You can do everything right… Spot the setup, time the entry, even nail the execution…
And still walk away with nothing to show for it.
Worse?
You take a winning trade… and somehow, it ends up a loser.
Speaking of winning trades, are you using my Monday Setup yet? If not, you’re missing out big time.
Here’s how it works…
Every Monday, the market kicks back into gear after its weekend nap… and that reset creates a unique opportunity.
As the first session of the week gets started, there’s a specific pattern we look for that appears again and again with uncanny consistency.
And it has delivered some unbelievable gains!
Look at this massive winner from last Monday…
After announcing a major blockchain deal, Maison Solutions (NASDAQ: MSS) skyrocketed over 600%*!
We hunt for these kinds of Monday morning spikes every single week.
Now it’s time to learn how to spot them for yourself…
Watch the video below for the full trade breakdown and strategy tutorial on my Monday Setup.
If you continue finding yourself holding the bag on stocks that were once big runners, you’re not alone…
There’s a reason it keeps happening…
One of the biggest and most costly mistakes new day traders make is that they have no idea how to manage their profits.
I’ve watched it happen hundreds of times. A trader nails the setup, times the entry perfectly, and is sitting on a great winner…
Then they let it slip away.
They give it all back, sometimes even turning that winner into a full-blown loser.
Today’s market is fast, but it can also be volatile and unforgiving. If you don’t have a plan for locking in profits, you won’t last long.
Want to know exactly how to trade the fast-moving tickers?
Join me every morning for Pre-Market Prep when I walk you through the best patterns, explain how to trade them, and answer your questions live.
My daily Pre-Market Prep session is available exclusively to Daily Income Trader members.
Learn more about DIT during one of our free daily webinars.
With DIT, you’ll also get our Oracle tool, three other daily live sessions, trade alerts, and much more.
Master your trading game with Daily Income Trader.
Today, let’s break down the top five mistakes I see traders make when it comes to managing profits, and more importantly, how to avoid them.
Table of Contents
Mistake #1: No Risk Management Plan
Let’s start with the most important skill every trader must master: risk management.
Most people are using way too much leverage.
U.S.-based brokers will often give you 4x margin. And offshore brokers? I’ve seen 10x and higher. It sounds great… until it isn’t.
Leverage is just borrowing money to try to amplify your gains. But just like in real life, borrowing cuts both ways.
I like to use this analogy: If you had $300,000 in your bank account, would you spend it all on a house?
Of course not. You’d keep a cushion.
But every day, I see traders with $3K in their accounts leveraging up to $300K on a single trade. That’s clearly insane.
If it works? Great….
But if it doesn’t? Your account’s gone. You’re wiped out.
The same leverage that multiplies your gains can just as easily multiply your losses.
Mistake #2: Going All In On One Trade
I don’t care how good the setup looks. Never go all in.
Even with a cash account (which, by the way, I recommend for newer traders), putting all your buying power into one trade is just asking for trouble.
Here’s why:
- You’re too aggressive
- You have no flexibility for new opportunities
- News, tweets, or random world events can crush you
You want high-conviction setups, sure, but remember, anything can happen.
And if you’re fully committed to a single trade, you’re handcuffed. You’re gambling, not trading.
Even if you’re trying to scale your account quickly or beat the PDT rule, betting everything is the fastest way to blow it all up.
Mistake #3: Not Keeping Losses Small
The Golden Rule of trading: Keep your losses small, and stick to your plan.
This is what separates long-term traders from those who disappear after six months.
Too many people get greedy. They see a stock go from $1 to $45 in a day, and suddenly they think every trade should be a home run.
That’s how you turn a winner into a loser.
You need to be agile. Set your stop-loss before you take the trade, get in and out quickly, take the win, and move on.
Mistake #4: Not Knowing Your Risk-to-Reward
A proper risk/reward ratio is your best friend.
Many traders say they’ll risk 50 cents to make 50 cents. Then they’re up $2 a share… and they’re still holding. Greed wrecks traders.
You need to define your profit targets before you enter the trade, not after.
If you’re risking 50 cents, aim for $1.50. That’s a 1:3 risk/reward ratio, which is what I use. When you hit that target, immediately take the win.
If the stock blows past 1.50, great. But don’t get greedy, take the profits and walk away.
Mistake #5: Trading Without a Mentor
You need someone in your corner who’s been through it.
I’ve been in the trenches for almost 20 years. I’ve been through it all.
And guess what… I had a mentor, too.
A mentor helps you avoid dumb mistakes and builds your confidence when things get tough.
If you’re serious about becoming a consistently profitable trader, find someone who’s lived through the big runners. Learn from their experience.
Don’t ever go it alone.
My Final Thoughts…
I’ll leave you with this analogy because it’s one I use all the time…
Trading is like flying a plane. If you’ve trained, practiced, worked with a mentor, and logged time in the simulator, you’ll be ready when it counts.
But if you just open a brokerage account, jump into a trade, and “see what happens”?
You’re going down. Hard.
Trading isn’t playing the lottery. It’s a skilled trade, just like being a coder, an electrician, or a pilot.
Stick to your plan. Take your profits. And stay in the game.
That’s how you make it today and survive for years to come.
Have a great day, everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade
P.S.
The government just set this sector on fire. Here’s my watchlist.
24-Hour trading could soon be a reality. How will you handle it?
Think you’re on top of all the financial news? Think again.