There are many trading principles that are common among successful rich traders. It is important to learn the things that allow them to win so we can follow in their footsteps and make money. There are 10 things that new traders can start doing tomorrow to improve their results immediately. If you have been trading for awhile but have not been profitable these may be things that you need to start doing to stop losing money.
1. Start trading the price action by using charts. The market doesn’t care about your opinions but the chart expresses the collective actions of all market participants. Learn to understand what the chart is saying.
Start to understand that the market determines whether any single trade wins or loses not you and not an imaginary “they”.
2. We can only surf the price waves not control them.
Start to take 100% responsibility for your losses.
3. You enter the trade, you exit the trade, the wins and losses are yours alone. The blame game is a losing game in the markets.
Start to bounce back from losing trades quickly, move on don’t ruminate.
4. If your position size and risk management are correct no one losing trade should emotionally devastate you it should be only one of the next hundred trades with little significance by itself.
Start caring more about what the market is doing and less about what you think it should be doing.
5. ALL that really matters is current price action not your opinion of what might be price action later.
Start to change your position quickly when you are proven wrong in a trade.
6. The best trades start out as winners immediately, when you have to start hoping and stressing early it is very probable that the trade will be a loser.
Start to have a positive expectation of your robust method for long term success regardless of your short term results.
7. Traders that make money are able to trade through their losing streaks with small losses to get to the big wins.
Start to define trading success by trading a robust method with discipline over the long term.
8. Consistently trading a winning system over the long term is what makes money in the market.
9. Start to only risk 1% of your capital per trade.
When you risk only 1% of your capital per trade you turn down the volume of your emotions while trading and decrease your risk of ruin to almost zero. This 1% refers to the amount of loss you will take not on your total position size of capital in a trade.
10. Start to cut your losers short and let your winners run.
The primary thing that makes money for most rich traders is having small losses and big wins not percentage of winning trades.
If what you are doing is not making you money in the long term then why not stop doing what you are doing and start doing what the money makers are doing?
Bad traders make a little money in the short term but lose big money in the long term. Rich traders lose a little money in the short term but make big money in the long term.
