If you’ve been at this for a while…
And you’re putting in the time and effort (but you’re not sure if it’s all making sense)…
Take a deep breath.
It’s okay.
Be aware that you are not alone.
But also be careful, because for some people it’s the most dangerous place to be.
Why?
Because…
You Might Be Closer Than You Think
There’s this crazy book you might have read called “Acres of Diamonds” by Russell Conwell.
It’s about this guy who sells his farm and travels the world in search of diamonds so he can be rich.
He never finds diamonds and ends up dying in poverty.
Meanwhile, the guy who bought his farm finds a huge diamond on the property.
Of course, it’s a parable.
But I can’t tell you how many times I’ve watched people almost give up….
RIGHT before everything clicked.
And it’s uncanny how often they realized that what was missing was right in front of them the whole time.
I’ve had students message me to say they were ready to quit, but one or two small (or BIG) mindset shifts changed everything.
With that in mind, here are 5 positive signs that your trading is on the right track.
You’ll start to know you’re on the right track when…
#1. Process Matters More Than Profits
Every one of my most successful students agree.
Source: Millionaire Media
Once their focus was on becoming a better trader by following a process, their equity curve started moving in the right direction.
And most of them lost for the first one or two years.
But their losses were small and they focused on learning.
It’s not that they don’t care about losing. But losing is less important to them than whether they followed their trading plan.
The same goes for wins.
When you can sit through a day where you took no trades because your pattern wasn’t there, but you did your job right, you’re on the right track.
#2. Your Setup Is Not Every Setup
No trader I know masters every setup.
I have some very dedicated students. Some have learned multiple setups that they trade successfully, depending on the market.
But the best, most profitable traders wait for their setup.
Jack Kellogg only wins 55% of the time and he’s made $26 million. How? He waits for his setups.
Source: Millionaire Media
When he’s right, he’s right. But when he’s wrong, Jack cuts losses quickly (most of the time).
He’s also made some mistakes. But Jack ALWAYS takes time to review and learn from his mistakes.
I always encourage new traders to study the different patterns. Try the patterns in my 7-Step Framework.
But do it to figure out which ones work best for you.
#3. You No Longer Take Losses Personally
One of the best ways to achieve this is to realize that losses are part of trading. But you also have to be able to accept that sometimes you’ll be wrong.
Tim Bohen said something at our recent meetup that comes to mind…
“It’s okay to be wrong, as long as you don’t stay wrong.”
In other words, if you’re in a losing trade, get out. Only ego and stubbornness keeps you in a losing trade.
Stop taking it personally, take the loss, and move on. Hold and hope is not a strategy, right?
#4. You No Longer Fear Missing a Trade
I’ll give you a little spoiler. You are NOT going to capture every single opportunity the stock market has to offer.
If you are glued to a screen for hours on end, day after day, you WILL burn out. If you try to be perfect, it will only make things worse.
So, when you no longer fear missing one, or two, or ten trades because you weren’t glued to your screen, you’re on the right track.
That does NOT mean you can come to the market every day unprepared.
It means you prepare, take as many good trades as you can, and avoid the trap trades.
Find the trades that fit your process. Your job is to be prepared and capitalize on the good setups.
Finally, you’ll know you are on the right track when…
#5. You Look At the Markets As a Whole Before You Check Your Watchlist
This one should be obvious, but I can’t tell you how many new traders lose track.
Roughly 75% of stocks follow the overall market.
So, if the stock market is down because of some big geopolitical event, and you aren’t aware, you could walk blindly into a bad loss.
Likewise, if the market is hot or there’s a hot sector, and you don’t know about it, you could be wasting your time on a terrible stock you have no business trading.
I see this a LOT.
Take a step back and look at what’s going on in the market as a whole.
Is there any big news? Is there something you should be aware of, like a Fed meeting?
Once you look at the big picture first, and it becomes a habit, you’ll know you’re on the right track.
You Can Do This
Whatever you do, don’t give up too soon.
Use the five points above as a way to understand where you are on your journey, and then try to get a little better every day.
Now go study.
If you have any questions, email me at [email protected].
Cheers,
Tim SykesEditor, Tim Sykes Daily
