You cannot do this and be a successful trader

BellaGeneral Comments

Last Friday as I was walking off our trading floor, a beaming SMBU student yelped at me, “Bella I could hug you after today.”  He was very pleased with the progress he had made as a trader.

Fast forward to today and that same trader caught me hitting the elevator for my walk home.  I asked him how trading went for him today.

He said, “Bella as good as I did last Friday, I did as poorly today.  I just did not have the discipline to enter my trades at the price that I wanted.”

I am going to write something now, for which you must follow no matter what product or time frame you trade.

You cannot become a successful trader if you do not enter your positions at excellent prices!

You cannot ever become a big trader.

You cannot ever become a consistent trader.

You cannot ever become a sustaining trader.

Shark does this so well on our desk.  Team Shark members marvel at his trading technique with, “Shark will not enter a position at a bad price.”  He will just let the trade go if he does not get his entry price.  He trades big.  He trades consistently.  Fast forward ten years and he will be trading on a trading desk, if he so chooses.

This is not an issue of discipline for traders.  This is an issue of survival.  This is an issue of trading technique.  The trading technique of the skilled trader is: we do not enter, save at excellent prices.  It’s not a trade if we cannot enter at excellent prices.

If you catch yourself entering at forced prices, at prices that are not where you want, just understand you are developing habits and employing a trading technique that will not allow you to be successful long-term in the pursuit of trading.  Instead of saying, “I was not discliped”, when you enter at a bad price,  say, “I will not be a trader if I continue to enter at poor prices.”

That is a more accurate statement.  That is the trading truth.  And it is just poor trading technique that cannot be employed if your goal is to win.

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*no relevant positions