Often times trading can become very exciting. There can be times you want to go around bragging that you made $1,000 today, you may get high off of your trading profits. But remember, it is impossible to get a high off of trading and make money trading at the same time. You can do one or the other.
Often times trading can become very exciting. There can be times you want to go around bragging that you made $1,000 today, you may get high off of your trading profits. But remember, it is impossible to get a high off of trading and make money trading at the same time. You can do one or the other.
That is because trading requires a large amount of self discipline. You must be able to trade without having a huge amount of emotion attached to your trading. You can’t be thinking, “I’ve got to make a profit today because…” the market doesn’t work that way.
Even for a short term trader the stock market is still a long term strategy. The difference is, if you are a short term trader you have to rely on the long term outlook. You may lose a little here or win some there, but in all you should be heading up, in the long term.
Taking the emotions out of trading means you have to be able to follow your system without getting a high when you are making money or getting depressed when you are losing money. The ideal way to trade is like a robot, buying stocks when they give you a buy signal and selling them when they give you a sell signal.
If at any time you wonder whether you should sell your stock to accept your losses or weather you should get out and keep your gains, you are trading wrong. A robot does not wonder or think it simply follow the rules already in place. And if you want to be a great trader you must be disciplined enough to follow your rules.
In order for you to trade like a robot you need to do 3 things.
1. Develop a set of rules that you use to determine when to enter or exit a trade. Every trade you take should follow your rules.
2. Test your rules by back testing and paper trading. This is the best way to figure out if your rules will work in the long term.
3. Follow your rules. Never hesitate to buy when your rules tell you or sell when your rules tell you.
These three steps allow you to make money in the markets and allow you to trade unemotionally.
For more information about the stock market visit http://www.stocks-simplified.com
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