8 Rules That Changed my Trading Forever

Summary

In this video, the speaker shares eight essential trading rules drawn from years of experience and studying top traders, aimed at helping traders become consistently profitable. Key rules include learning from mistakes without repeating them, avoiding attempts to call market tops and bottoms, trading only with high confidence in the daily chart, limiting trades per day, and prioritizing risk management. Additional advice emphasizes the importance of journaling, managing trades based on market structure rather than emotions, and maintaining discipline. The video also highlights strategies for day trading, improving profitability, and resources for prop firm funding and structured trading education.

Takeaways

• 😀 A mistake is fine, but repeating the same mistake is unacceptable. Track errors, detach your ego, and learn from them.
• 😀 Avoid trying to call market tops and bottoms; follow the current market structure instead.
• 😀 Only trade when confident about the daily chart's direction, focusing on high-probability setups.
• 😀 Limit your trades: ideally 2 per day, but if struggling, reduce to 1 per day or 3 per week to focus on quality.
• 😀 Risk management is crucial: never risk too much on a trade; consistent low-risk percentages prevent account blow-ups.
• 😀 Manage trades based on market structure rather than moving stops to break-even for emotional reasons.
• 😀 Journaling trades is essential for identifying mistakes, reviewing performance, and improving consistently.
• 😀 Discipline underpins all success: without it, you'll overtrade, mismanage risk, and fail to follow rules.
• 😀 Be okay with being wrong; if a trade doesn't happen or goes against your prediction, it's not a loss if risk was managed.
• 😀 Focus on patience and clarity: trade only when probability is in your favor and your bias is clear.

Q & A

Why does the speaker say making a mistake once is fine but repeating it is unacceptable?

Making a mistake is part of the learning process. Repeating the same mistake indicates a failure to learn and adapt, which directly leads to unprofitability in trading. Journaling helps identify and correct repeated mistakes.

What is the risk of trying to call market tops and bottoms?

Attempting to predict tops and bottoms often results in trading against the prevailing market structure, which increases the likelihood of losses. Profitable trading focuses on following confirmed market trends rather than guessing extremes.

Why is it important to only trade when confident about the daily chart direction?

Trading without confidence in the daily chart direction reduces the probability of success. Traders should stack probabilities in their favor by entering trades only when there is a high-confidence setup, typically over 70% certainty.

What is the recommended maximum number of trades per day and why?

The recommended maximum is two trades per day to ensure focus on high-quality setups. If results are poor, limiting to one trade per day or even three trades per week can help maintain discipline and avoid low-probability trades.

How does proper risk management contribute to long-term profitability?

Proper risk management, such as risking only 1% of the account per trade, prevents account blowouts, reduces emotional stress, and ensures traders can survive losing streaks, ultimately enabling consistent profitability.

Why should traders manage trades based on market structure rather than moving stops to break even?

Managing trades to break even is often an emotional decision that can cause missed profits. Managing based on market structure ensures trades are aligned with the actual price action, increasing the likelihood of capturing larger gains.

What role does journaling play in improving trading performance?

Journaling allows traders to review their trades, identify mistakes, understand patterns, and improve decision-making. Without journaling, mistakes are likely to be repeated, hindering long-term profitability.

How does discipline influence a trader’s success?

Discipline ensures adherence to rules such as risk management, trade limits, and journaling. Without discipline, even a skilled trader will make repeated mistakes, overtrade, or act emotionally, preventing consistent profitability.

What should traders do if they are unsure about the market direction for the day?

If a trader is uncertain about the market direction, they should refrain from trading. Being okay with not knowing prevents unnecessary losses and preserves capital until a high-confidence setup appears.

How does limiting trade frequency improve results?

Limiting trade frequency focuses attention on high-probability setups, reduces emotional decision-making, and avoids low-quality trades. This practice increases the likelihood of profitable trades over time.

Why is it more important to follow probability stacking than to predict market outcomes?

Probability stacking focuses on entering trades where the statistical likelihood of success is higher, rather than guessing market tops or bottoms. This approach reduces risk and improves long-term profitability.

How does the speaker justify following these rules based on personal experience?

The speaker has applied these rules to achieve nearly $1 million in personal trading and helped students secure over $40 million in funding with $900,000+ in payouts, demonstrating the effectiveness of disciplined trading strategies.