What’s Your Trading Foundation?
Trading can be one of the most challenging and rewarding professions in the world.
Those who dive into trading typically welcome challenges of the lifestyle. They understand the ongoing need for education, consistency of effort, and persistence through trying times. Traders also understand the importance of proper mindset, using the right tools, and following a sound trading plan.
Everything needed by a trader flows into the plan. This allows them to govern their own path in trading, and life, without having to rely on anyone else for financial well-being.
Here are key elements of a sound trading plan:
- Approach and Goals: Are you a day trader closing out setups by end of day or a swing trader holding overnight or for many days? Are you wanting to take gains (or losses) daily or weekly, or maybe hold out for profit potential over months or annually?
- Markets: How will you define the markets in which you will trade, i.e. stocks, futures, forex, or options? Which of these fits your risk assessment — how much you’re willing to risk to maximize gains?
- Tools: What types of setups will you apply, i.e. butterflies, iron condors, spreads, etc.? How much education or live-trading training will you invest in to improve skills? There is much to consider with tools for trading.
Weaved into all of these elements of the trading lifestyle are mindset and commitment.
These alone can build a foundation to improve all other elements of building a profitable trading lifestyle.
A strong trading plan should consider all these elements to be put into practice, and it must allow for you to change and adapt the plan as needed. Markets shift, trading patterns change, and life can suddenly be a world apart from just a few months ago.
It may seem outdated, but you still need to have a plan in place, know and understand that plan, and put that plan into action.
We Saw: stocks tanking with Covid 19 Round 2 threat —
- Restaurants, hotels facing devastation
- Reopening plans creating mixed market signals
- $3 trillion House stimulus proposal
We’re Watching: … signals in key tickers across the board —
- New production cuts in oil
- Real long-term stability in tech sector
- Moves in GOOGL, TSLA, PTON, WORK, LITE
Does it make sense to “see” price moves before they happen? Learn about catching “pops and drops” in a volatile market.