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Day Trading: 5 Steps to Shorten Your Learning Curve
We all want to KNOW things that we don’t already know. But do we really want to spend the necessary TIME to actually LEARN these things? Best Selling Author and motivational speaker Brendan Burchard really drives this point home in the following video:
1. You have to know what you want of your life before you become a master learner. If you don’t know what your goals are or dream life should look like, you don’t know WHAT to learn and, worse, you won’t be COMMITTED to truly learning it. Advanced learning requires clear focus and a definitive WHY for learning - without these, you won’t stay disciplined enough to learn anything with real depth.
Take time to envision your life as a successful trader. It is easy to envision yourself working 4 hours a day making big money as a trader. I invite you to read an article series “Faulty assumptions with Day Trading”.
Now that you have a more realistic idea of what it takes to be a successful trader, take 10 minutes with no distractions and imagine your desired life with a trading career
2. Avoid starting from scratch. With no model to begin from - no example or strategy you are following - you’re reinventing the wheel and doomed to waste time. So, what proven framework, person, strategy, or step-by-step instruction are you following in order to learn this new area?
For 7 years I failed at trading. In hindsight, I know exactly why I had struggled for so long. I used that benefit of hindsight to develop a model to help others not only know WHAT they need to learn, but HOW to learn it. If you want to be successful, follow those that have already done the work for you. (link to FF info and/or the FF whiteboard video embedded here)
3.Make a PRACTICE of mastering skill sets. A practice is a recurring habit or routine that deepens your skill in any given area. The important thing here is to make a daily practice of anything you truly want to learn. Without daily exposure and immersion in the area you are trying to learn you will never achieve mastery. Learning must be an everyday discipline.
PRACTICE PRACTICE PRACTICE. We all know that it takes practice to become skillful at something, yet many fail to apply this knowledge to trading. Traders tend to have a faulty assumption or expectation that they can trade for a couple of hours and then take the rest of the day off until the next trading session. Truthfully though, trading is a skill, and just like any skill, it takes practice. With a market replay utility and a model to help you learn faster and more efficiently, you’ll see results from your practice sessions almost immediately! All those wasted hours you spend on blogs, trading forums researching new systems, downloading free indicators, spending time doing trade room trials, could be spent practicing with intention. Knowing that your practice will definitely have a payoff at the end. I often use sports analogies when I speak about trading. Traders need to the of trading hours is GAME TIME. Game time is not the time to try new trade setups, strategies, indicators, or trading styles. This applies even if you are trading in simulation mode (not real money or paper trading). If you want to try something new, do it away from game time with a structured learning and practice program. You will be amazed at how much faster you will progress with your trading.
I often compare trading to sports. Trading hours is game time. Game time is not the time to try new strategies, indicators, etc… even if you are in SIM. If you want to try something new, do it in market replay and practice it for hours. You will be amazed at how much faster you will progress if you practice your trading.
4. Get feedback. As you begin something new, all leaps forward, all major advancement, rests on getting immediate feedback and direction. Learning is a social process, so ask other people for suggestions and direction as you move forward so you can adjust your approach.
Become accountable for your trades. Ideally you have somebody to go over your trades with you. If you don’t, then each night go over your trades and write down what was good and what was bad. Make it visual. Do it on chart images of the trade. This means ALL TRADES, winners, losers, and those you should have taken but didnt. I offer a mentoring program or “Rx Program” where each participant is assigned a coach. The coach never has more than 2 clients and is in constant contact with their traders. The coach reviews every single trade and sends a report with detailed information about each trade. They do this DAILY. I created this because I know how important and beneficial it is to be held accountable for your trade decisions. In fact, being accountable makes you a better trader IMMEDIATELY.
I know it’s tempting to tell yourself “I am in SIM and I just wanted to see what would happen”. Well, you need to stop trading like that. Review every single trade you take after the trading session. You will start to see patterns that will help you become a successful trader.
5. Have a deadline. Without a timeline for developing your competencies, you’ll never act or you’ll fall off track. No deadline means guaranteed distraction. So, WHEN do you need to learn this new topic or reach the next level of skill? What’s the consequence if you don’t learn it by then? Knowing the answer to these two questions will accelerate your learning.
Just like with trading, You need a target. Set a date, set a realistic win percentage you would like to achieve, and get to work!