I have been "LEARNING" and trading the markets for almost 10 years now. This made me realized that: 1) I am getting old liao, and 2) I had become a more realistic and conservative trader as compared to 10 years ago. Throughout these 10 years, I've been through the frustrations, hopelessness, paranoia, exhaustion, and "the fear of losing money". Basically I had experienced all the painful experiences there is in trading and learned a few important trading lesson.

I truly understand the pain and frustrations new traders are experiencing right now. The older I get, the more deep desire I had to guide new traders trading futures and forex. I have much personal satisfaction guiding and transforming them from losing to profitable traders than making profits for myself.

So today I decided to write down the important lessons that I've learn in 10 years of trading. Let's get started. {C}

LESSON #1: Trading capital preservation is the key!

This is rule number one if you want to stay in this business in the long run and make money. As a new traders, your first step is to learn how to preserve your trading capital. Think about it guys: You only have limited "ammo" in your pocket. You do not want to waste your "ammo" in those low quality trade setups, right? A quality trade setups are obvious, literally they can catch your eyes!

There is a misconception in the futures and forex trading that if you want to win big, you have to make a lot of trades. This is wrong. Successful traders always wait patiently for the market to trigger their trading setups. They won't trade if there are no quality setups. It may sound counter intuitive, but no trade done is a good trade. This is because you will not incur unnecessary losses that bite a chunk off your trading capital.

Besides that, no trades are guarantee winning trades. Therefore it is very important for traders to limit their potential losses. You need to be practicing risk management and make sure your are not risking a huge amount of capital per trade. And let's not forget on your risk and reward ratio! Learn how to tip the odd in your favors. That's how successful traders and me able to sustain the market in the long run and make money.

Free Upcoming workshop(Click Here)

 

LESSON #2: Previous results should not affect your next trade.

You have to understand that winning and losing trades are totally random. Every trader, from professional to losing traders, will encounter losing streaks. It is only the successful ones who truly knows how to handle each trade.

To be good in trading, you must not let your previous trade result affect your next trading decision. What I mean is you will lose sight of the big picture and not doing things you supposed to do, if you let the previous trade's result influenced you. As a result, you will rack up a lot of losing trades. Worst still, you will just need 1 losing trade to erase all your profits.

This is because there is no universal force or commandment that says if your previous trade is a winner and next one is a winner as well, or vice versa. What you achieved in the previous trade does not guarantee the next will be a winner. This is because there is a possibility that the next one could be a winner or loser, it is still 50-50. At the end of the day, it doesn't matter whether your previous trade is loser or winner. You just have to follow your trading plan!

In addition, a trader also need to be extra careful after hitting a big winner. I've seen many traders became over-confident after a big winner. They then started to increase the stakes by taking a huge positions and taking high risk trades. However often that not, just 1 or 2 losing trade is big enough to wipe off the capital away.

So the next time you achieved a big winner. Take a rest and continue to trade based on your trading plan.

LESSON #3: Mastering yourself

Based on my 6 years of teaching experience, a disciplined person have a higher chance to be a profitable trader. This is because ONLY disciplined trader can control their trading emotions during live market hours.

In trading, you are not competing against other traders. In fact you are actually competing against yourself. You are your worst trading enemy. Many traders often lost to their greed, causing them to take extremely huge trading positions, which exposes themselves to too much risks. All it take is just 1 losing trade to burn down an entire trading account.

Besides that, many traders often have too much hope in a position. They wouldn't want to cut loss when the time comes. So instead cutting for a 10 point loss, they often hold it until it incurs a 40 point losses or more. Little do they know that if they cut for 10 point, they could have the opportunity reverse their position and earn that 30 point. In the end they would have a 20 point net profit.

Traders also let fear taken control of their trades and entering the market too quickly without a quality signal. Many fortune had been lost because traders have the fear of missing out.

Hence to be a good futures and forex trader, it is very important to be a discipline trader that follow the trading plan. Always plan your trades and trade your plans.

Learn to trade (click here) 

 

LESSON #4 There is no perfect trading strategy.

You have to accept that in this world there isn't a holy grail of trading strategy. Every trading strategy has it own natural flaws. A good trend following technique is useless during sideways market. A range bound trading strategy will cause you missed a lot of profit during trending markets.

Similarly, a moving average strategy works best during trending markets, while a harmonic pattern such as gartley only works during consolidation period.

Here are few more examples. Prices might never come back/fade if you are a retracement trader. If you are a breakout trader, then you might suffer losses if there are false breakouts.

As you can see each trading strategy or indicator has it own natural flaw. Nothing is perfect! That's why you need to have good risk management to take care your back. You need to have a set of trading rules that tells you when to cut your losses short.

CONCLUSION

What we discussed here today are the lesson I've learned the hard way. I've organized a free workshop which we will discuss in detail so that you can shorten your learning curve and get started on the right foundation.

Join Our Upcoming FREE workshop! Cick here!