The common theme throughout the Master Trader’s Class is that in order to become a successful trader you must develop good habits that result in solid routines that you follow religiously, this puts you in the right mental state, and you must trade with an edge.
- Develop a trading routine. This is much more than the things you do around Entry and Exit events, this is about developing a litany of habits designed around your lifestyle and trading activities. These habits are focused on helping you perform in a consistent manner, with the best state of mind, strategy, information and environment.
- The next thing is journaling, you need to journal and tag every trade you make, making sure to record all aspects of the trade so that you can develop statistical information and identify your edge.
- Over time you are going to realize that certain trades are your go to trades. These should be noted as your favorites, and recorded as such. Some might refer to these as your playbook trades. They should be well documented with narratives and context.
- Focus on trading those playbook trades that have the best edge you have discovered. The trades that provide you with the best return on capital, both monetary and mindful capital.
- Rate your trades in terms of your execution of your strategy, not necessarily how much you made. Be critical of your execution and approach to the trade. Note whether you capitalized on the setup and if there were any aspects to the trade that might open new opportunities for Playbook trades. A retrospective and evaluation, followed by a plan to improve your routine is imperative.
- Make sure you communicate with others in the trade room your ideas, and analysis of the current assets in play. And ask Don or my opinion on how you approached the trade.
- And above all, practice patience in your trading. Understand that this is a learning experience, whether you are a novice or seasoned trader. Every day is a new day with something to learn, and your performance will be determined by the consistency with which you act, day in and day out.
A structured trading routine is absolutely important, but without edge you’re just spinning your wheels. So you must find trades and strategies that have edge and exploit them. And conversely, a trade with a definable edge won’t make you consistently profitable unless you approach that trade with discipline, patience, readiness and knowledge.
I won’t lie, it’s a fact that some people are successful with what appears to be no structured routine, and just pure intuition. These people are the exception, they exist, but they are the extreme minority, and their example cannot be prescribed or copied. It’s theirs and theirs alone.
These people are super in tuned with the markets, and seem to have a second sense that gives them the edge. They have talent, and you may also have that kind of talent, latent within you. But in my experience, the best way, the most reliable way to expose that talent is to first improve upon your basics, your fundamentals. And the best way is through developing great habits, leading to a structured routine and finding and trading with edge.