Basic of trading

Hello, Traders!

The basics of what it takes to be a successful trader are simple and obvious
Yet daily, I see traders who fail at one or multiple KEY points that sink their performance and they keep losing accounts even though these people do have the understanding of the market that would have been sufficient enough for them to be profitable if they followed the basic rules. Trading is as much about pattern recognition and capacity for abstract thinking as it is about the personality type, self-discipline, and specific mindset.
The lucky few are born fit for trading, but others might train themselves.
Below, is the breakdown of the basics behind the day trading!

✅TRADING IS A BUSINESS NOT GAMBLING
99% of the new traders have unrealistic expectations of the kind of returns trading might deliver. To make matters worse, they do not realize that it will take years of trial and error before they can make trading Their only source of income.
These delusions make the newbies treat trading like gambling. To AVOID this, please follow these 4 easy steps:

🔥SET AND KEEP YOUR RISK-REWARD.
I recommend risking no more than 1% of the deposit per each trade, which also implies using a variable lot size for every trade, so that no matter the SL
size in pips, or the pair you are trading, the dollar value of the RIKS remains the same with each trade. That way, you are in full control of the risks you
are taking.

🔥DO NOT GO ALL IN.
Sounds obvious, but I’ve seen it so many times. New traders, who lost 70% of the account, GO ALL IN on one trade that they think might help them
recover the balance. That is NEITHER a way to trade, nor a way to learn. Slowly losing your account while learning how to trade, is simply a fee that you
are paying the market for your education. Accept it or fail.

🔥PROTECT CAPITAL=USE SL
I can’t stress this enough and I BEG YOU to use SL. Do NOT enter the trade thinking that if the SL level that you had in mind is hit you will close
manually. You will NOT close the position, and the longer you hold it the more is the temptation to wait a bit more because it seems that the reversal is
coming soon.

🔥CUT LOSSES
Set a daily loss limit. For example, you can Ban yourself from trading for the rest of the day if you lost more than 3 trades in a row. You will enter what
is called a tilt most likely, and you will NOT be productive that day. The same goes for a week. Lost more than 10% of the account in a week? Next week
NO TRADING for you. Watch the market passively, or trade on the demo! By the way, That can be helpful even for professional traders too!

✅KEEPING A COOL HEAD IS KEY
The ideal trader is the one who can set all emotions aside as a robot would, while simultaneously keeping the versatility of the human mind and the intuition, that the machines lack(yet). It is of utmost importance for the new traders to understand that being right about the direction but entering too early or too late is the same as being WRONG because the result will be a LOSS.
Here is how to keep cool:

🔥CONTROL YOUR EMOTIONS.
Both euphoria and a panic attack are your enemies so the more detached you are, the better. Emotions are for the casino, and we are doing business
here, remember?

🔥AVOID FOMO( FEAR OF MISSING OUT)
That one applies mostly to the trades that you are not so sure about, but still want to take them, in fear of not making money. And the early entries are
determined by FOMO too( what if the price does not reach my limit order, and the trade plays out well, but without ME?)
FOMO is Incredibly counterproductive, don't let it control you!

🔥DON’T FOLLOW OTHERS
Avoid herd mentality! 99% of traders lose money, so doing what everyone does inevitably lands you in the 99% category.

🔥BUILD A WATCH LIST
A LOT of the beginners try to PREDICT behavior of the particular instrument that they decided to trade for some reason, instead of going through the
pairs looking for a ready setup that you KNOW works. The former approach leads to finding patterns, key levels, and setups that just aren’t there.
Naturally, the result of trading these is an inevitable LOSS.You should Build a watchlist big enough for your to have a choice, and go through it at
regular intervals, looking for opportunities but NOT INVENTING them.

✅ CONSISTENCY OVER BOOM-BUST STYLE
Consistent trading is the only way to make trading a reliable source of income. Slow but steady gains always beat leap-like boom-bust performance.
The psychological pressure of the latter will most likely break you sooner or later, and who needs gray hair in their 30es anyway?
That is how you achieve consistency:


🔥FIND A STRATEGY
Do the research on multiple trading strategies and pick those that you understand and that are compatible with your personality.


🔥USE PAPER TRADING AND BACKTESTING
To select which strategy is right for you, use backtesting to see how the strategy performed in the past. And use paper trading to see how the strategy
works in real-time.Once you chose the strategy, go back to paper trading and backtesting to polish it.


🔥TRACK YOUR TRADES
Keeping track of your trading! Working with that data is an invaluable tule for the trader, that helps identify your strengths and weaknesses, while also
helping you notice patterns in your trading that would have been left unrecognized otherwise.


🔥FORMALIZE YOUR RULES
Objectivity is KEY for consistent trading because during the rough patches of the market, being sure of your rules helps you stay in the market, waiting
for the tailwind, instead of questioning your strategy or your implementation of it. Create a strict ALGORITHM and follow it step by step. In order to do
that, you need to define every element of your strategy as precisely as possible. For example, a level for you is a daily horizontal level with at least 3
touchpoints, a breakout is valid only if the 4H candle closed above the level, etc...
The less vague the terms, the fewer emotions will be involved in deciding whether to enter the trade or not.


❗️IN CONCLUSION: If you want to become a trader, remember:

1- It will take YEARS to learn how to trade.
2- You will lose a TON of money in the process
3- You will FAIL with 95% probability.
4-Realistic returns from trading are WAY lower than you think
5-BUT when you succeed, you will set yourself free! 

 #OPINIONLEADER#  #ForexEducation#  #BeginnerTalk#