Resurrect Your Trading Dream (and Account)
I have seen it so many times, you make a bit and then burn a lot more. Then once you have burnt a bit more and made a lot less you throw the towel in. If this sounds familiar I can 100% tell you that you are not alone! Many traders have been in exactly the same position as you along their journey, although they don't always tell you this. What will make you different from the rest of the 97%, who have tried trading and failed, is if you are willing to except help.
1. Take a Good Look at Yourself
How have you been trading? Have you been gambling, increasing the risk on each trade or experimenting with various strategies? Have you even got a trading strategy? I see many people blow their accounts because they are always looking for the Holy Grail, give that a week and then go searching for another one. You need to choose one strategy that you have seen working for others and then back test it, write down what makes a high-probability trade and stick to it.
2. Trading Plan
I know I mention this in almost every blog but your trading plan is important. It will cover everything from risk management to the time in the market in which you intend to trade. It is an essential tool for measuring your performance and whether or not you are obeying your rules. Clearly write down where your exits will be, what your risk strategy is, what circumstances will result in you coming out of the trade or taking profits. You can update you trading plan periodically to reflect on certain observations you have made. Any loses are only to be seen as a business expense without any emotion attached.
If you read the last blog you will have already started to keep a diary of all the reasons why you trade each trade - visit 'Getting Organised' if you haven't. This covers areas such as do you have a trading plan, the importance of back testing and getting your psychology right.
3. Count Percentages not Pounds
Focus on being professional and executing your trades with provision and lack of emotion. Don't continuously focus on how much money you are making but the amount of percentage that a trade makes. Monitoring your success will go hand in hand with keeping up to date records in your trading plan.
4. Education and research
Look closely at your trading education. Did you just read up on online tips or did you study well reviewed books, attend a course and practise with a demo account with 1% risk? If you didn't do any of the above then I would suggest starting all over again, read up on reviews of courses and take one. Although courses are the best and easiest way to learn you can also learn from books if you can't afford a course.
Set up a demo account, most brokerages offer them and then practise everything you have learnt until you feel ready to go live (again). Also do research into the brokers you are trading with and compare them to others. For example how quickly are you stopped out, how tight are the spreads and are you charged commission on top of this?
5. Join a Trading Community
It is so essential to trade with others. Not only because you can learn from their experiences and trading ideas but to prevent the loneliness of working by yourself for hours on end. Nothing is more deadly for your trading account than sitting by yourself all day with nothing but distractions for company.
Finally this all takes time. Whether it is finding a community of traders that you bond well with or perfecting your trading plan, it is going to take a while. Not only do you have strategies to research and back testing to do, but you have to break those 'bad' habits that you have picked up. Breaking bad habits takes time and you won't do it over night. Set realistic goals and aim to have the behaviour wiped out in 30 days. If you get to the end of the 30 days and you are still breaking the rules stick to your demo account and take another 30 days. As long as you improving and slowly adapting your trading style you will get there.
You may have burnt your account and lost various pieces of computer equipment but you are still reading this proving that you are determined to change. You know which direction you are heading and what you need to do to restart your trading journey. Good luck and happy trading.
About Bio: Andy Argent has been trading the FX market for the last four years and set up Forex Trading Floors in late 2012 as he was shocked by the impact a lack of trading community had on his trading account. Forex Trading Floors is a retail trading floor for both beginner and professional traders. Membership starts at £280 (incl.VAT) pcm.
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