The 25 Point Discipline For Day Trader - #17 And #18

I continue my post about The 25 Point Discipline For Day Trader. And below is the 17th and 18th point.
 
#17 NEVER TAKE A BIG LOSS.ONLY A BIG LOSS CAN HURT YOU.
Please review rules #5, #8, #10, #11 and #15. If you follow any one of these rules you will never violate rule #17.
Big losses prevent you from having a winning day. They wipe out too many small winners that you have worked so hard to achieve. Big losses also "kill you" from a psychological and emotional standpoint. It takes a long time to get your confidence back after taking a big loss on a trade.

The 25 Point Discipline For Day Trader - #15 And #16

I continue my post about The 25 Point Discipline For Day Trader. And below is the 15th and 16th point.
 
#15 LOVE TO LOSE MONEY.
This rule is the one that I get the most questions and feedback on by traders from all over the world. Traders ask, "What do you mean, love to lose money. Are you crazy?"
No, I'm not crazy. What I mean is to accept the fact that you are going to have losing trades throughout the trading session. Get out of your losers quickly. Love to get out of your losers quickly. It will save you a lot of trading capital and will make you a much better trader.

The 25 Point Discipline For Day Trader - #12, #13 And #14

I continue my post about The 25 Point Discipline For Day Trader. And below is the 12nd, 13th and 14th point
 
#12 DON’T HOPE AND PRAY. IF YOU DO, YOU WILL LOSE.
When I was a new and undisciplined trader, I can't tell you how many times that I prayed to the "Bond god". My prayers were a plea to help me out of a less-than-pleasant trade position. I would pray for some sort of divine intervention that, by the way, never materialized. I soon realized that praying to the "Bond god" or any other "futures god" was a wasted exercise. Just get out!

The 25 Point Discipline For Day Trader - #9, #10 And #11

I continue my post about The 25 Point Discipline For Day Trader. And below is the 9th, 10th and 11st point
 
#9 EARN THE RIGHT TO TRADE BIGGER.
Too many new traders think that because they have $25,000 equity in their trading account that they somehow have the right to trade five or ten e-Mini S&P contracts. This cannot be further from the truth. If you can't trade a one lot successfully, what makes you think that you have the right to trade a 10 lot?
I demand that my students show me a trading profit over the course of ten consecutive trading days trading a one lot only. When they have achieved a profitable ten-day period, in my eyes, they have earned the right to trade a two lot for the next ten trading sessions.
Remember: if you are trading poorly with two lots you must lower your trade size down to a one lot.

The 25 Point Discipline For Day Trader - #7 And #8

I continue my post about The 25 Point Discipline For Day Trader. And below is the 7th and 8th point
 
#7 BE YOURSELF. DON’T TRY TO BE SOMEONE ELSE.
In all of my years as a trader I never traded more than a 50 lot on any individual trade. Sure, I would have liked to be able to trade like colleagues in the pit who were regularly trading 100 or 200 lots per trade. However, I didn't possess the emotional or psychological skill set necessary to trade such big size. That's OK. I knew that my comfort zone was somewhere between 10 and 20 lots per trade. Typically, if I traded more than 20 lots, I would "butcher" the trade. Emotionally I could not handle that size. The trade would inevitably turn into a loser because I could not trade with the same talent level that I possessed with a 10 lot.
Learn to accept your comfort zone as it relates to trade size. You are who you are.

The 25 Point Discipline For Day Trader - #5 And #6

I continue my post about The 25 Point Discipline For Day Trader. And below is the 5th and 6th point
 
#5 YOUR BIGGEST LOSER CAN’T EXCEED YOUR BIGGEST WINNER.
Keep a trade log of all your trades throughout the session. If, for example, you know that, so far, your biggest winner on the day is five e-Mini S&P points, then do not allow a losing trade to exceed those five points. If you do allow a loss to exceed your biggest gain then, effectively, what you have when you net out the biggest winner and biggest loss is a net loss on the two trades. Not good.

The 25 Point Discipline For Day Trader - #3 And #4

I continue my post about The 25 Point Discipline For Day Trader. And below is the 3rd and 4th point
 
#3 ALWAYS LOWER YOUR TRADE SIZE WHEN YOU’RE TRADING POORLY.
All good traders follow this rule. Why continue to lose on five lots (contracts) per trade when you could save yourself a lot of money by lowering your trade size down to a one lot on your next trade? If I have two losing trades in a row, I always lower my trade size down to a one lot. If my next two trades are profitable, then I move my trade size back up to my original lot size.

The 25 Point Discipline For Day Trader - #1 And #2

I continue my post about The 25 Point Discipline For Day Trader. And below is the first and second point
 
#1 THE MARKET PAYS YOU  TO BE DISCIPLINED.
Trading with discipline will put more money in your pocket and take less money out. The one constant truth concerning the markets is that discipline = increased profits.