Three phases of a Successful day Trader

There are three different phases of any successful day trader’s life. Every successful day traders have followed the same path and became successful. All these three phases are followed by an idle phase. let me explain it ......

Phase-1: Phase one is the most excitement phase. In this phase a trader starts his trading journey with no or limited knowledge. Takes trade blindly or someone's recommendation. makes a few profits and a Hugh loss in the market. Remember that maximum number of traders enters into the market during a bull run. This time almost every alternative day market creates a new high.

During this phase he believes on market gurus, friends, recommendation providers, news anchors etc.

This time the trader thinks he will be able to make hell lot of money and he is the smartest person on the market. But his believes turned into a nightmare when the market starts consolidating and gives a little pull back. Noe the nightmare becomes darker day by day and he thinks that he will not able to make money from the market and losses almost 50 to 60 % money on his capital.

Eventually he quiets the market after 1 and half years keeping a promise that he will never ever take entry again. This time maximum loss and minimum profits happens.

Most of the retail traders (almost 95%) quits stock market after phase-1, those who enters phase-2 makes money lifelong.

Phase-2: After few months when the market is taking reversal, and the market is in the news again. he starts watching news. Trying to understand market behaviours, gathering knowledge, understanding the stop loss mechanism, Risk to reward, money management, understanding the speculation and the news. Basically, during this phase, he tries to gather knowledge on the market and try to do the trades himself. He also does not repeat the same mistakes what he has already committed during phase 1.

But this time also he is in limited profit and limited loss zone. during this phase he has lot of knowledge but very little profit. He tries to find out the answers of all of his questions spends more time in studies. this process continues for another 2 years and he enters into the third phase slowly.

Phase-3: This is the ultimate phase, this time the trader understands technical and fundamental analysis. He is able to capture the write trade, understands his own emotional behaviours. follows his rule, stop loss management, trading journal, understand the market dynamics. Keeps away from biasness and makes unlimited profit and limited loss. But the trader tries to improve himself every day. Study and analyse the market everyday basis and keeps it up for the rest of his trading journey.

Analyse your current position and try to move from one phase to another phase. Improvement is the only key to success.

Keep improving and happy trading.

Comments

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