As some friends were requesting to teach trading so I took Google meet class last week, you will get the answers of your questions from the class notes i m pasting below, hope it will help everyone here:
Trading is 80% psychology
humko loss book karna sikhna hai, most traders don't book loss, first learn to book loss
even best traders too have 60-65% win rate, so will you, 90-95% win rate is fraud, you will be correct only in 60-65% time be ready to know and accept it, before putting your next trade on
trading is game of mathematics, you lose smaller and win bigger so you are net profitable over a series of trades
risk max 1-2% capital per trade
trading strategy: trend following, keep this as simple as possible
how to find a trade/trend: do multi time frame analysis/top down approach D, H, 5 min. and let market confirm levels of support/resistance/demand/supply
find key levels from daily chart, the levels from where market pivoted multiple times means bulls/bears entered/exited at those levels, but trade at those levels
from 5 min. time frame after confirmation by market
use confluence: wait for multi confirmations by price action, volume, top 5 bid ask/market depth and OI data, when different factors confirm it, then take the trade
when your level/strategy is not respected by market, your trade thesis fails, accept it and exit with small loss or SL hit, if in profit let profit run
if not booked small loss, will convert in big loss and account will be blown
stop loss move to cost once in profit properly, later can trail also
profit risk reward book in 1:2, 1:3 don't chase unrealistic targets
Trading = risk management, actually what we are doing is risk management but is called trading
slowly grow the account, if you try to become rich fast from trading its guaranteed that you will become poor fast
technical trading strategy: ema 5, vwap crossover (5 min. time frame)
slow,fast moving average crossover ema 8, 20/34t (1, 5 min. time frame)
most important: max 2 trades per day, Over trading and greed is the biggest enemy of a trader, if daily target achieved in 1 trade no need of 2nd trade
slippage(over trading cost, brokerage, taxes) will eat you, avoid over trading, or it will take away profits of profitable trades also
1 lac capital, trading rules:
maximum daily loss: 2000
dialy profit target: 3000
maximum loss limit: 10,000
profit monthly target: 20,000
daily 0.5% profit target for beginning trader, increase slowly with time and consistency, it will give you so much peace & satisfaction and help build confidence in your trading
after 10+ years of research found the only secret sauce/holy grail of trading is: patience and discipline
withdraw profit regularly and put in long term investment
positional trade: Delivery, volume, price all three: weekly, monthly breakout for positional trade
over confidence will kill you, be aware, a series of winning trades does not mean you will never lose, be careful
if a series of losing days happen, take a break, refresh come back after some time
trading is psychologically difficult, train the mind before jumping in trading
stop fire fighting with market, it will hit you psychologically and cost wise
NLP: use Neuro linguistic programming ,use affirmations to program the subconscious mind for trading for 1 month repeat affirmations every hour to program the subconscious mind for trading
first 1 year learn everything properly and then increase lot size, trade 1 year with lowest quantity to learn it
