even those who know nothing about markets. But will they continue to perform well over a month or a year? It is very unlikely. Trading psychology is vital to trading, whether you choose to accept it or not. The market is a paradox, a contradiction. If your mind is tied up and you are unaware, you will make poor actions in the market. Your mind must be free. Free to flow with the market, regardless of what you want or expected. You must be able to bring your mind back to the market and the necessary action right now. If not, you will be stuck within thoughts of what happened 5 minutes ago, or held by anger and frustration for what the market should be doing. If you do not devote time to understanding your mental landscape you will never grow, and never escape the mental turmoil which the market can cause, no matter how much time you devote to understanding what markets do.. For more information on how to develop this awareness or understand your self on a deeper level, see trading psychology. Lesson 10 Allow for windfall profits Many traders believe they must hold for a reward of twice their risk or believe they have high probability and so exit at one times the risk before the market takes it back. These concepts and ideas are more likely to hurt your performance than benefit it. The truth is, the market offers what it offers, and that's it. Sure sometimes its exactly 1x the risk or twice the risk. Other times it is much more. Cutting a winning trade just because it is reasonable, does not make it the best choice. In fact, when you are in a position with exceptional follow through, you must allow it to flourish. In other words, you must allow it to grow into a windfall profit. It only takes 1 out of 10 of these types of trades to create a positive net result. If you cut this 1 trade short because the market has gone to twice your risk, you are only hurting yourself and your numbers. This is like cutting a flower when it is just starting to bud. You do not allow the flower to bloom , and prevent the beauty which will soon appear. Instead you must nourish the plant, give it water, and allow it to grow into what it can be. Cutting a winning trade short is a self inflicted wound. This is often due to fear such as fear of a reversal, or fear of giving back profits. Thoughts of getting back what you previously lost, or hanging on to what you have right now is what leads to these poor actions. Being unwilling to allow for a pullback against the position which is necessary to allow it to grow. So how do you know when to hold and when to exit? That takes experience. What is important is your willingness to learn, and openness to allow a great trade to flourish. However there are signs which can help you identify which trades are likely to turn into a windfall profit, and those that you should take what the market offers you. For clarity and more information on this see Investing Guide. *If you find this analysis helpful please like! Feel free to comment or ask questions.
COINBASE:BTCUSDEducation
by tradersmentality
Overcoming Emotions and Zen TradingOvercoming Emotions Most traders want to "overcome" their emotions. They view thoughts and emotions as the enemy which prevents them from succeeding in the market. This is a false perception. Yes emotions and thoughts can lead to actions in the market, but they are impossible to remove. So long as you are human you will have emotions and thoughts. There is an alternative to removing them, and that is to use them to your advantage in the market. By practicing mindfulness, which is awareness of thoughts, emotions, and perceptions, you can learn to recognize how these affect your trading performance. By recognizing and being aware of them, you have a chance to change the outcome. For instance if you consistently enter poor trades due to fear of missing out. When you become aware of this fear you can learn to stop yourself from entering and avoid the poor trades that hurt your performance. There is a direct correlation between how you feel about yourself or the market, and how you perform. If you are worried about money you will overly focus on risk or prices going against your position even if only slightly, and likely make a mistake by exiting too soon. Or you do not want to take the loss and will hold the trade too long, hoping the market will let you off the hook with a smaller loss. What is Zen Trading about? Zen trading is a mindset of flowing with the market without hesitation, being aware of and trading along side emotions, and making actions intuitively rather than forcefully. A Zen trader remains in a relaxed, effortless state of mind; without any internal struggle. He does not attach his self worth to his performance at any given time, and is unhindered by market outcomes. He acts on his edge when it is present without hesitating, and takes what the market gives him when it is time to do so. He trusts himself, his strategy, and the market to provide him with a consistent performance over time; whether or not he makes money on this trade, today, or this week. He is aware of the bigger picture; the Tao or life, and knows there is more to life than trading or money. Trading is not his life. It is simply something he does to earn a living, and he seeks to maintain a Zen spirit in his trading and actions in the market. *If you find this analysis helpful please like! Feel free to comment or ask questions.
COINBASE:BTCUSDEducation
by tradersmentality
Lessons from an Experienced Trader Lessons from an experienced trader. Lesson 1. Never scalp. Although scalping seems to be the most profitable and best method in today's market, it is certainly not. Scalping is the hardest method to achieve a consistent performance. High frequency trading firms scalp, but they have many advantages over the retail trader including direct access to exchanges, highly developed algorithms with no emotions, and extremely low costs to name a few. When you are scalping you are competing against these firms or trying to manually do what they do with a computer. This above is only one problem. The bigger issue is the risk involved. When scalping, you must use a wide stop and be willing to scale in. One bad trade will erase 20 or more good trades. You must be extremely proficient at reading price charts, and be able to act without hesitation. This is virtually impossible for anyone who has not been trading for at least 3 years and has done extensive work on himself to develop the ability to flow with the market, constantly, without any internal conflict. And worst of all, scalping leads to bad habits. Once you get into the mindset of "get out quick" it is very hard to correct down the road. This makes swing trading more difficult later on after you realize it is a better method. Lesson 2. Swing Trade the best setups Swing trading is much more forgiving than scalping, offers a larger reward, and allows for a smaller risk (usually). This makes it much easier to make money long term. When swing trading you only have to win on around 40% of your trades to make a profit. If you can develop the patience to wait for strong setups, you can increase the winning percentage to anywhere from 50-70% and greatly increase your traders equation. A swing trading approach is also more forgiving when it comes to reading price charts. Some of those who discuss Price Action would lead you to believe you can predict what the markets are going to do next. This is simply not true, no matter how good you are at reading a chart. There is always a degree of randomness in the market, with any edge, any setup, or any context. When swing trading, you can afford to be wrong and make mistakes. So what setups should a swing trader take? Well, it depends if you want to always in trade or swing trade with signal bar stops. Either is fine, although an always in approach takes more practice and is harder to get right until you are good at reading charts. An always in trader has two choices. One to take every logical reversal (hardest to accomplish), and constantly reverse when necessary. Or two; wait for the always in direction to be clear and enter any in any fashion until the market flips. The second method is easier, although still tough, and slightly less profitable. An always in trader does not trade when prices are in a trading range. The reward is simply too low, and there are too many reversals to take and that fail, resulting in repeated losses and increased commission costs. What about a swing trader? A swing trader typically uses a signal bar stop, but can also use a swing stop to increase his probability. A swing trader does not have to take every trade he sees (unlike the first always in trader). In fact, it is best to wait for the best and clearest setups. What setups are these? High 2's, Low 2's (large) reversals and flags, Wedge reversals and flags, failed breakouts, and failed reversals. The first two are much easier to identify correctly for someone with less experience. The later two often trick newer traders, or fail once or twice before succeeding, making it a bit harder to get right. Lesson 3. Work on your self Like discussed before, most new traders and even those who have been around but haven't reached consistency believe that eventually you can read prices well enough to predict what will happen next. It does not matter how long you have traded, you will never predict the market. If it were possible to do so, the market would cease to exist! So instead of only focusing on reading charts and price action, you must work on your self. You must understand your strengths and weaknesses. You must be aware of your emotions and how they affect your performance. If you do not believe your emotions are directly related to your performance, you will not achieve consistency long term. We are all humans, a computer cannot do what I do. And you cannot remove emotions, no matter how hard you try to do so. So what is the alternative? Develop awareness of them, and use them to your advantage! It is as plain and simple as this. Trading requires you to understand your self, on a deep and internal level. You must be in tune with your self and the market. If you chose to ignore this fact, you may succeed temporarily, but it is only a matter of time before your performance diminishes. In order to make a lot of money, you must feel you deserve it. If you do not work on yourself, this simply will not happen. Does a professional athlete become a star by waiting around for his coach to tell him what to do? No. He dedicates himself in every possible way to his sport, including conditioning his mind to outperform his competition. Rather than waiting 2 or 3 years before realizing this, start working on your self from the very beginning. Not only will you become a better trader faster, you will become a better person; a better you.
AEducation
by tradersmentality
4