I know it’s a bold statement but this article is not going to be what you expected – it will hopefully lead to a complete mindset and paradigm shift 🙂
Keep reading and I promise that at the end of this article, you will have experienced a few aha moments…
The steps towards profitable trading
First, you need to be honest with yourself and analyze your current stage. Where are you right now as a trader?
If you are either losing money consistently or barely breaking even, do not ask how to make 100% a month or a week. Such an approach will get you on the wrong path, and it will force you to look for shortcuts, adopt lousy trading habits and destroy your risk management.
Many traders falsely believe that they just have to find this “one thing” – a different indicator, a new entry pattern, a different setting, a better timeframe, or any other trick – to become profitable.
But just like 30 minutes ab workours, diet pills or 10 days juicing won’t turn you into a professional and healthy person, it takes more to become a profitable trader than looking for those “easy fixes”.
The good news is that the path towards profitable trading follows a slow but steady progression.
Success in trading is plannable and can be achieved.
First, you need to avoid the big and dumb losses. Get a structured approach, subscribe to a single trading style, establish rules and get control over your risk management.
Then you lose less. Your account moves a little less volatile, and you do not have the big ups and downs. This is a first significant step, and you will also feel much better emotionally. You can make small adjustments and work on your weaknesses targeted.
When you come into the break-even phase, things become interesting. This is where many traders go wrong. If you have been losing consistently previously, trading at break-even is already enormous progress. Acknowledge your progress and be proud of yourself! Further, analyze your trades and look for commonalities in your winners and your losses.
How much return to become profitable?
Ok, now the second most important question. If you understand this concept, it can cause a HUGE mindset shift for you.
Many traders mistakenly believe that they need to make 20% a week or 100% a month before they are profitable traders. Wrong again! You MUST get away from those arbitrarily high-performance numbers. First of all, it’s unrealistic that you can reach those. Second, having such huge goals and then not reaching them is frustrating and demotivating. And, finally, it will push you towards lousy trading behavior.
I know that this is not what you wanted to hear but how great would you feel if you could stop losing money all the time and make 1% a month? hm…. 1% a month probably sounds ridiculous for most but detach yourself from the actual number for now.
Just imagine how great you would feel if you could stop losing week after week!? How happy would you be to see a black number in your account at the end of the month? All the frustration, the pain and the sadness that comes from losing for months will slowly vanish.
At the same time, how could your trading change if you aim for 1% a month? You can be calmer; you can be way more selective, you do not have to worry about the big trading size that will bankrupt your account, you can approach your trades from a relaxed mindset.
When I talk to traders, most would agree that they could probably achieve this 1% a month goal without too much stress. Traders can avoid all the trades they know they should not be in, do not have to over-trade or revenge-trade and they can only take the absolute best A+ setups.
How to get to 100%?
Once a trader can achieve this mindset shift and approach his/her trading from a more relaxed and selective perspective, profitable trading often is within reach.
And once a trader has proven that he can make 1% a month, he can slowly scale it up. But do not rush things now. You have to grow into the bigger size.
Try increasing your positions slightly, maybe start looking at more markets to find more opportunities, drop to a lower timeframe to find more trades (stay selective) or work on letting your winners run more.
This way, you can slowly go from 1% a month to 2%, 5% or even 10%. It takes time, and you have to pay attention to yourself and how you respond to the added stress. Each time you introduce a change, pay close attention to your trading journal and how you react emotionally and mentally.
Profitable trading isn’t a sprint, and even if this takes 3, 4 or 5 years, it is still worth it. And always ask yourself: what is the alternative?
What is the alternative?
What will happen if you keep doing what you have been doing? Do you believe that system-hopping, trying new indicators or asking other people how to become a millionaire trader is the way to go? Is this how professional trading looks like?
No! If you do not get into the mindset of slow and steady improvements and a slow and steady increase of your trading performance without those unrealistically high numbers, then you will come back to this article in a few years, still struggling and kicking yourself in the butt because you wasted so much time and money.
I know that I could quickly pump you up and tell you that you can double your account every week if you just subscribe to my trading course, but that’s not what Tradeciety is about. We are here for the long term. We help traders get into the professional mindset, create a long-term trading career and make a change.
I urge you to let this lesson sink in and understand that profitable trading is not something you suddenly stumble into. At the same time, it’s achievable, and success is plannable if you commit. I hope you forgive me with the click-bait headline, but I am sure that the tips made up for it 😉
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