One of the biggest mistakes most new traders make, is to trade on emotions, tips and whatever catch their attention, it can work for some time, but not in the long run. To be a consistently profitable trader, you need to have some rules on how to act in the market. Have you ever experienced something like the example in the chart above?
If you have a trading plan, you will always know how to act in the market and where you are going to place your trades and take your wins and losses. Your trading plan primarily consists of a set of rules you should follow to profit in trading. You will take out much of the anxiety being in a large losing position.
When you, for example, have stated in your trading plan; you only risk one percent per trade. Having a trading plan makes trading easy and enjoyable, it takes the fear, anxiety and complexity out of it.
If you are in the market for the thrill, then you are not in it for the money, so if you are in it for the money; have a trading plan. It is difficult to follow a trading plan since it is in our nature to bend and break rules. You need to have the discipline in order to act consistently according to your rules. Done right and you will profit for the rest of your life and become the best trader you can be.
