IF YOU Feel Like Giving Up Trading? Here's How to Fix That…
Stop trying to get rich fast
One of the primary reasons so many traders get burnt out and eventually want to give up trading or do actually give up, is simply because they are trying to get rich quick.
Obviously, trying to get rich quickly in trading means you’re probably doing almost everything wrong.
It means you’re probably trading too frequently and risking too much per trade, which are two things that quickly lead to a lot of lost money as well as frustration and mental anguish.
I strongly urge you to change your perspective on trading and stop trying to think you’re going to make a lot of money fast. The ironic and difficult part about trading is that to eventually make a lot of money at it, you must start out slowly and methodically and totally unconcerned about making money.
FINALLY make a trading plan
I know that everyone knows about trading plans and knows they should make one. But, I don’t think most people actually ever make one, which is a huge mistake. Especially, in the beginning, it’s very important you spend time writing out a trading plan and trying to follow it with discipline.
After you learn an effective trading strategy, making yourself boil it down and aggregate it into a comprehensive yet concise plan is something that will help you further understand your method and when you should trade it.
You will also then have a physical / tangible document to guide you and to help eliminate emotional trading mistakes.
You have to stay accountable to your plan. If you break your trading plan rules you essentially are proving to yourself that you don’t have what it takes to be a trader, and to me, that is something I always wanted to avoid. I have always had a trading plan; at first it was a physical one that I read and followed each day, but now, due to my experience and developed skill, it is more of a mental checklist, but I remain disciplined and accountable to it.
Take calculated risks
Here’s an easy way to figure out how much you can risk per trade. Sit down and think about how much money you have that you consider risk capital; money that you can potentially lose in the market. Now, divide that amount by 20 and that is your per-trade or 1R risk amount.
Your risk should be a dollar amount that you could lose 20 times in a row and still be able to take another trade with the same risk.
This will make it so you aren’t risking too much per trade, which in turn, will greatly help you develop and maintain the proper trading mindset.
I promise you that if you get into the habit of risking more than you’re comfortable with losing per trade, you are going to start having some big losses and quickly blow out your account which will lead you to wanting to give up on trading. So, let’s avoid that!
Demo trading is a critical component to getting back your trading passion. If you’ve recently felt burnt out and ready to quit, stop trading live for a while and just go back to demo. Demo trading returns you to a neutral, emotionless mindset, which will help you regain focus and perspective. It also restores the market to more of a competition or a game, rather than just about making money, which is a huge help in getting back your passion.
When you think of trading as a game that you are just trying to play as good as you can, so that you win, you will be in a much more effective frame of mind than if you are just thinking about it from a profits / money perspective
When you are ready to go live again…
When you feel like you want to give live trading a shot again, I recommend you try aiming for smaller wins for a while, maybe 1 to 1 risk rewards up to 1 to 2, to build some confidence and get some wins under your belt.
Once you have some runs on the board and if you’re confident, you can increase risk gradually up to your 1R amount, whilst remembering each trade needs to be carefully planned and shouldn’t exceed your per-determined 1R amount.
Edited 08 Jun 2021, 16:27
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