Becoming Emotionally Detached is a Great Trading Tool!
There are certain rules you need to know to succeed as a short-term trader
Trading requires a cool head (trading meditation) and a solid CFD trading strategy that trades both sides of the market long and short such as CFD Trading https://tradinglounge.com/cfd-trading-guide
Understand the basic technical analysis starting points of price and volume
For charting patterns Elliott Wave is the only pattern recognition that connects all the markets patterns and is worth learning, but it takes time and effort. There are many aspects to Price and the Trading Levels is one that is worth understanding.
Short-term CFD Trading Strategies or day trading is mostly carried out by reading price and volume. Understanding this price/volume relationship is critical if you’re to survive the fast pace of short therm leverage trading. Being able to read the market’s depth is imperative, like a musician reading a score - understanding the layered, intricate rhythms and where the next note or bar is coming. The same goes for trading.
You need to understand how the numbers flow from the market. All the indicators traders have created will only confuse the issue. They are derived from price and volume anyway, but they are walking sticks. When trading derivatives, you will need to sprint. Indicators only interpret the market action, so don’t take your eyes off their foundation – the price and volume.
Investing capital long term is fairly easy compared to short term trading. Many research companies offer reasonable advice and most is easy to access, but if you’re looking to maximise your capital return or just fancy a flutter, look into short-term trading.
Choose your “trading time frame” and understand it: who’s in control of your frame, where is the momentum, where’s you entry and exit within that time frame. Then, trading the small friendly trend until it ends takes discipline, courage and patience.
The market is an emotional place because its a money place
Trading shorter time frames also brings a whole host of complications: emotional trading is the number one complication, as price, in technical trading, is psychological.
I say this because new traders think they are trading money, and that’s true but the numbers come much later. In the beginning it’s their belief about money they’re trading – the primary emotional obstacle that needs mastering. Our relationship to our money is deep – it’s our security, safety and happiness. When our money goes into the market, a part of us, our psyche, has also entered the market. Our thoughts have connected us to the market – we are the market.
When the market goes on the roller coaster along with our trading capital, we’re at the emotional mercy of ourselves and the markets, and the markets reflect that. The most common comments I hear from new traders is “shoulda, woulda, coulda”. Total responsibility for all your own actions is an absolute in trading professionally. Until a new trader can become detached from the emotional fear/greed/money/thingy – they are doomed.
Money Management, money management, money management
My motto while learning to trade is less is more, meaning using less capital per trade so that at least one can think more clearly. But the irony here is that new traders find using small amounts of capital boring, so they tend to use an amount that gives them an emotional experience ultimately leading them into deep waters. Defensive trading and capital preservation are number one one the learner’s list. Seeing your mistakes and recording them starts with keeping a trading journal and understanding a basic money management.
Once a traders mind becomes detached from the fear of loss and starts to focus on the game at hand, the natural flow of numbers coming from the markets becomes clearer.
See destiny unfold and then without reacting, clearly choose clean entries and exits, based on a knowing faith about the market, such as volume, price action and it’s momentum, supported by a little money management. You’ll be on your merry way as a budding new trader. Now you begin to realise the importance of trading methodologies and having systems in place.
Keeping it real simple
A very expensive pitfall for the budding new trader is all the trading software programs promising to solve all your problems. You finally realise that if these programs actually worked, they wouldn’t be selling them.
You realise this trading-shorter-time-frames business is going to take some real work and understanding, so after some hard thinking you seek out a mentor – someone who is actually out there trading. Now you’re on the right track. All you need in software is a reasonable charting program with a good data feed that shows you the bars and the volume. Next is getting alongside someone in your local area who has been trading for at least five years. This is one of the best first moves you can make. They are probably happy to help for free because they have been along the same path. Or you could join a local trading club.
Trading has multidimensional benefits, but it takes time.
Becoming familiar with the markets is a relationship that requires respect, not ego.
We offer real trading mentoring with strategies that remove you from the emotional rollercoaster