Here are the ten key things I have learned that have allowed me to make money in the markets, and some of the characteristics of the best traders I know.
- The ability to buy pullbacks in uptrends. Buying at the right pullback levels while everyone else is afraid is typically profitable.
- Selling strength short at key resistance levels during downtrends. The ability to sell short after a big move inside a range bound or down trending market can be profitable with the risk/reward ratio is in your favor.
- Top traders use stop losses and limited position sizing to control their risk per trade. They never risk all their capital, their lifestyle, or their careers on any one trade.
- Top traders are flexible and can be bullish or bearish at any given moment, depending on the price action and market trend.
- Top traders like to trade in the path of least resistance in their time frame, always going with the flow.
- If you want to be a top trader you have to love to trade. Just wanting to make money is rarely enough motivation to do the work necessary to be successful.
- Top traders do thousands of hours of homework on historical charts and price action trends to see what actually works.
- Top traders HATE to lose money so they keep their losses small.
- Top traders maximize their winning trades and minimize their losing trades.
- Top traders don’t give up when they are exhausted and beaten down, they only stop when they have won.