On this Labor Day when many are off work for a paid holiday I am working, looking at charts, planning, thinking and reading. Pondering what Tuesday trading may bring. Trading is NOT the path to easy money nor free money. Trading is work and a profession like any other, traders and investors will only get out of the markets what they put into it through diligent work. Even the luck of easy money in a bull market trend will be taken back rather quickly in a bear market and trend reversal if the trader or investor does not understand the art of the exit using trailing stops and stop losses. Huge gains acquired through big risky trades will be taken back just as quickly with a string of big losses.The irony is that profits taken from the markets may be the hardest money to make and to keep. Trading is one of the few professions or hobbies where you can work 50 hours in a week and lose thousands of dollars for your effort. It is also one of the few places where you can make enough money in just a few years to pay off your house. It is a game worth playing but you better do the work or the traders on the other side of your trades will work you over.
10 Ways to Labor Towards Trading Success
- Study charts, study the trends, and the monster stocks. Look at how prices have reacted to moving averages on your favorite trading vehicles.
- Study the trading careers of the greatest traders who ever lived.
- Learn how the Market Wizards trade.
- Use social media to ask great traders questions for some quick clarification on questions.
- Find a mentor if you need one.
- Learn how to manage risk properly in your trading. You must understand the risk of ruin.
- Do the research needed to acquire a robust trading method with a great risk/reward ratio.
- The best lessons are learned in live trading with real losses. If you are a new trader, trading a very small account will give you great lessons.
- Learn how to determine if a market is in an uptrend or downtrend, bear market or bull market.
- Do the work to learn how to manage your emotions, mind, and ego while trading.