There must be a magic formula out there that means you will win at day trading every time you do it. There must be. There just has to be. Because if there wasn’t, how could people become profitable full-time traders? How could they just ‘work’ for a few minutes each day and still come out on top?
It has to be that secret success formula that, once known, will make you a millionaire overnight.
Right? Wrong. So very, very wrong. This formula, we’re sorry to break it to you, does not exist. And if you want to win at trading, you have to learn how to lose.
Yes! Yes, it is! Learning to lose is not generally the ideal way to learn how to win, but when it comes to price action trading, it’s exactly what you need to do. Since it is impossible to win at trading one hundred percent of the time, knowing what to do if (when!) you have a losing trade is imperative.
And the reason you can’t win at trading every single time? It’s because the figures and the momentum of the markets are all to do with people (and their supply and demand) and people are, by their very nature, absolutely and entirely unpredictable. Because we can’t presume to know what one trader is or is not going to do, and since what they do has a potential impact on the market, by extension was cannot and will not and do not know what the trade that we just put on will do. Not for sure. We can have a good idea, and have good charts that will help matters, but in the end, it cannot be predicted. Try predicting cryptocurrency trading!
Trading the same way each time is pretty much what you should be doing if you are using your charts. And perhaps most of the time you’ll come away with a win at trading. But not every time. Because something may happen that affects the market in a way that could not have been foreseen.
This is why learning how to win at trading includes learning how to lose at trading. You need to know how much money you are willing to lose. If you win, congratulations, but if you do lose then you know you are still in the game. In other words, you haven’t blown your life savings on one trade that went wrong.
When you win at trading you will feel on top of the world. Invincible. As though you’re about to strike it rich. Conversely, when you lose at trading you feel as though the world is ending, as though you can never trade again. Both of these extremes of feeling are false. You are not invincible – a loss can come at any time – and you should not give up – a win could be just around the corner.
What you should do in each case is learn from what happened, win or lose. This is especially important if you lost. Take a look at your charts and make sure they are actually correct. If that means taking some time away from actually trading and poring over those charts until you are completely satisfied then do it. It will be worth it when you start to win at trading. If there are mistakes, fix them. Try again. Little by little you will start to see more wins than losses, and although the losses will still come, you can protect yourself from them as much as possible by knowing exactly what to do next.
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