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Top 10 Rules For Successful Trading

Thanks again and all the time Mr Nial. If all the above rules are followed strictly and religiously, in the end, more often than not, you will end up on the winning side. So, try to harness the power of making good habits in a positive direction. Hard research allows traders to learn the facts, like what the different economic reports mean. There is a tendency amongst novice traders to place a trade when the market is experiencing high volatility and try to generate quick gains, based on gut feel, without a specific trading plan. Markets may have changed, volatility within a certain trading instrument may have lessened, or the trading plan simply is not performing as well as expected. Once a plan has been developed and backtesting shows good results, the plan can be used in real trading.

May 19,  · Hi dear traders, l want to share with you some notes from a very nice e-book l found over are 25 rules that l think will be very useful for every trader.l just edited it to make short.l hope you can also write your own rules. market pays you to be disciplined:Trading with discipline will put more money in your pocket.

Thank you!!

By far the worst is when you become so attached to the position that it eventually reverses and your gains become losses. You then become angry that you let this situation occur, and decide to hold on until the market moves your way.

Your anger morphs into fear, as you begin to lose money, but you hold on to the trade and shrug aside your initial stop loss level leading to excessive losses. You pray to GOD to save you and that if HE does, you will never let this happen again, so long as you can just get back to breakeven. But that day it seems that GOD may have been away from the office, as HE is not heeding your cry for help.

This type of negative greed can be difficult to overcome. There is something inside all of us that makes us want to scratch out every bit of profit from a trade. You need to be smart about your strategy, and avoid trying to extend unrealistic gains, especially when your profit target has already been reached.

Trading rules are very important for every level of trader experience, but most important for the novice trader. Most novice traders are eventually knocked down and never figure out how to recover. By having specific rules in place, you can help yourself fight the emotional swings you will experience while trying to make money trading. Remember, you are not the only trader out there, there are countless people trying to make money trading the currency markets.

While the game is not completely zero sum, as many people are using the currency markets to hedge exposure, nevertheless you need a solid edge and focused mind in order to compete successfully. If you are the kind of trader that tends to get overly greedy, train yourself to put an order in the market that designates your take profit point.

If you find that you get antsy as a currency pair approaches your mental stop loss level, put a hard stop in the market and let the market take you out. Be careful and make sure that your take profit and stop loss levels account for market noise, which will help you avoid getting stopped out by the normal market fluctuations. If you make or lose a specific amount you can take a break or cease trading for the day. You should periodically review and assess your performance along with the strategy that you are using to trade the markets.

This goes beyond evaluating your returns to see if you are hitting your goals, it also means analyzing how you reacted to specific situations.

By analyzing what you did right and what you did wrong you can improve upon your performance. If you see specific mistakes you can correct them. Remember, what can be measured, can be improved. Trading the capital markets requires a good trading strategy that you can execute efficiently. In addition, you need to be able to follow a disciplined trading plan, and avoid letting your emotions get in the away.

You must understand that fear is a very powerful emotion. Most traders feel pain when they are losing money. This is a psychological crutch and needs to be addressed by each trader. When you come to grips with the concept that your reward is directly correlated to the risk you take in the market, you will understand that losing money is part of the trading process. It is the necessary cost of doing business.

Greed along with fear are the two emotions that dominate the trading landscape. When the markets move your way, it can become difficult to act prudently and stick to your trading strategy.

Allowing greed to take over will eventually create a situation where you invite fear into the equation if the market turns against you. You can help yourself in becoming more familiar with these emotions by reading trading psychology books, but its only when you are actually trading will you really appreciate its effect on you. Download the short printable PDF version summarizing the key points of this lesson…. Click Here to Download.

Click Here to Join. Long-term profitability requires two interrelated skill sets. First, we need strategies that make more money than they lose. Second, those strategies must perform well while the market shape shifts through bull and bear impulses, with plenty of choppy periods in between.

While many traders know how to make money in specific market conditions, like a strong uptrend , they fail in the long run because their strategies don't adapt to inevitable changes. To learn more, see: So can you break away from the pack and join the professional minority with an approach that raises your odds for long term prosperity? But you can learn more by reading: Stay away from stock boards and chat rooms. This is serious business and everyone in those places has an ulterior motive.

Engage your trading plan - Update your trading plan weekly or monthly to include new ideas and eliminate bad ones. Go back and read the plan whenever you fall in a hole and are looking for a way to get out.

Avoid the obvious — Profit rarely follows the majority. The easiest example is when setting your risk to reward ratio. For example, you might set a stop loss on a trade to be 30 pips, but the take profit at pips which is the same as saying I am willing to risk 30 pips but want to win pips which is a ratio of 1: Anything better than this and you are in profit.

Us humans are greedy by nature. We are also emotional and the reason why the majority of traders fail is because we simply are just human and don't have the right trading psychology. Having said that, does an automated trading system make better trading decisions? Not always because they aren't able to process news and events that may affect the market. So really, a combination of both is probably the best method.

You can use automated scripts to help you identify patterns and you can have manual input in assessing the market from a news point of view to confirm your analysis. Discipline also refers to money management.

So there's no reason to steer away from your set strategy just because you have a "gut feeling" and double up or open a bigger trade than you usually would. Forex brokers who are listed on our website must be regulated with at least one regulatory body. Click here for a full list. Margin trading can be beneficial but also detrimental.


In Forex trading, discipline means following your trading system rules strictly and precisely. I dare say, religiously. Back in the days when I started out as a trader, over 95% of Forex traders were losing, not because they didn't have a good trading system or because they didn't learnt the right techniques. Today we are going to discuss how the 80/20 rule applies to forex trading and the significant positive impact the "80/20 mentality" can have on your professional trading performance. As a price action trader, our job is to analyze the price action and have the discipline to not trade during the choppy. POINT MANTRA The success that a trader achieves in the markets is directly correlated to one’s trading How,then,have I been able to succeed,day after day,trading the markets for more than 20 years? The answer is simple: I trade with discipline, and I respect the rules of trading discipline. I listened to his guidance.