When I first started to actively trade just over one year ago, I was always searching for the ‘correct’ way of being a trader. Unfortunately, a single correct way of trading simply does not exist. It took me a while to figure this out as I find that my personality leads me to ensure that I do everything in life, correctly and efficiently. I have often worked at jobs where there is a correct way of doing things which means I had to shift my mindset when beginning to trade.
This article does not explain or help you with your technical analysis (TA). It is touching on one of many factors that are highly important to execute alongside TA.
During this article, I will explain how my time and experience as a trader forced me to adapt and make trading work around my personality and current commitments.
There is no one size fits all
As I touched on in the intro, it’s clear that there is no ‘one size fits all’ when it comes to trading. It is important to understand that every individual has different lives, personalities, situations, commitments, levels of organisation and many more factors that play a part. You simply have to make it work for you and your unique lifestyle.
When I started to trade, I would frequently ask other traders questions such as ‘How often do you look at charts?’ ‘Do you always place bids in advance?’ and so on. The answers from the traders definitely provided value that I could take away, but it wasn’t as simple as me implementing the exact same techniques to my trading. Taking their answers on board is fine, but be flexible in how you apply it to your own style.
It is also important to understand that you will more than likely not find the trading style and routine that works for you on the first attempt. It took me months of trial and error and adaptation to figure out important aspects such as what timeframes work best for me, and my personal entry/exit triggers. Be patient and keep tweaking until you naturally feel comfortable with what you have in place.
How I make trading work for me
Having a segment on how trading works for me can seem redundant as it won’t be the same for you. However, I sometimes feel things are much clearer when I see a ‘real life’ case study to refer to and use as a framework when figuring things out for myself. Use this as inspiration, not as a final way of trading.
As some of you will be aware, as well as trading I have a full time job in User Experience and also run my own project in crypto called elevateUX. It sounds like a lot and to be honest, it is. This is why I have to make specific trading-related decisions based on my personal circumstances.
Firstly, I define myself as a high timeframe, price action trader; let me break that down. High timeframe simply because I don’t have the time to be looking at intraday charts on a daily basis. I am far too busy to keep up which means that high timeframes such as 12H, 1D, 1W (sometimes 4H) work best for me and my daily schedule. However, this doesn’t mean I completely exclude trading on the lower timeframes. For example, if I have some free time during the weekend, sometimes I’ll scan 1H & 2H charts whilst looking for a few quicker trades. Now the price action part; this is because it is what makes most sense to me. I respect many traders who have different styles and use various indicators etc but you have to trade something that actually makes sense to you. It will make things ten times easier in the long run, trust me.
When it comes to executing trades during a busy day, automation and using alerts are crucial to my trading. Every morning I will wake up 1–2 hours earlier than I used to and scan all the charts that I am currently interested in trading. I will set alerts and bids accordingly and head to work. Again, this is just what I find works for me. I am also exploring further automated services such as 3commas which will help me save time but also remove emotion from my trading.
Whether I set a bid or an alert completely depends on the stage of the set up. This could depend on whether it has already broken a key level? Is it on the verge of doing so? Am I super confident in letting my bids fill or would I rather do it manually due to extreme volatility? Something again that you have to figure out for yourself and take on a trade by trade basis.
Luckily I have a job that allows me to go on my phone at almost anytime during the day. This is a privileged position that I have which allows me to respond to alerts relatively quickly. However, because of work commitments, I find myself charting in the morning on my MacBook but actually executing 90% of trades on my iPhone. Many people hate the UI of exchanges on mobile but when you don’t really have a choice, you kind of get used to it.
Those who don’t have the luxury of accessing their phone during working hours may want to consider settings more bids than alerts to ensure they don’t miss their set ups. If I do miss a trade due to being in work, I don’t care. I used to get frustrated that the trade was playing out the way I expected it too, without me having a position. It was painful but over time, I’ve learned to accept that there are always going to be more opportunities in the market.
Once I’ve finished work I will scan the charts again, I will check for new opportunities, check any open positions and just manage trades accordingly. During a weekend I usually find myself playing football and spending time with family and friends as I believe a work/life balance is important. Not just for a healthy lifestyle but for successful trading too. These are all practices and traits that I personally find work for me and my trading.
Organise and discipline yourself
If I have one overarching tip that I found has helped me the most whilst I was figuring things out, it was that organisation is extremely important. I was relatively lucky with this one as I am naturally an organised person but I feel I wouldn’t be able to trade as effectively if I didn’t have organisation skills or more specifically, a routine.
Being organised allows me to reduce stress and anxiety as I always have trades under control. Having a trading journal and a clear set of trading rules allows traders to remove emotion from trading which does require discipline as well as organisation to actually use the journal and rules effectively and consistently. If you have a clearly defined stop loss, target and entry before you even enter the trade, this is also evidence of good organisation which will prevent you interfering with trades, making bad decisions and causing stress.
The bottom line is, if you are organised you are going to keep on top of things much better and make the whole trading process easier which will typically result in an improved performance.
One way or another, your trading style is going to be unique and have different requirements to the next trader if it is going to work. If your friend is an amazing trader, doing it full time and you are only trading part time, there will be plenty of advice and tips you can take from them but you cannot simply copy everything they do. The same applies to your favourite traders on Crypto Twitter. Use them for guidance and not your own rules.
If this aspect of trading is causing you a headache, the best advice I can give is keep trialling new strategies and new trading rules until you know you are naturally comfortable with what you have in place. If you are questioning whether it is right, then it probably isn’t.
There are many more specific attributes of trading that could be included in a similar article but I wanted to touch on the areas that I felt were the most important for me to understand as I matured as a trader. Although not everything in this article will be directly relevant to you or your personal circumstances, I hope that you can take something from it and improve what you currently have in place.
If you have found the article useful, any tips are much appreciated:
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Everything that I have wrote is subject to my unprofessional opinion and nothing should be considered as financial advice. This article has been wrote for entertainment purposes only.