As 2022 come to an end and 2023 approaches, it’s an important time for a trader; it’s time for you to make an honest assessment of your trading performance over the last year. The dawning of a new year is the perfect time to set new goals and embark down uncharted paths. Now is the time to plan your Resolution.
You can have a bad/good/Neutral trading year, it’s time for an honest self-assessment of the things you did right and wrong over the course of the 2016. If you want to grow as a trader you will need to reflect on your mistakes and correct them for a better 2017. If you can’t be honest with yourself about your trading performance in 2016 and own up to the mistakes you committed, you stand little chance of turning the ship around in 2023.
Before we get to some suggested resolutions, I’d like to offer my point of view on trading motivation. In my humble opinion, keeping motivated is one of the most important psychological things in trading.
Learn and Stick to the Strategy
NO ONE makes money in the markets without following a trading plan based on Trading Strategy. Trading plans is what make the traders money. They are the difference between winning, and losing.
First and Foremost If you do not have a strategy learn it by yourself or from traders who are already trading profitably. Learn and Earn should be Motto. Without Learning No once can Earn. In every professional career your First you Learn than only you are capable of Earning, Same goes true with Trading.
And if you trade a plan, you have to stick to it. Never Jump from 1 system to another one. If you are acting on emotion and making a decision other than what your followed strategy tells you to make, you are setting yourself up for disaster.
Trading plans are designed to keep us from making rash decisions are times when the markets are volatile, when emotions are high, when the vast majority of traders are panicking and making mistakes. This is when your chosen plan will keep you safe.
First and Foremost New Year’s resolution for this year would be, “Learn the Trading Strategy and Stick to it !”
Follow the Plan.
The Apollo astronauts had extremely thorough flight plans for landing on the moon. Landing a spacecraft hundreds of thousands of miles away from the earth, with no chance of a rescue in the event of a catastrophic failure, was risky to say the least. The astronauts thoroughly practiced these plans and developed extreme proficiency at following them precisely. In my observation, we are often undisciplined in following our plans. It is a natural human tendency to be distracted, or fail to follow-up and hold others accountable for meeting their commitments. A plan is no better than our follow-through. Making contact with the ball—having the plan—is only the beginning. We need to swing through and make sure things happen.
Trading is serious business with real money on the line. Why would you go into it without a well-thought-out plan of action? Yet, most people do.
HOPE IS NOT A PLAN
Without a plan, you can only rationalize. Often you will tell yourself to be patient when you should be selling, or you may panic during a natural pullback and then miss out on a huge stock move.
Why you Exit Quickly in a winning trade ?
- You don’t know when this rally will end and want to make lock in your profit.
- You exit out because you don’t have a plan.
- You exit out because of a previous instance where you didn’t book small profits and ended up in a loss instead.
Why you hold on to losing trade ?
- You hold because you don’t have a plan.
- You THink Someday Stock will Rise so why to Exit in Loss
- You don’t exit the trade because there was one good old day where the market rewarded you for holding on to loser.
Invest on Trading Education:
To become Doctor Engineer CA or master any other profession you need to study and master the concept.But trading is only profession in world where traders enter without any knowledge with small amount of money in account, lose money due to lack of knowledge and than blame market for their loss. “Trader should be responsible for his/her losses.” Be accountable to yourself and do not give excuses. So If you feel you are not having proper knowledge,invest money on your trading education and stop getting fleeced by market.
TAKE ACTION on Your Trading
Delay is the worst thing you can do when trying to accomplish a goal. People convince themselves that they’ll do something when everything is “perfect.” While I certainly do encourage you to learn all you can, I don’t consider that a delay. When you walk around thinking, I’ll start—someday, maybe soon, just not right now, that’s delay
The longer you put off committing to something, the easier it is to delay it even more, because the closer you get to a challenge, delay shouts all the louder. The counterpunch to delay is action. You must take action or nothing will materialize. If you wait for the perfect time or when you think you have all the answers, you may never get started.
Have defined loss limits
Losses are a fact of trading. Unfortunately, those losses can come in a string for any number of reasons. Maybe the market just has been going against you, or maybe it is time to reevaluate your trading strategy. In any case, knowing when to step away from the trading desk sometimes can be the best thing for your trading account. Having defined daily, weekly and monthly loss limits can help to keep you trading for another day.
When I first started, it took me three long years to become profitable. Through those challenging years, though, I stuck with my strategy. I didn’t jump from one approach to another as if there were some magic formula out there and the secret was finding it.
There are no shortcuts. No matter how many books you read or how many workshops you attend, you can’t force experience. Don’t get discouraged if you’re not getting big results right away. No matter how much knowledge you soak up or how smart you are, you still need to put in your time at the Financial Market.
Wishing each and every one of you a happy, healthy and prosperous New Year. Happy New Year!