3 Trading Mistakes You Cannot Afford to Make

5 Apr

These 3 trading mistakes will most certainly lead to disaster. More can be read about these mistakes here.

Impulse Trades –

The impulse trade is usually a much liked trade. It makes you feel like you actually know what you are doing, like you have some sort of control over the markets. Sadly, they always end in disaster. Go back and look for yourself. Evaluate your trades by how well you followed your setups.

Here is a post on how to evaluate your trades and improve your performance.

If you find yourself clicking sporadically on the trading ladder you need to stop immediately and reevaluate your trading plan.

Revenge Trading –

Just because you had a loss doesn’t mean your next trade needs to be a home run. Revenge trading is another mistake that most new traders make as they become attached to their previous loss and want to make it back. Try for consistent singles and doubles with a few strikeouts in the mix. Keep your losses small, and forget about them.

Trading Too Big for Your Account –

Trade to trade well, not to make money. This is such a crucial point when starting out. Don’t kid yourself in thinking that you will be making a 6 figure income a year after you begin trading with your $2000 account.

While possible to take an inordinate amount of risk and see a large return. It is not sustainable in the long-run. If you’re trading an account size of $10,000 then the max number of contracts you should be trading on the ES or 6E is 2, enough said.

Trade your setups as they come and try to incorporate the 12 characteristics of highly successful traders.

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