It’s the first week of the new trading year and a lot of traders are excited…
Many analysts are projecting a stock pickers market in 2024 with the major indexes hitting new highs.
It can be exciting to jump into a new market in the New Year — just like people get excited to go to the gym and start their New Year’s resolutions.
But all that excitement can create disaster…
People start off going to the gym every day, but the excitement soon fades and they stop going altogether…
In trading, excited traders can start jumping into trades too early…
They anticipate moves and then get left with losses.
I don’t want a bad start to take you out of the game for good. So today I’m giving you tips to help you avoid overtrading and keep your expectations and discipline in check.
Start your year off with free training — join a live session here!
How to Avoid Overtrading This Month
Overtrading used to eat up traders with commissions and fees … But even with free commission trading, there are costs to overtrading…
It can cost you your mental capital going in and out of trades. Maybe you get out too soon and jump back in and give back some of your gains.
Or you cut losses and the stock dies what you thought so you chase it and end up scalping…
It’s tough to maintain a clear mind and trading plan when you’re jumping around in and out of trades randomly.
Random trades = random results.
So use these tips to avoid overtrading and start 2024 off right…
Track Your Trades
You hear me say this a lot … But tracking trades isn’t just about tracking your profit and loss and the patterns you trade.
You can learn so much from the data you record. And you can use that information to become a better trader.
If you have data on which trading patterns, time of day, and risk to reward are working for you, then you know how to approach the next trade. You can rinse and repeat.
But your data can also show you what’s not working…
If you lose on your morning trades more than you win, focus on afternoon trading. If your win rate is better when you short versus going long, focus on short patterns.
Stick to what works and cut out what doesn’t.
But tracking trades also comes down to discipline…
You have to keep it up every day. A lot of traders struggle to keep their trading journals or spreadsheets up to date.
So consider setting a time each day to do it.
Mark your calendar and set an alarm on your phone … Whether you record your trades right after you take them, after the market closes, or at the end of the day before you go to bed — it doesn’t matter, what’s most important is that you commit to doing it and do it!
Build Positive Habits
The New Year is when everyone likes to make resolutions. But goals are empty wishes if you don’t have a plan to get you where you want to be…
Start a list of habits that cost you trade opportunities or money (your trade tracking could help you with this)…
Then write a list of new habits you want to build.
Now, do something every day to build the habits you want, and get rid of the ones you don’t.
That’s how you get 1% better every day.
When you track your trades and review the data regularly…
And if you write down the goals and habits you want, you’ll be less likely to overtrade.
You’ll be that much closer to having a system and process to follow each day.
Now every day stay focused. That’s how you build the discipline to make 2024 your best year.
Combine your discipline, tracking data, and good habits with the right tools of the trade — and you can be unstoppable…
See how the right tools can help you fine-tune your trading timing during our free training sessions.
We’ll show you how to find hot stocks every day, the news behind the moves, and how you can nail down your timing with the right entries and plans.
The next session starts soon — sign up now to join!
Have a great day everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade