Trading is based on 4 things:
1- Events or News
2- Technical Analysis
3- Money Management
4- Trader Discipline (sometimes called psychology)
If you do not get the above established you will not survive. Trading is a risky business and it requires a strong disciplined approach. If you do not have it you will fail and it will be miserable and every trader has had their share of it! Wise is one who has experience but someone who is wiser uses the experience of others so that they do not share the same grief.
This is the reason for this article.
If you want to trade you have to establish all four legs! This will make you stable and consistent. Due to the fact that many “want to be traders” focus on the money they dream about making instead of being realistic and planning a career path for consistent rational gains in the market.
This lack of focus and airy fairy attitude is the only reason they fail. They lack the below:
1- The right attitude
2- Clear starting point
If you want to trade for a living and you have not started correctly and established a strong frame work as outlined with the above principles you will not be successful in trading! It is as easy as that.
1- Think long term!
2- Start with education and make sure they teach you on the job under live market conditions.
3- Ensure you have ongoing support so that you can build consistency and establish good habits and get rid of bad habits.
The GlobalTrader.Club approach covers all of these so that the person can start with the right foot and end up being independent.
Most people who want to be traders are simply not serious. They are just chasing some dream and they will not be successful. I can see this from the questions I get asked on Quora website.
Trading requires education and brains with live market experience. If you are not willing to invest in educating yourself you might as well forget it!
Money Management is something that often does not get addressed because everyone is focused on where and when to buy. However, trading is actually managing money. Before you actually enter a trade you must know where you are going to get out if things go wrong! This is also a psychological issue and every trader has issues with this and it must somehow be overcome!
If you do not understand risk return calculations and lot size management, if you do not understand where to put your stop loss or targets, where to enter the trade and how to manage it once you are in the trade, then you are just going to blow your account.
Trading is a profession and if you want to be successful treat it like a career.