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Trade Management

WHY MONEY MANAGEMENT IS THE MOST IMPORTANT RULE OF TRADING!Hey Traders here us a quick video that explains why money mangement is essential to trading success. Regardless of what level of trading education and experience you are this can benefit your trading. Without proper risk management it is very difficult if not impossible to protect your investment capital. Trading is a game of probabilities and in order to come out ahead I think it's important to know when to risk more or when to risk less. Especially when you are on a role in a winning streak vs waiting for the tides to turn during a losing streak. Enjoy! Trade Well Clifford
Education
by TradeTheIndex
6
Learn TOP 5 Tips For Trade Management 📖 Hey traders, In this post, I will share with you my tips for trade management. But first, let me elaborate on what is exactly a trade management. Trade management is the set of rules and techniques applied for managing of an already active position. Trade management is a very important element of any trading strategy that should never be neglected. 1. Never remove a stop loss Being in a huge loss, many traders refuse to admit that they are wrong. Instead, watching how the price moves closer and closer to a stop loss, they remove stop loss hoping on a coming reversal. The alternative situation may happen when the price is going sharply in the desired direction. Watching the increasing profits, traders remove a stop loss, being afraid to miss bigger profits. Both situations may lead to substantial, higher than initially planned losses. Driven by many factors, the market can easily burn all gains and move against the desired direction much longer than traders stay solvent. For these reasons, never remove a stop loss. It must be always set. 2. Never modify your stop loss if a position is in loss Watching how the price moves closer and closer to a stop loss is painful. Instead of removing stop loss, some traders move it and give the market more space for reversal. Even though such a technique is safer than the complete stop loss removal, it is still a very bad habit. Each stop loss adjustment increases the potential loss, not giving any guarantees that the market will reverse. It is highly recommendable to keep your stop loss fixed and let the price hit it and admit the loss. 3. Know in advance your profit protection strategy Where do you take your profit? Do you have a fixed tp level or do you apply trailing stop? You should always know the answers. Coiling around take profit level but not being able to reach it, the price makes many traders manually close the trade or move take profit closer to current price levels. Another common situation happens when the market so quickly reaches the desired TP level so the traders remove TP hoping to make bigger than initially planned profit. Such emotional interventions negatively affect a long-term trading performance. TP removal may even burn all profits. Do not let your greed intervene, and always follow your rules. 4. Never add to a losing position Watching how the price refuses to go in the intended direction and cutting a partial loss, many traders add to a losing trade in hopes that the market will reverse and all the losses will be recovered. Again, such a fallacy usually leads to substantial losses. Remember, you can add to a position only AFTER the market moved in the desired direction, not BEFORE. 5. Close the trades manually only following rules Quite often, newbie traders manually close their trades because of some random factors: they saw someone's opposite view, or they simply changed their mind. Remember, that if you opened a trade following your trading plan, you should always have strict rules for a position manual close. Do not let random factors affect your trading. Following these 5 simple tips, your trading will improve dramatically. Remember, that it is not enough to spot and accurate entry. Once you are in a trade, you should wisely manage that, following your plan. ❤️If you have any questions, please, ask me in the comment section. Please, support my work with like, thank you!❤️
OANDA:XAUUSDEducation
by VasilyTrader
5
Confirm Fundamental Analysis With The Olympus CloudWe used the unfortunate global environment to pinpoint natural gas as a trading opportunity in early 2022. We then used the Olympus Cloud to define entries and exits. When we are trading on a longer term time frame, such as the daily, and we are confident our fundamental analysis is on point, we will risk up to 4 times more (5-8%) than we do in our high frequency trading (2%). In these trades, we required the Olympus Cloud to indicate a higher swing low than the previous low combined with a confirmed bull cloud transition -- it's as simple as that. Our stop loss was under the cloud, and our targets were 2R, and 5R respectively. As you can see in the data section below this post, our commodity account has grown by over 35% YTD, with 12% in additional gains currently open. The trade accuracy was 80% with an astonishing profit factor of over 9 -- meaning we gained 9 times our risk. Of course, if we had gone all in, these trades could have earned up to 80%, but had the trades not worked out we would have taken huge uncontrolled losses. When you are trading with proper risk management, you will not earn as much, but you will keep your profit margins in check and won't suffer massive losses that are hard to recover from if the trade does not go in your favor.
OANDA:NATGASUSDEducation
by Level8Trading
7
It's Worth to Wait on BitcoinThe market movements in the last few hours in some markets have greatly shaken some traders or investors. For those who see falling prices as an opportunity, it may be necessary to hold back on putting their funds in Bitcoin at this time. As we can see in the picture, the price is very strong pointing downwards. And it's not final yet. If this month the price closes through the 1st line area, then it is certain that the price will strongly head to the 2nd line area. It's worth to wait!
by tariganhuli
Keeping Lot Sizes the SameHey Guys! Do you find your self increasing and decreasing the lot sizes you trade depending on your trade set up? Or perhaps even doubling down after a previous losing trade? I know I use to! For a number of reasons! The most common being "making up for previous losses". Now I don't completely disagree with different position sizes depending on the trade set up. It definitely has its place in higher levels of trading. When as a seasoned trader, the "revenge trade" temptation is mostly gone. However as a beginner trader, changing position sizes depending on the trade set up is a bad idea for 2 reasons: #1 It will likely destroy your account unnecessarily. By unnecessarily, I mean you don't have to lose money to learn how to trade. Although you may have to endure losses and persist through adversity in trading, the monetary losses can be small. #2 It deters the beginner trader from their primary focus. No, the primary focus is "not" to make money as a beginner trader. That comes later. The primary focus for the beginner trader is to hone and develop their strategy until the strategy becomes efficient enough to at least reach "relative efficiency". This means month over month, your profit and loss results are at break even. So when your doubling down on a trade, ask yourself, are you doing it to make money? Or are you doing it to develop your strategy? It's highly likely that you're doing it to make money. Again, you're changing positions sizes for the wrong reasons. So if you're a beginner trader, keep the lot sizes of all your trades the same. Focus and persist on honing and developing your strategy. There's a time and place for everything. When it comes to trading, focusing on making money is only relevant to the trader with an established strategy that's proven to consistently make money in the markets. Hope this helps! Have a great day! Ken
Education
by TradingForexPriceAction
1
Getting Over the Agony of LossesHey Guys! When a trader takes a loss, it can be quite hard. It can strip you of your motivation to trade. Or perhaps even sway your quality of life. But that doesn't have to be the case. Do you ever wonder why experienced traders don't have a fit after a loss, whilst beginner traders can go into a chatic godzilla-like tantrum? No, it's not because they're enlightened in some way or simply not prone to anger. It's because they understand what trading is "truly" about. Trading is simply about refining your strategy and honing it until it is capable of extracting consistent profits from the markets. Moreover they understand that in order to refine a strategy they will have to take losses from time to time. How else will they know if their strategy needs refining or not? Thus the experienced trader views a loss as an opportunity to further refine their strategy and more importantly views these losses as a necessary component to propel their trading to the next level. Now, viewing losses from this perspective, who in their right minds will throw a fit every time they take a loss? So just some advice to the beginner trader. If you don't have a specific strategy that you're working on and are hopping from strategy to strategy; consider making your own strategy. Of course this can be a mixture of strategies you came across in your trading education, but ultimately the strategy must be constructed with your original signature. This means that you understand the nuts and bolts of the strategy and thus have the ability to refine it when necessary. Once you begin this refinement process, upon a loss and the anger starts to kick in, you'll find that refining your strategy with the lessons learned from the loss will diffuse that anger that erupts inside of you. It will become an antidote that if persisted, will get you on the peaceful road to trading success. I hope this helps! Have a great day guys! Ken
Education
by TradingForexPriceAction
5
Good week for btc Due to the failure of the downtrend and the news of the Russia-Ukraine war, expectations for the growth of Bitcoin and other currencies have risen. Russia is using digital currencies for its financial transfers due to heavy banking sanctions. If the weekly stabilizes above 44,000$, we can see 45,700$ weekly targets and then 47159$ for Bitcoin . If the ceiling breaks, the next resistance range will be 50531$ If the red and blue lines collide in the Ichimoku indicator, we will receive another positive signal. White: daily yellow: month and week Keep in mind that this is just an analysis and not a buy or sell offer. News these days can overcome technical analysis . have a nice day
Long
by ardalanadeli
1
How To Succeed In Your TradingFocus on one single trading strategy One thing that many people try and do is switch between strategies constantly. This is setting you up for failure, and if the concept of probabilities is truly understood, you will comprehend the reasons why a single strategy will work. Any strategy is not going to have a 100% win rate, so first you should attempt at getting 50% of your trades right. After that mastering a 2:1 Reward to risk ratio is what will make you profitable. Trying to juggle many strategies will have you working tirelessly, but not moving forward in any particular one. Less trading, more education Many people have the conception that spending countless hours in front of the screen looking for potential set ups is how it should be, however that is completely wrong in my eyes. I spend minimal time now looking at charts and set ups, I highlight key levels I want to look at, along with alerts, and simply wait for the market to head there. Time spent looking at charts should be simply for education and mastering your strategy through back testing or simply understanding previous data. Approach the market from a neutral position Anyone that knows me knows how big I am on trading psychology and how I believe it is the most important aspect of trading. Emotions in trading can be one of your greatest enemies as it can lead you to failure even after your success. There are scenarios where you can take trades and be in positive which will lead you to feel over confident, happy, and those will ultimately will lead to irrational decisions if you let them. Those emotions will make you believe you are better than the markets, or that you can outsmart them, ultimately leading your successful trade to turn into a failure. The same can happen when you feel the opposite and lack confidence to enter another trade due to a loss, or think have feelings of doubt. This is why the market needs to be approached by a completely neutral position. Once you understand that for every person on one side of a trade, there is someone on the opposite side, you will begin to understand that the market itself is just a whole bunch of neutral information moving in nobody’s favour. Write your goals Affirmations are great and something that has helped me in every aspect of my life and not just trading. It is very important to write down your goals in order to manifest them into reality. All ideas first begin in the mind, and then come into the physical. Your goals need to be solidified, definite, and written down in order for your mind and yourself to know exactly what you are going after. Every single day, you need to read your goals aloud, envision them in your mind with every bit of detail possible in order to bring them into the physical. In order to achieve a goal you need to arrive at the destination first in your mind. Relax There is no need to rush a single thing in your trading journey, and believe me take it from my experience, every time I tried to, I failed. People attend university for years before going out into a career which then takes many years before mastering it, yet people want to master trading in a year. Patience is required in all aspects of trading, whether it’s on the charts themselves, or with your strategy, or with your learning curve. It all requires patience. If you are going after trading as a serious life career which you aim to remain in, then relaxing and taking your time is the first step. Nothing great comes from rushing it, especially the markets. Know how to handle your trades Based on your strategy and the concept of probability there are a number of things needed in order to appropriately handle your trades. Firstly, don’t touch your stop loss. I cant say this enough, but stop losses are determined as the final barrier before the trade is invalid, and they are determine before entering the trade. If you find yourself moving your stop, ask yourself why. You will find out mostly its out of fear of losing your money, which is one of the 4 fears of trading. Accept your loss and let the trade stop out, you had it there for a reason. Also, don’t leave trades behind out of fear. If you have a strategy that you have confidently developed, you should understand that the overall should be a greater number of winners than losers, and you should not leave trades behind out of fear, because they can be the ones that perform the best and make up for the losers. Another thing to have in place is an appropriate strategy for exiting your trades. Many people have trades that are in profit, however due to the lack of knowledge on how to exit their trades, they still end up not profitable. You need to have a system on how to exit your trades appropriately and at what levels. Always remember, the profit running on a trade is not yours until its closed. Risk management Yes, I know you have heard it and read it a thousand times already, but you have no idea how important risk management is until the day you master it and recognise it was the single greatest thing holding you back from success. People can have amazing strategies, the best reward to risk ratios, but with the inappropriate risk management trust me it means absolutely nothing. I have seen people overleverage on a trade simply because it “looked too good” compared to other trades, only for it to be the worst of the bunch. I have seen people lose tremendous amounts of money and one thing I can promise you is not a single one of these people lost 100 trades in a row at 1% a trade. Every single one of them lost their entire accounts due to ONE trade that they married. Risk management should be one of your main areas of focus, because believe me if you have mastered it, even with an average strategy you are doing much better than someone with an exceptional strategy with no adequate risk management. Keep track of your performance The only way to improve in any aspect of life is to first recognise what needs change and then work on it. It is very important to actually understand your positives and negatives and have them all tracked. A journal is one of the first steps in order to look in the mirror. Being completely honest is the only way a journal will work, and lying is only lying to yourself. If you are after serious improvement you need to appropriately identify all your flaws in order to better them. You should never feel down or behind, remember trading the markets is one of the biggest psychological challenges one can face, and that is exactly why not everyone is suited for them. Instead see it as a challenge to better yourself and achieve the perfection and discipline you have always desired on and off the charts. Trading the markets will teach you lessons that you will carry with you throughout your entire life and not just on the trading floor.
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COINBASE:BTCUSDEducation
by opes_trading_group
332
Trading Roadmap for 2022Happy New Year to everybody. Here is my roadmap for financial year 2022. It is simplified version but generally it says everything about what to do. Plan: Everything starts from the plan. It is very hard to navigate financial markets without it. As markets move constantly it's very easy to get lost or become controlled by emotions (fear and greed for example). The trade plan is a tool that helps us. It takes some market knowledge and experience to develop a good plan and then discipline is needed to follow it. Also sometimes there is a need to modify the plan when conditions change drastically. Wait: Patience is essential part of good trading/investing. If you miss some opportunities then calmly wait for another ones - they are always coming. Execute: Do what you have previously planned. It is a trade management - also important part of trading. You can be right with timing but without trade management you could easily see all your 'paper profits' disappear. On the other hand you can be dead wrong with timing but with proper management it is possible to squeeze more out of that trade than from previously mentioned example. Accept Results : Probably hardest part to deal with when things are not going well. People just don't like to lose money but this is part of the game. I always try to think about it as cost of doing business or the amount of money I need to spend to make myself available for the winning trades. More info about how to deal with the losses can be found from my earlier posts: Trading in the Zone Trading in the Zone 2 Accepting results happily takes some practicing :) Learn: Making screenshots from your past trades is best option how to learn. It is also essential part of 'Journaling'. I like to save all my trades with real-time notes and comments - and then later analyse them. Repeat: Becoming good at something in this life requires work and practice. Trading is no different. So process starts all over again - enjoy. I wish you all the best for upcoming year. Cheers :)
Education
by Laurentsius
8