What kind of trader do you want to be is an important question to start with. Play around with different styles for a while. Read about the different types of trading, watch videos on Youtube and listen to a ton of podcasts. Try to find what clicks with you. Once you have figured out if you want to be a Long term investor, Swing trader, day trader or maybe even a combination, get your expectations and believes inline. What kind of returns can you expect from the style you have chosen and be realistic about it. Does it fit your personality? Unrealistic expectations and believes will only get you frustrated, and this will snowball into bad choices in your trading.
Find a trader or multiple that are trading how you would like to and have already mastered what you want to master. Now study them! Reverse engineer their trades what are they looking for? How do they enter a trade, how do they exit a trade? How big % off account do they put in? What % off their account do they risk?
My friend Scott from V traders, and he puts a lot of work into posting everything he knows into his discord, not that he is finished learning, we never are. But a lot of the guys and girls in this room are probably in there because they admire how consistent Scott has become. If you want to trade like him actually do an effort to trade like him read all his posts, go over all his charts and watch lists, once you are confident you get what he is looking for after many hours of studying. Copy what he is doing, kick your ego out the door that wants to get credit because he had some sick trade. Or go big on a single trade because you want that big profit. Stop trying to reinvent the wheel or be creative with your trading system. When he makes his watchlist and game plan in the morning and posts it in daily-watchlist so should you! When he is risking 1% per trade, why would you go risk 5% on a trade when you are not consistence yet? He never lets his loser get bigger than what he has planned for, so why would you? When he is right on a trade he lets his winners run, so why should you take profit so soon and be focused on the money? When he is adding to his winners or reupped his risk on his trade, why should you take the trade off the table already? Those things are not only trading skill but also a belief in the system, getting out of your trade when your wrong is only 1 click away, so the technical are not hard, the mental part aka the belief part is the hard part. And to get the right believes, one needs to study to gain confidence in a certain style of trading. So find a trader where you look up to and learn everything you can about them!
I recently have transitioned to swing trading for around 75% of my trading, I have not been creative about this at all there were many great minds before me that have put a decade of work into this and have shared their work, I have watched countless videos about this trading style read many books and studied successful swing traders just to name a few :Dan Zanger, Mark Minervini, Kristjan Kullamagi, Pradeep Bonde, Jesse Livermore, Nicolas Darvas, Rober W. Wilson and Paul Tudor Jones. I made a big Evernote database where I went back over hundreds of charts to find the setups they were talking about. After a while you will know exactly what to look for and know what you could expect from the trade, you will gain confidence in a system and this will make executing it well a lot more easy.
If you are not consistent yet and are losing money, go look for what you are doing different from the guys you really look up to and want to be like. There are many ways to make this work, If you want to make money look around. Look at the 90%. Why do the 90% run their losses? Because its easy to do. Why do the 90% take their profits so soon? Because its easy to do. Why do 90% bet more when they are losing? Because they are not in control of their emotion. They want their money back. Why do the 90% bet less when they are winning? Because they are not in control of their emotion. They protect what they have made.
No need to be a rocket scientist and figure out the next best setup! Or do it differently from the people that have done this before you.
You want to make money? Then you need to look around. Look at the 90%. Why do the 90% run their losses? Because it is easy to do. Why do the 90% take their profit so soon? Because it is easy to do. Why do the 90% bet more when they are losing? Because they are not in control of their emotion. They want their money back. Why do the 90% bet less when they are winning? Because they are not in control of their emotion. They protect what they have made.
Good luck in your study and journey!
Hey Bastian, thanks for writing these blogs, I mostly day trade, but I’d love to swing trade more in the future, now is definitely not the right market to do so (yes I’ve been burnt trying… but hey, sometimes that’s how we learn what doesn’t work) I’ve been following Kristjan Qullamaggie and studying his approach, something that I learned from him and Pradeep is the way of studying and tracking setups, even if it seems like a straightforward approach, I always found studying hard, not because of being lazy but mostly because I didn’t know how to productively study, I have tracked patterns in Excel and actually that helps quite alot, it helps with confidence and even better with losses, anyway I don’t want to make this too long. I just wanted to show appreciation and wanted to say good luck! We all have struggling moments, we all have periods were we feel indestructible and I think, this way of studying helps in “balancing” those periods.
Thanks for taking your time for your kind words! Keep up the good work! Sounds like you are on the right track, even when you feel like some of your study work feels hard or maybe even useless I am sure that it will all be worth your time in the end!
Good luck!