Have you ever felt like this -‘I’m a good trader, but I can be an even better trader’? If you’re the type of person who looks for endless opportunities to improve your performance, this article can help you.
Don’t average down, Average up!
Averaging down is an age-old unsuccessful technique. The new-gen traders average up. They add to their winning positions and squeeze the most out of their best. Say you have entered a setup at the breakout with your usual lot size. And it moves in your direction, validating the breakout. You might be in profit, but you know there is no stopping it for the next 100 miles. So why not add more to your winning position? You can prefer this validated setup over a new trade. Or use your idle money and make more bucks. It is what winners do.
Failure to act
You have to be spot-on in your decision-making. A delayed decision tends to be the wrong decision in the market. Consider the market is in support and you expect it to move up. But you wait for it to move up to a level to render confirmation. While this may be prudent, it also turns the risk-reward against your favor at times. So you got to strike when the iron is hot.
Trade to the situation
There are different phases in the market- Trend, consolidation, and choppy. You have to approach each phase differently. When the market is volatile, you can trade with a low lot size but with a wide stop. But you cannot do the same in a sideways market. Instead, you have to go for a bigger lot size for the range top to bottom or vice versa. Further, you ought to realize which phase the market is in quickly too.