One trade to win it all, one trade to blow it all.
Let us zoom into what one trade can do to your account and what is the process for one trade from start to finish.
The Very First Thing
The very first thing is a Weekly timeframe chart analysis and Daily chart analysis, which I recommend you finish every weekend well before the markets open on Monday. Completing a flawless Daily timeframe chart analysis is the foundation. If you don’t nail this down, nothing you do later will matter. It does not matter what a cool opportunity you found or how good you feel about a trade if your weekend analysis is incomplete because over time your lack of preparation will show itself in trading results. Neither does it matter that today you’re feeling awesome. Do not trade without a completed weekend analysis. And do not skip your weekend analysis for each pair you intend to trade.
Why is weekend analysis so important? First of all, weekends are the only time that the market does not move and therefore distracts you the least, allowing you a maximally detached experience of analyzing the markets. It gives you the most objective bird’s eye view of the markets. All the more reason to spend time on analysis on weekends.
The Impact Of Unpreparedness For Monday
It’s not just lack of knowledge. By not being prepared for Monday you are actually automatically less confident emotionally because you have no clue what the market might be up to. You can’t cheat it. Tricking your emotions is far more difficult than you think. The lack of preparation will present itself like a natural impulse. What does your brain scream? Your brain shouts: “You did not prepare? Uncertainty!! “Not sure how to react??-> Lack of confidence!! Are not confident? ->Output/Result: Sloppy trading decisions and double-guessing!! The market will show you who’s in control and it won’t be you.
So your task as well as the pre-requisite for executing your one trade is to have a long-term & mid-term chart analysis done before the week even starts! But that is not all. You must also prepare yourself emotionally. I am not talking about taking care of your health before the week starts! What I actually want to suggest is that you maximize the probability of you feeling your best during the week that is about to start. Hold on a bit. Let me say that even though you might do your analysis and plan your trades, you don’t know when you will have to execute. It is uncertain! You have made your analysis and have made your plan for your trade but you do not know when the time will be for you to execute your trade. We cannot always predict when price will hit a level you want to enter at. It is uncertain. Imagine having your schedule and daily plans for the upcoming week clear and decided and then the market suddenly reaching a level your entry level is at and you having to react quick. Then Imagine you having a big mess of vague chaotic undecided tentative daily plans and then the market reaching your entry level and you having to react to it quick in the midst of all the riot in your plans. Which is better? This kind of a situation will not only mess your trading and your entry up but will also screw your daily plans up. Two birds with one stone! What a bummer! 😀
And think of the emotional costs and time wasted as well!
The answer? Not only should you do your pair analysis and plan your trade but you should also plan your daily schedule for the upcoming week clearly as well.
The Fruits of Planning
Imagine how it feels to have both a long-term and mid-term analysis for your trade completed. Imagine how it feels to have planned your trade to the minute details in advance. Imagine having a plan B and plan C prepared just in case. Imagine having your daily activities for the upcoming week also planned clearly. Imagine you having to execute a trade now.
Lets us dive into what a nice winner can do to your account. It can show you the proof that if you do what you know you truly want and have to do, the results will come! It might expose to you the real amount of effort that goes into having one solid winner. How can you appreciate the winner? Most certainly, do not trade the profit of your winner that you appreciate this much for some low-grade random trade that you did not plan in advance . It’s the same as asking you how you can appreciate having your amazing wife if you trade her for some cheap slut. Appreciate!
Take one thing at a time, do not overload yourself emotionally. This just creates chaos and unpredictability which is not what you want. It does not matter how many opportunities in the world if you cant hold yourself together as a person and trader. Hold yourself together and keep it tight! Make yourself the priority first, the market second. Manage your time and mental state as a manager! One winner with low risk but Risk:Reward of 1:7 will bring you disproportionate results that are out of this world! ( Or should I say out of this solar system). Risk 1 dollar to earn 7dollars??? Sounds like something we should focus on. Low risk for a high return? That is why we got into trading in the first place. We did not become traders to risk a lot to get a lot. We became traders so that we could spend less time working but have more free time at the same time. We started trading to risk little to gain much!
One loser can blow your account. Or if not, surely one loser multiplied by at least some number will blow your account. One loser can create an addiction to get hold of every opportunity and execute every possible opportunity fast without preparation. One loser might be seductive. If it has the opportunity to hit your ego, if you just can’t accept that you lost this one loser will try to make you prove that you are worthy of having good winners by executing an another stupid unplanned loser (+BONUS: As fast as you can). One loser can make you lose everything, one loser can suck you into a vicious cycle and one loser can make you become insane in disbelief of your misfortune.
One loser can trick you. One loser can blind you.
What do you do when you are blind? You rely on something. When you are doing bad what can you rely on? Your friends & family, your teacher or mentor, your inner spirit, your trading rules and your plan.
The Safety Net
The moment that you have this one loser, its the time for your safety net to start working. What is your safety net for the bad times? What did you have in your inventory prepared for the bad times? Did you make it sure that you are with the right people to support you? Did you set up a plan B and plan C? Did you set risk management and action rules? Did you decide limits that should never be exceeded? Did you increase the probability of you stopping yourself from self-sabotage?
What is in your pocket? Nothing? Or do you have tools & safety nets prepared?
Subscribe to my mailing list HERE