Your mistakes of trading😼😼😼

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00:00I'm not exaggerating when I say this, if you can somehow manage to not make any of

00:04these 6 mistakes I'm about to share with you, you will instantly become a better trader.

00:09It's important to know how to trade, but it's as equally important to know how not

00:13to trade.

00:14These are the 7 biggest mistakes I see people making when trading, let's just jump straight

00:19into it.

00:20The first and most crucial mistake I see people making is entering too late.

00:24Look, I completely understand why people make this mistake.

00:28It's a psychological emotion that is just embedded in our heads as human beings, and

00:32that emotion is the fear missing out.

00:34If you don't know this already, and you're a beginner trader, you never ever want to trade

00:39with emotion.

00:40It's a lot easier said than done, and if you actually pay attention to all these mistakes,

00:44almost all of them are emotionally driven.

00:46The sooner you stop trading with emotion, the sooner you start making money.

00:51Even the best of the best get caught up in their emotions, every once in a while.

00:55And sometimes it's hard to realize when it's happening to yourself.

00:58But that's just exactly what separates the profitable traders from the unprofitable.

01:02It's just one of the things you slowly get better at as you gain trading experience.

01:07The most often time people trade with their emotions is when they start thinking they're

01:11going to miss out on the party.

01:13I see this happen all the time.

01:15You look at the chart and you spot a really strong resistance line.

01:19You know in the back of your head if the price ever crosses this line, you can be pretty

01:23damn certain the price will go up from here.

01:26So, your initial plan is you want to enter right when the price crosses this line.

01:30Now, when day trading, a lot of the times you're looking at multiple different stocks

01:34at the same time.

01:35You gotta look at screeners, news, different indicators, etc.

01:39And let's say you come back to the original stock that you were looking at, and while you

01:43were looking at some other ones, there was a sudden spike in price, and the price skyrocketed

01:47past the resistance level just as you predicted.

01:50The only thing is, the price is already way above the line, and you're not in the trade.

01:55This is the exact point of what separates a great trader from an amateur.

02:00The amateur would start feeling emotions, thinking if they don't enter right at this very point,

02:05they're going to miss out on so much money.

02:08So they enter as fast as they can, even though the price is way above their initial entry mark,

02:13and they're taking up way more risk entering at a high price like this.

02:16A professional trader would have realized what's happening and just called it a missed

02:20opportunity, and start looking for other and better plays.

02:24Or maybe even wait for a pullback to happen so they can enter at a better price with less

02:28risk.

02:29My point is, if you're late, you're late.

02:31Don't get caught trying to chase the party and get burnt because you entered at the top.

02:35Because most of the time, it's going to look like this, where there was a sudden spike,

02:39you entered late, and it ended up being the top and started falling right after you entered.

02:43Stick to your strategy, stick to your game plan, and don't change it no matter what.

02:47If you missed the entry point, move on to the next opportunity, or be patient and wait

02:51for it to drop to a better price.

02:54Mistake number 2, using too much money.

02:56Let's go over a scenario that I'm sure almost all of you have gone through in your

03:00trading career.

03:01Let's say you initially started trading with $100 per trade, a decent amount for you, but

03:06nothing crazy.

03:07And your trading strategy is actually working pretty well.

03:10You're following your strategy perfectly to a T, and you've been insanely profitable

03:14every single day for the past week, making $500.

03:18Then you get this beautiful, bright idea.

03:20Well, I've been trading with $100 every day, and I made $500.

03:25What if I started trading with $1000 every day, so I can make $5000?

03:29Now let's just say in this scenario, $1000 is a lot to you.

03:32This is an absolute terrible mistake, and I see beginners making this one so often.

03:38Why is this a mistake?

03:40Well, it's pretty simple.

03:41If you're trading with an amount that you're not okay with losing, it's without a doubt

03:44you will start trading with emotion.

03:46Whenever the price goes towards a direction that you don't want it to go, and your balance

03:50starts dropping a crazy amount fast because you're using a higher percentage of your portfolio,

03:55you're going to start freaking out, making you panic sell more often than you normally

03:59would.

04:00Whenever trading with an amount that you're not comfortable with losing, it's almost inevitable

04:04that you will trade with emotion.

04:06Trading is not a get rich job.

04:08It's about growing your account slowly and consistently.

04:11The sooner you realize trading is not a get rich quick scheme, the sooner you will start

04:16becoming profitable.

04:18Mistake number 3.

04:19This mistake I'm sure every trader has made, and it ended up biting them in the ass because

04:23of it.

04:24Not setting a stop loss.

04:26Especially in day trading, you should always be using a stop loss.

04:30There's no reason for you not to.

04:31Even including swing trading and long term trading.

04:34There will always be a point in the chart where you can say, if the price ever goes below

04:38this line, I simply don't want to be in the trade anymore.

04:41It happens all the time.

04:43You see a trade, it looks extremely bullish.

04:45You enter with excitement because you think it's about to go to the moon.

04:48You don't set a stop loss because your emotions of excitement and greed are blocking

04:53your clear thoughts.

04:54Or you're simply too lazy to set one.

04:56You go grab a coffee, come back, and the chart just absolutely tanked within 5 minutes, completely

05:02ruining your portfolio with a massive loss.

05:05And I've even seen it get worse from here, where people think to themselves, well I'm

05:09already here at the bottom, I might as well just wait it out.

05:12Then the stock keeps dropping, and dropping, and soon they absolutely have to exit the trade

05:18unless they want a $5 balance.

05:20There will always be a point on the chart where you don't want to be in a position if the

05:24price goes below that point.

05:26Some of you may like larger stop losses, some of you may like tiny ones.

05:30It doesn't matter how big or small it is, just have one.

05:33This next mistake I see people making is using way, way, way too many indicators.

05:39I know, TradingView has millions of indicators, and you're almost like a little kid in a candy

05:43shop that can't choose which one they want, and they just end up choosing all of them.

05:48Sometimes I'll look at a beginner's chart on TikTok or Instagram or whatever the kids

05:51use these days, and it'll literally look like this.

05:55Where they have millions of indicators, support, resistances, Fibonacci charts, and everything

05:59under the rainbow.

06:00There's absolutely no need for this.

06:03One, you can't even tell what's going on.

06:06And two, most indicators are just momentum indicators, so they're telling all the same

06:10story.

06:11Don't think just because you add 4 successful trading strategies together that it'll make

06:17one mega trading strategy.

06:18That's not how it works.

06:20Use a couple indicators, use one strategy, and keep your chart clean and easy to read.

06:25The fifth mistake is a very easy one to avoid, but yet people still end up making it all the

06:30time.

06:31Trade with the trend.

06:32In basically all my trading strategy videos, they all have a common core strategy, trade

06:38with the trend.

06:39It's pretty simple, you want to buy when the market is going up, and you want to sell when

06:42the market is going down.

06:43I know, it's simple, but I still see way too many people trying to overcomplicate things

06:48and trying to buy the absolute bottom of a market.

06:51They will see a stock that has been dropping for the past month, and they think they figured

06:55it out and found the exact bottom.

06:57What are the chances that out of the past month the stock has been falling, you have found the

07:01exact bottom right here?

07:03If a chart has been falling, it's more likely to keep falling.

07:06If a stock has been rising, it's more likely to keep rising.

07:09Now, you may be asking yourself, how do I know if a chart is in an uptrend or a downtrend?

07:14Well I explain it in depth in a lot of my other trading videos, but I'll give you a quick

07:18explanation.

07:19You get on your trading platform, at a 200 day exponential moving average, if the price

07:24is above the 200 day EMA, it's an uptrend.

07:26If it's below it, it's a downtrend.

07:28It's really that simple.

07:30Now of course every trading strategy is different.

07:32For some strategies an important part of the strategy is buying in a downtrend, or buying

07:37the bottom.

07:38But for the most part you should be thinking, I'm only buying in an uptrend, and only shorting

07:44in a downtrend.

07:45It'll make your life so much easier when you trade with the flow of the market.

07:49The next huge mistake is one that a lot of people miss, and it can be the difference

07:53maker in you fixing your bad habits or not, lack of record keeping.

07:58If you're a beginner trader or even if you've been trading in the game for a long time,

08:02it's always good to keep track of your trades.

08:04You can always improve, always.

08:07It's important to look back at your past trades to see what you did good so you can keep

08:11doing those specific things, but it's also nice to look back at your trades and see what

08:15you did incorrectly.

08:17To help bring your emotions and bad trades under control, it's always nice to have a trading

08:21log where you take a screenshot or even a video of the chart before you even enter.

08:26Write down why you want to enter the trade in the first place, whether it was fundamental,

08:29technical, or from a news article.

08:31Write down the exact point of when you're going to enter the trade, then when you're

08:35going to exit.

08:36This will not only give you a direct plan, which is what you should have in mind before

08:40entering every trade anyway, but it'll also show you if you yourself followed your own

08:45plan.

08:46Once you exit the trade, write down why you exited.

08:48What emotions were you feeling during the trade?

08:50What you did wrong?

08:51What you did right?

08:52Keeping a trading log helps you achieve two goals.

08:55The first is to make money.

08:56The second is to become a better trader.

08:59You might not succeed on the first goal, but you will absolutely succeed on the second goal.

09:03You should always and forever try to become a better trader after each and every trade.

09:08No matter how much experience you have, you can always improve.

09:12Trading reveals your weaknesses that you never thought you had, but it can also make you

09:16a stronger person learning from them.

09:18It's important to learn from your mistakes, not just keep making them.

09:22One of those mistakes is setting your stop loss too high or too low.

09:26That's why in this video I tell you a secret trick that I use all the time to help place

09:31my stop losses in the best spot possible, so they don't get stopped out as much, but

09:36it's still an efficient stop loss.

09:38Go check that out and I'll see you guys next time.

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