As a country manager I get asked this and other trading questions daily. My position also means that I get to watch both successful and not so successful traders over the shoulder.
Now, despite my experience, I can’t write a clearly defined recipe for success. I can, however, give you a list of some activities that many profitable traders have in common.
Before starting to trade, the procedure should already have been thought out. General considerations that you should be making are:
The more you define the rules in your trading plan, the better control you have over your success and risk. It’s your money & risk management system that will help you to strengthen your trading plan, and you’ll then be able to specify the exact entry & exit level.
As Jack D. Schwager so delicately put in his bestseller, ‘Market Wizards’- “Successful traders are more concerned about not losing their capital than making a profit.”
Create the perfect environment that’ll help you avoid distraction and focus on your trading.
Apart from your technical equipment, you’ll need a broker as a partner that suits your trading style. For example, if you’re a scalper, you’ll need an environment with low-spreads and fast execution.
Make a daily note of your performance in your trading diary and evaluate your trades.
If you realize that there is a big gap between the current state and your intended goal, you should tailor your strategy where it has weaknesses.
Important: Discipline is the alpha and omega. Loss is inevitable if you do not stick to your own trading plan. Adhere to your predefined draw down and your limits, which are compliant with your Risk & Money Management.