Trade The Journey

Trade The Journey

Is Trading Exciting?

I have to admit that I’m a bookworm, and I read about all things regarding trading. Trading attitude and strategy go together. You can’t have one without the other if you want to be successful in trading.

I liken trading to any other goal you may have in life. I think about Micheal Jordan shooting jumpers in an empty gym for repetition without fanfare or cameras capturing it. He shot the same jumper a thousand times and then practiced the same move a thousand times. Over and over, he’d practice making the move a natural process; mastering the process of the movement allowed him to be creative.

Maintaining this discipline assisted him in performing at his best for most of his career. He’ll go down in history as one of the greatest players to play the game of basketball.

Many books repeat the same message using different terminology and concepts; trading is complex yet simple. The learning curve is steep, and the time required to succeed varies.

 

Motivated by the thought of financial freedom, I found trading to be exciting and liberating. I approached the market with a gunslinger mentality. After a string of profitable trades, I began believing my hype.

I continued to trade and do quite well, and then it happened, I had a large drawdown. I wasn’t placing any stops because I believed a stock would rest before drifting further downward. My trading experience up until that date validated that perspective.

 

My first large loss was the first of a series of losses. Some of my trading losses were originally profitable trades before they turned into losing positions. Others trades were doomed from the start.

It isn’t easy admitting you’re wrong, nor is it comforting to know that my money is now in someone else’s account. That’s the cold reality of trading.

Take a couple of losing trades in a row, and the excitement starts to fade. Soon you’ll realize, as I have, that trading isn’t about having fun; it’s about making money. In fact, some of my best trades had nothing to do with excitement. They were successful trades because I prepared daily by identifying reference levels and how the stock traded around those levels.

Consistently preparing for the abundance of trading opportunities is hard work; if you aren’t passionate about trading, this could be a discouraging statement.

 

A lot of people were lucky and I am sure a lot of people lost money. Going against the crowd isn’t natural and least of all comfortable. Unable to fight the crowd, I joined in and brought a small amount of dogecoin, which has paid off so far. However, I don’t consider this to be a serious trade.

I got lucky. It’s the same luck I had when I first began trading. My luck is fading, and now I have to rely on my trading skills.

Instead of working on identifying the perfect trade, I work on managing my trade perfectly, so I don’t have to rely on luck.

To do this, I have to perform my end-of-day analysis and plan for the next day by identifying my continuing risks and evolving profit targets. Some of the risks to the trade are apparent, and other risks are hidden. Hidden risks require critical thinking to uncover, and even then, you may fall short.

Great trading takes practice, experience, and a continued effort. Great trading, I’ve often heard, is boring but with the click of a mouse, you can find yourself in a highly profitable trade. Rely on the “Click of the mouse” mentality for a year or two, and you’re trading career will be finished.

I practice my entries, trade management, and exits by paper trading. I then practice my strategies with small positions with real money on the line.

Over and over, I practice and then document the results in my journal.

After my fifth year, I feel as if I am just beginning. Whether you trading stocks or crypto, trading takes effort and unfortunately, it isn’t always exciting. If you truly enjoy trading, you will enjoy the process of mastery.


Cash-Flow Management Review:

I’m doing a bit better managing my cash flow this week than in previous weeks. I only ate out once and kept my discretionary purchases to a minimum.

Cash Flow Grade: C+

Reason: I still have existing credit accounts open that need to be paid off.

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