Finance | Side Hustle

Only Two Things You Need to Learn to Trade Successfully

These are the only two skills you need to master to be a successful trader. Read until the end for a third skill that will ultimately make you rich.

1. Know When to Enter and Exit

• Even when you FOMO in and chase, you can still exit for a small scalp.
• If your entry was poor and dipped down to the next support level, you can still exit when price rises back up to test resistance for breakeven or close to it. Rather than holding through another reversal to a new low, or worse holding til expiration.
• Like anything in life, you need to know when you’ve overstayed a situation. A relationship, a job, friends.

2. Control Your Emotions. Know when you are feeling greedy or fearful.

Know thyself. Trading is some Shaolin monk Jedi shit — you have to understand yourself and master your tendencies fully until you can truly be successful. Do you throw fits of rage after one bad mistake? Or can you rack up several mishaps in a row calmly before you crack and smash something?

KNOW WHEN YOU ARE IN FULL TILT

Full tilt mode has blown up so many nice gains and accounts. Recognize it, shut it down for the day, and come back tomorrow. The market will always be there.

That’s it. Trading is basically 80% mental/psychological, 15% execution, and 5% stock/chart knowledge.

“But Drew,” you protest. “What about fundamentals, technical analysis, and charts??”

You don’t even have to know anything about a company or it’s stock to make money in this game. If you can learn to recognize one chart pattern or set-up consistently, then you can spam it ad nauseam to infinity for beautiful profit. This isn’t Street Fighter where spamming Haduokens is frowned upon and shows a lack of skill.

Go do some basic research on chart patterns and candlestick patterns. Then look for your Flying Wedge or Swinging Gate or whatever set-up that you like and are able to make tour bread and butter.

I remember coming across a post from a trader who found a stock years ago, that would trade in a 10 point all day, every day. It’s chart pattern looked like a sine wave. Apparently, an algo was manipulating it on low volume — buying at the low support and selling at the high resistance. A rinse and repeat cycle. So him and a buddy hopped on and traded with it for a while making super easy money. Until one day the hedge fund or firm that was running the algo changed its script or removed it. The tactic no longer worked, the play was dead.

3. One Last Thing That Will Make You Rich

60-yard bombs into the end-zone for the touchdown are sexy and exciting. But going for Hail Mary trades will blow up your account faster than, um well, you can say a Hail Mary.

Steady 3-yard runs up the middle will still result in a first down. True, it will take longer to score but you will develop consistency. And small consistent wins while preserving capital will make you rich in this game.

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