Day Trader Success Guide - 6 Step Process For Beginners
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The document outlines a methodology for successful day trading, emphasizing the importance of risk management and psychological discipline over the trading setup itself. It comprises several stages, starting from understanding personal motivations to committing to practice, simulating trades, and eventually moving to live trading while continually monitoring and adjusting one’s strategy. The focus is on building consistency through mistake-free trades and learning from losses.
Day Trader Success Guide - 6 Step Process For Beginners
- 4. Your broker will offer freebies as part of your business relationship with them
- 6. Method used to find trading setups is the least important variable of all
- 7. Risk management and psychology are their biggest assets
- 9. TAKE ACTION
- 10. STAGE 1: FIGURE OUT YOUR REASONS FOR WANTING TO DAY TRADE
- 12. By not losing the forest among the trees
- 13. ONE TRADE Is meaningless Unless you used horrible risk parameters
- 14. Learn to take internal ownership of the trading methodology
- 16. You will not trust your edge and will intervene in a trade (based on emotions)
- 18. STAGE 2 - ACCEPT HOW YOU MAKE MONEY TRADING
- 19. Why?
- 20. You must have faith that you've seen an edge in your system
- 22. Most Consecutive Losses Largest Draw Down Period
- 24. You should be thinking, "Wow! This really does work."
- 25. You are beginning to accept.
- 26. You are beginning to believe.
- 27. You are beginning to take internal ownership of the system
- 28. Rome wasn't built in a day
- 30. STAGE 3 - PRACTICE MAKES PERFECT FOR BEGINNERS
- 32. You are reinforcing & perfecting your knowledge of your trading rules
- 33. Sim trade for a few weeks
- 34. This is the time you will feel you are ready to start trading with your live account. Not Yet
- 36. Commit to taking 25 consecutive mistake-free trades in your sim account
- 37. A mistake can be anything including:
- 38. Execution errors 2 nd guessing
- 39. Moving your stops and targets outside of your plan Missing an entry
- 40. Not adjusting around a key level, etc.
- 41. We call this the "Power of Quitting“ www.slideshare.net/NetpicksTrading/trades-should-quit
- 43. STAGE 5 - IT'S TIME TO START DAY TRADING LIVE
- 45. We make money based on the edge of our system
- 46. Losing trades and money is part of getting back on the winning side
- 47. You've seen that emotions play a huge part in trading
- 48. Lean on your system and take your trades, because that IS the only way to continually make money trading
- 49. 25 mistake-free trades is a stepping stone to consistency!
- 50. This is real money now
- 51. STAGE 6 - MONITOR TRADE STATISTICS AND TWEAK YOUR TRADING PLAN
- 52. Establish prior day's ending balance and use that to determine what a 2% risk is
- 54. Back test other markets and time frames
- 55. We need to keep a higher perspective by not focusing on just one or two trades
- 57. We MUST sacrifice 1/3 of all of our trades to get to the 2/3rds that satisfy our reason for trading.
- 58. Losing? Take a step back. Re-evaluate. Go back to Stage 1.