3 Ways To Improve Your Trading This Summer

As traders, we are always looking for a trading edge, but sometimes we can overlook the big picture and miss how we can change some fundamental ways in which we approach and make trades.

For myself, one of the key elements is to be disciplined in one's trading. I must say that it’s easy to say, but, it did take me quite some time to master this skill.

Often you want to justify your position, and you listen to someone else who thinks the same way you're thinking, even though you both could be wrong on the trade. When you follow that line of thinking you are doomed, as you tend to keep pointing to the other person and use them as a crutch for a trade that has gone bad. This can create bigger and bigger losses for your account so, much so that it freezes your brain to the point you can’t see other market opportunities. It also gets to the point where you say to yourself, "I’ve lost so much money I can't get out now." This is not the attitude to have if you want to be successful. The good news is there is an easy cure for that, and you must follow it if you are going to be successful.

The one easy cure for this is using stops in the market.

I used to listen to Ron Popeil pitching the Ronco 4000 Showtime Standard Rotisserie on TV and the keywords he always used to say after you put the chicken is was “Set It And Forget It."

I'm not sure if Ron Popeil ever traded in the markets, but his concept of “Set It And Forget It” can be applied to stops. Simply enter your stops and leave them there until either you are stopped out, or you have taken a profit on the position.

You can still take a profit on a position even if you get stopped out… You simply keep moving your stops up as the market moves higher. Doing so helps you lock in a profit when the market reverses. So use Ron Popeil’s “Set It And Forget It” philosophy for your stops. It could be the difference between eating chicken and having nothing to eat.

The other key thing to trading is to trade with the trend. Perhaps this is one of the oldest truisms in the market and one of the most valuable. If the trend is bullish then, you want to trade from the long side of the market. Conversely, if the trend is bearish you want to be out on the sidelines or trading on the short side of the market.

Going against the trend is like trying to catch a falling knife. Yes, it is possible, but is anyone that dumb? So do yourself a favor this summer promise yourself that you are only going to trade with the trend and take a disciplined approach to it.

One of the best ways to incorporate both of these simple formulas and achieve success is to create a game plan. Here you write down what you think of the market, the reason you want to buy or sell that market and where you are going to put your stops if you're wrong.

By creating a game plan, you simply put down on paper or in this case in your computer, exactly what your thoughts are about a particular market. So often we see traders get caught up with the excitement and emotion of the trading day and make silly trading errors only to see later that their original game plan was right. It can be frustrating as well as a blow to your confidence. You can avoid this with a simple game plan. It's a simple solution to what can be a complex problem. Better yet, it works, trust me on this one.

Every successful trader I know or have ever met when I was trading on the floor of the exchange in Chicago or London or Switzerland practiced some form of a game plan for their particular market. So if they can do it - you can do it!

So remember, write it down, you'll be glad you did, and you will be rewarded with solid profits.

So there you have it, three simple ways for you to improve your trading this summer:

1. Be disciplined
2. Trade with stops and don't take them out
3. Create a personal game plan that you can refer to.

Lastly, I am confident if you follow these three easy steps and hone in your trading skills this summer you will have just learned one of the greatest ways to improve your trading at no cost. You have also made one heck of a good investment in yourself, and I guarantee that these three simple approaches to the market will make better trader.

Every success with MarketClub,
Adam Hewison
President, INO.com
Co-Creator, MarketClub