When I first started trading 17 years ago, I didn’t know a fraction of what I know today.
There was no StocksToTrade or IRIS and I didn’t immediately discover Tim Sykes’ Trading Challenge (the course that would eventually change my trading career forever).
In the beginning, I was young, impressionable, and naive…
I didn’t have a coherent strategy. I joined sketchy trading chat rooms run by “gurus” with no proven track record. And I paid the price with brutal losses.
If this sounds familiar, it’s time to pay attention…
I would pay a pretty penny to get in a time machine and re-trade my early years in the market.
Of course, that’s impossible for me. It’s too late to go back and start over on day one.
But depending on where you are in your trading journey, it might not be too late for you to start in the right place…
Last week, I shared four tips I wish I had known when I first started trading.
Today, we’ll finish the list…
Only Trade Hot Sectors
I say it all the time in Pre-Market Prep…
“Hot sectors, hot sectors, hot sectors!”
I wasted a lot of time in my early years of trading by trading lukewarm sectors, trying to force trades in pockets of the market that weren’t already rip-roaring to the upside.
But I’ve learned my lessons…
Throughout my time as a trader, I’ve seen so many different “niche” sectors come and go…
- In the early 2000s, any stock with “.com” in the name was going parabolic…
- In 2017-2018, electric vehicles were red-hot…
- During the 2020 pandemic, meme stocks and work-from-home related software names went haywire…
- And these days, artificial intelligence is creating a whole new bull market in mega-cap tech…
- Speaking of AI: Check out one of the most advanced and lucrative swing trading advancements of the decade
You see, there’s always a hot sector in the market. ALWAYS.
So there’s no reason to expose yourself to opportunity cost by trading anything else.
Learn from Losses and Mistakes
Taking losses hurts, there’s no denying that. But they’re an unavoidable part of trading.
At some point, you will take a painful loss just when you thought your position was about to blast off.
It happens to the best of us…
But losing in the stock market can actually be a positive catalyst for growth.
It’s about radical self-honesty.
If you aren’t honest with yourself about your trading mistakes, it’s nearly impossible to avoid those errors in the future.
Go over your recent losses and zero in on the worst aspects of the trades.
Track your trades, take detailed notes of what you find, and then make a promise to yourself … to never make the same mistakes again.
Stay Informed (and Adapt to Market Changes)
Staying informed about market trends and adapting to changes is key for successful trading.
Financial markets are always changing because of things like the economy, politics, and global news.
As a trader, you need to keep up with these changes and adjust your strategies when needed.
Regularly read financial news from reliable sources to understand the market better.
(StocksToTrade Breaking News Chat can help keep you up-to-date on the biggest market catalysts BEFORE the news guys hear about it…)
Follow updates on important economic indicators like interest rates, job data, and inflation reports since these can affect market movements a lot.
Also, keep an eye on major world events that might impact the markets.
Join Daily Income Traders to learn new trading techniques and tools. Engaging with our incredible intraday trading community can give you new ideas on how others are dealing with market changes.
It’s also important to review and adjust your trading plan regularly. What worked in a rising market might not work in a falling one.
By continuously analyzing your strategies and being open to change, you can better respond to different market conditions.
Nurture Your Mind and Body
Trading is a mental game.
But your mind and body are more linked than most people think…
Prioritize self-care by getting enough sleep, engaging in regular exercise, and adopting healthy eating habits.
It can be easy for traders to find themselves sitting in a chair staring at a screen for 9 hours a day … but this is a trap.
I don’t know a single multi-millionaire trader who sits on the couch watching Netflix or playing video games all day.
You should take short breaks during market hours to relax and recharge. Go for a walk and get some fresh air.
Additionally, develop techniques to manage stress effectively and engage in hobbies outside of trading.
Example: I love to hunt and fish. It’s a great break from the markets for me to get out in nature.
By taking care of your mind and body … you can potentially improve your focus, productivity, and overall performance.
Have a great day everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade