Things A Trader Needs to Give Up if They Want to Make Money:
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Give up your need to be right: The market is always right, don’t strive to be right in your predictions and opinions. Strive to go with the flow of the market.
Give up control: No matter how long you watch a live stock stream, you have no power over the movements. Save your emotional energy by not trying to cheer on your positions and get wrapped up in every price tick.
Trading the price action as it plays out has a better odds of putting a trader on the right side of the market than a trader with a bunch of opinions and predictions.
Backtested signals that worked in the past have better odds of success in the future than guessing which way the market will go.
A stop loss is a risk management tool that keeps your losing trades small. The point of a stop loss is defensive and to eliminate big losses from your trading.
Here are ten tips for thinking about when placing a stop loss on a trade:
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Your stop loss should be a part of your trading plan on entry not figured out later.
The best time to set a stop loss is before you get emotionally wrapped up in the outcome of a losing trade.