How I Would Learn Day Trading If I Could Start Over (Lessons From A 30-Year Trading Professional)

Summary

Raie, a seasoned trader with three decades of experience, shares invaluable insights on how to approach trading the right way. Reflecting on early mistakes, Raie emphasizes the importance of starting small, learning with a mentor, and mastering consistency before scaling up. He stresses the value of a structured trading process, including journaling, reviewing trades, and focusing on the right strategies over profits. Key advice includes using prop firms as a funding vehicle and avoiding generic courses. By prioritizing discipline, market analysis, and a long-term mindset, traders can move from beginner to consistently profitable.

Takeaways

• 😀 Trading is a long journey, and the first few years can be tough. Mistakes and losses are part of the learning process.
• 😀 Prop firms offer a powerful opportunity to trade with someone else's capital, but only if you're consistent and have mastered the basics.
• 😀 Before jumping into prop firm evaluations, spend 6-12 months in demo trading and use a small live account to build discipline and gain real money experience.
• 😀 Avoid trying to learn everything on your own or taking generic courses. Having a mentor who can guide you and provide feedback is essential for growth.
• 😀 A good mentor should provide live trading proof and match your trading goals (e.g., futures vs stocks). Always check their track record before committing.
• 😀 Don’t underestimate the value of the demo phase. Use it to build habits, mindset, and technical skills that will later protect your capital.
• 😀 Focus on higher timeframes like 4-hour or daily charts while learning, as they allow for better decision-making compared to faster timeframes like 1-minute or 5-minute charts.
• 😀 Always set your stop loss before entering a trade, and make it a habit to follow your rules consistently to avoid emotional trading.
• 😀 Journaling your trades is key for improvement. Track your losses, analyze your winners, and review your trade setups regularly to identify patterns and blind spots.
• 😀 Trading is about mastering the process, not focusing on immediate profits. Celebrate losses that follow your rules, and detach from constantly checking your P&L.
• 😀 Success in trading requires four non-negotiables: smart funding, learning from proven experts, obsessive journaling, and total devotion to the trading process over profits.

Q & A

What is the primary reason the speaker would approach trading differently if starting from scratch?

The speaker would approach trading differently by focusing on learning the skills first with small stakes, practicing on a demo account, and only progressing to a prop firm evaluation once consistently profitable. This strategy aims to avoid losing money and gambling away life savings during the learning process.

How does trading a prop firm account differ from trading with a personal account?

Trading a prop firm account provides access to a larger pool of capital, which can result in significantly higher profits, even with the same skills. For example, a $100,000 account could yield $8,000 to $9,000 in profits with the same 10% gain that would only produce $50 in a $500 account.

What is the biggest mistake beginners make when using prop firm evaluations?

The biggest mistake is rushing into a prop firm evaluation before mastering consistency. Many traders spend large amounts of money on evaluation fees without first proving their ability to trade effectively in demo accounts or small live accounts, which often leads to failure and loss of confidence.

What role does a mentor play in a trader's development?

A mentor provides crucial guidance and feedback, helping traders avoid common mistakes and refine their strategies. Unlike courses that may offer general information, a mentor can spot emotional or psychological issues, such as overtrading or revenge trading, and help correct them in real time.

Why is the demo phase important, and how should it be approached?

The demo phase is vital because it helps traders build essential habits, develop the right mindset, and master the technical aspects of trading. To use it effectively, the speaker recommends following a five-step framework that includes reviewing past trades, studying winners, and journaling emotional responses.

What timeframes should a beginner focus on, and why?

Beginners should focus on higher timeframes, such as the 4-hour or daily charts, as these allow for more thoughtful decision-making and reduce the chaos associated with faster, lower timeframes like the 1-minute or 5-minute charts. Higher timeframes give traders more breathing room to make rational decisions.

What is the significance of setting a stop loss immediately when entering a trade?

Setting a stop loss immediately ensures that traders have a clear risk management strategy in place before the trade moves against them. This simple step prevents traders from getting distracted and losing control of their trades when fear or greed set in.

What are the key components of the speaker's five-step framework for the demo phase?

The five-step framework includes: 1) A Sunday ritual of reviewing losing trades to identify patterns and emotions; 2) Studying winners and evaluating risk-to-reward ratios; 3) Creating a folder of the best setups for visual reference; 4) Keeping a simple journal to track trades and emotions; 5) Conducting a deep dive on the first Sunday of each month to identify and fix recurring mistakes.

How does emotional management impact a trader's success?

Emotional management is critical because it directly influences decision-making. Traders must separate their emotions from their trades to avoid mistakes such as overtrading, cutting profits too early, or holding onto losers too long. Mastering this aspect is key to becoming a consistently profitable trader.

What is the importance of studying market structure and confluence in trading?

Understanding market structure and confluence helps traders identify high-probability trades. By analyzing trends across multiple symbols and identifying key levels of support, resistance, and volume, traders can increase their chances of success. This is opposed to trading random setups without context, which is akin to gambling.