July 23, 2020

Top 3 Secrets to Becoming a Good Trader

Despite the fact that trading in the stock markets is one of the best-paid activities (especially during the last century) it is also one of the most complex, especially considering that 85% of traders fail

Despite the fact that trading in the stock markets is one of the best-paid activities (especially during the last century) it is also one of the most complex, especially considering that 85% of traders fail. Success in these markets does not derive from luck or “direct manipulation” as some indicate, but from the discipline and perseverance, you dedicate to it, as happens with any other profession.

Even if you find it difficult to learn to trade, after a certain number of days invested in studying the market, you can only become better in your operations. Although there is no magic secret to profit from trading, there are a series of guidelines that, if respected, will give good results.

Disclaimer: All the information provided in this post shouldn’t be considered investment advice but rather educational content. We are not advisors. If you trade, always contact your professional adviser and never invest more than what you are able to lose

Psychological factor

The first thing we must do to be successful is to have absolute control over our emotions, almost to the point of thinking like a machine. Even if you have very good analytical skills, it won’t do you any good if you try to create fictional opportunities out of frustration after losing a trade. We must get used to placing orders only when we see the patterns we are looking for, otherwise, let the market take its course.

Emotions such as greed, enthusiasm, anger and nerves can completely stabilize our strategy. For this reason, sometimes it is better to program our trades, position these orders and forget about the market for a while, which will prevent us from interfering with our own operations.

Hard work and dedication

As we have previously explained, achieving success in trading is like becoming an excellent doctor, lawyer or engineer. The only thing that differentiates failure from success in the markets are the hours you are willing to dedicate to analyze and study candlestick patterns.

Eventually, you will develop a special sense to determine exactly at what point it is convenient to issue an order and / or when it is advisable to close a trade. Think of your analysis skills as a muscle that you will need to exercise every day, in order to watch it grow.

Although there are other alternatives that allow you to obtain some profitability without having a deep knowledge of the market (as in the case of trading signals), these options will never give you the benefits that you would obtain if you decide to do it yourself. Furthermore, limiting yourself to trading signals means you underestimate your own intellectual capacity, which we are sure you should not do if you want to be successful in this space.

Having a trading plan

Even if you are ridiculously good at identifying trading opportunities, it won’t do you much good if you don’t stick to a trading plan. It is necessary to have a rational risk management and parameters that you cannot violate under any circumstances. If you manage to follow your own instructions and get used to earning double (or triple) what you lose, your balance will always remain positive.

Trading plans also help not to over-trade, which can also be detrimental to the trader. Our trading plan must calculate the risk behind each trade and how many positions we can position per day, including a schedule to take advantage of high volume levels according to the available pairs.

Tools such as indicators, bots and trading tips will only help us if we can question each decision and decide if it is the best course for our operations or not. Once we are able to master these aspects, trading will be as routine and simple as doing your daily tasks.

Despite the fact that no trader has a record of 100% in positive trades, the balance sheets will always add a decent capital if we respect our own parameters and we will have more successful trades than failed ones.

AltSignals Team

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The AltSignals writing team consists of experts dedicated to the world of finance and technology, with a particular focus on cryptocurrencies and forex. Our writers bring a broad range of knowledge and experience, cultivated through years of arduous and direct involvement in financial markets, as well as intense technological collaboration.

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