They Have No Game Plan!!!
This is an important element in trading and one that should not be brushed to the side. When you have a game plan it allows you to get in and out of the market in a non-emotional way.
So often I see new traders jump into the markets based on emotion, hearsay, and rumor. This is the worst possible way to trade and the quickest way to lose all of your money.
In my humble opinion, nothing is more important than a game plan and sticking with it.
By creating a game plan, you are setting yourself up to be prepared emotionally. No matter what happens to a particular stock or futures market, you have a pre-planned way to enter and exit the market. Having a successful exit strategy is enormously important.
With the kind of volatility that we are seeing in the marketplace today, having a game plan has never been as important as it is right now.
Creating a game plan is very easy and you can do in a matter of minutes. Here are the key steps to creating a very basic game plan:
1) Write down your reasons for buying or selling a particular market.
2) Write down your entry point for the market you're about to trade. Why are you getting in? Did you see a technical set up?
3) Write down when you are going to exit this market. Why and when are you going exit? Was your profit target reached, or were you stopped out?
4) Do not make market decisions during trading hours. It may sound easier said than done, but watching the daily ticks can cause your emotions to go haywire.
5) Review your game plan every day to see if things are going according to your plan. This allows you to adjust your money management stops and your target zones in a non-emotional way.
It couldn't be easier and it's only costs is a sheet of paper and some of your time.
So there you have it ... five easy steps that can both make you money and save you money in the future.
Every success in training and in life,
Adam Hewison
President, INO.com
Co-creator, MarketClub
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Gary Anderson is a thirty-five year market professional. He is a principal of Anderson & Loe, Inc., a firm that provides technical consulting services to an international clientele of banks, mutual funds, insurance companies, hedge funds and independent advisors. Gary has published articles in Technical Analysis of Stocks and Commodites and is regularly quoted in the Wall Street Journal and Investors Business Daily.
