Once you have been baptized in the ocean of trading, you will recognize there is a lot to learn. Most traders start out following the lead of other traders. After being bitten by several professional sharks, they decide it’s time to swim to the shore and start over. While you may benefit from learning and trading alongside other more experienced traders, eventually, if you are going to last in this profession, you will need to develop your own style.
One of the most common traits among the absolute best traders is objective trading. If you haven’t noticed yet, many good traders sell their one type of trade they do well. They have learned how to get an edge on the market by developing expertise in one good trade. Perfecting your one good trade can be a lifetime winning strategy.
Initially, I suggest you focus on only one or two types of trades. Perhaps you can focus on one specific type of day trade and one swing trade. Specializing in a single type of trade set up allows you to focus on specific details of that specific trade. Perhaps you like a particular swing trade that has already been successful for you. Now it’s time to really get the trade details right.
By focusing on a lone type of trade, you can carefully track your results and monitor your mistakes along the way. As in any trade, defining an entry price that you can live with, an exit target, and maximum risk level before you enter the trade are essential. Create a named chart that has the specifics you look for in that specific trade. This would include the time of your candle length, 5 minutes to daily, to specific leading and lagging indicators to monitor the trade like stochastics, RSI, MACD, volatility squeezes, etc.
As you progress on mastering just one trade, your confidence will improve. By focusing on the set up and other mechanics of the trade, you will be able to identify specifics of that type of trade you may otherwise overlook while managing a basket of trades. By getting good at one type of trade, you will learn quickly when to push more chips into a winning trade or quickly exit with a small loss if your edge doesn’t manifest as you anticipated.
Preparing for the trade before the market opens is very important. In fact, the best traders spend most of their time preparing for opportunities that may arise when the markets are open.
You want to set a good entry price, and set an alert for your entry. Once you’re in the position, you can immediately set an exit order or an alert when your target is hit. When you have the trade mastered and it is repeatedly profitable, ride it like the Lone Ranger on Silver. After several months of perfecting one type of trade, you can add another type or simply ride it alone into the sunset.
Enuf said.