Members of my stock market trading discussion group often ask me for my opinion on the technical analysis of stocks they are keeping an eye on. During our conversation, I found that there is one thing that both successful and unsuccessful traders have in common.
In general, both types of traders like to look through their lists of active stocks to find stocks that might be good to trade. The traders in the winning group, on the other hand, are very clear about how they trade and have a clear plan for when to enter and leave the market.
When they trade, they know exactly when to buy and sell, so they don't let their emotions get in the way. After they make a trade, if they're right, they can ride the trend, but if they're wrong, they have to get out of the trade with a set loss. There's nothing vague about the way they trade.
People who lose money in their trades, on the other hand, never have a trading plan or even something that looks like a trading plan. This group of traders follows tips from other traders without being able to check or confirm the tips through technical or fundamental analysis. They don't know when to get into a trade or when to get out with a stop loss.
Again, when successful traders have figured out their entry, exit, and stop-loss points, they can approach their
trading day with cautious optimism, waiting to see if the expected rally will happen. By keeping an eye on certain price points, a trader can tell if a rally has started and start trading more aggressively or stop trading based on wrong expectations, which is easy to do if they listen to tips from here and there. If the trade goes against them and their stop loss is hit, they take the loss calmly and get out of the market. This keeps their losses to a minimum.
Remember that you are trading and investing with money that you have worked hard for.
Nothing about trading is UNCLEAR. If you want to be a successful trader, you have to figure out your entry and exit points ahead of time. This lets you control your risk.
If you learn how to do this well, you will be able to trade consistently. You can make money if you try out every tip and add specifics to your trades. In every job, the person who is best at what they do makes the most money. If you learn how to trade well, you will make money.
