By Rob Colville on May 30, 2017 in
There is a little known fact when it comes to trading – anyone can do it. And, as a bonus, anyone can be successful. But if you want to win at trading, you need to understand how it all works. Or at least how it can work for you.
What on earth that that mean? Well, change the word ‘fake’ to ‘invisible’ or ‘imagined’ and you might have more of an idea. You could be staring at your trading chart for hours and still not see something that will work for you. And that’s fine. It’s also a waste of time. Take a quick look and if there is nothing there walk away and try again another day. In order to win at trading, you need to ignore everything except trades that work for your chart. Don’t try to make them up, don’t try to pull them out of thin air, don’t look for things that aren’t there. You might be keen to trade, but there is no point in trading on something that won’t let you win.
If you want to win at trading, the golden rule is not to play with more than you can afford to lose. But for most people that means that you shouldn’t trade with more than you’ve got in the bank, or more than, if you do lose, would affect you adversely for the rest of the month – or longer. However, it also means something else. It also means that you must not lose any more money than you can mentally manage. You might be able to physically afford to lose hundreds or thousands at a time, but what will that do to your mental state? It’s worth considering.
You look after your health, you look after your home and your family, but do you look after your trading in the same way? No? Then you won’t win at trading. When it comes to being a successful trader, you need to do it in a healthy kind of way, and only trade when it all makes sense. That’s why day trading should be avoided. Day trading is basically over trading, and over trading is a sure fire way to lose and lose again and lose big. It can be tempting, especially if your chart isn’t lining up with anything, but it’s almost never a good idea. This is where traders end up losing money when they really didn’t have to. Be patient. Good trades are just around the corner.
Having the right mindset is one of the first things you need if you want to win at trading. What is that mindset? It’s one of really not caring about winning or losing. It may sound cold, it may even sound harsh, but it’s true. If you care one way or the other, you’ll soon lose your confidence and then you’ll stop trading. If you are all about the trade and if you win that’s a bonus, you’ll trade more – and you’ll trade better because you won’t rush into anything.