If I Wanted to Become a Profitable Trader, here’s what I’d do

Summary

In this video, the speaker outlines a three-step process for becoming a profitable trader. The first step emphasizes mastering market direction, focusing on daily and 4-hour timeframes. Step two introduces market maker models, teaching how to execute trades based on market structure. The third step highlights the importance of daily forecasting and feedback loops for continuous improvement. The speaker stresses that success in trading requires consistent practice, patience, and a clear focus on direction and execution, offering a method to achieve profitability through disciplined forecasting and strategy.

Takeaways

• 😀 Mastering the direction of the market is essential for becoming a profitable trader. If you can't consistently predict market direction, your trades will be inconsistent.
• 😀 Focus on two key timeframes: daily and 4-hour charts. When both align, it increases the likelihood of a profitable trade.
• 😀 The core of successful trading is understanding market maker models, which describe the market's movement based on buy and sell protocols.
• 😀 To execute successfully, always identify whether you are in a buy model or a sell model, based on the higher time frame and market reactions.
• 😀 Consistent forecasting is critical. Before every market open, decide what you want to happen and forecast the market's direction and key levels.
• 😀 The execution of your forecast matters more than the immediate outcome. Whether it’s a win or loss, focus on sticking to your forecast and improving execution.
• 😀 Trading is about developing a feedback loop. After forecasting and executing, assess how well you followed your plan, not just the outcome.
• 😀 Repetition is key to refining your trading strategy. Over time, as you notice patterns in your forecasting and execution, your results will improve.
• 😀 Trading requires dedication and consistent effort. It took the trader three years to become profitable, underscoring that success doesn’t happen overnight.
• 😀 The feedback loop is central to growth. Forecasting, executing, and reviewing results daily allows for continuous adaptation and improvement in your trading.
• 😀 Trading isn’t supposed to be easy. Success requires hard work, mastery of the fundamentals, and staying focused on the right aspects of trading.

Q & A

What is the first step to becoming a profitable trader according to the script?

The first step is to master the direction of the market. This involves forecasting the market's movement on the daily and 4-hour time frames. Once you consistently predict the market's direction correctly, you’ll have a solid foundation for profitable trading.

Why is mastering the market direction considered foundational to trading success?

Mastering the direction is crucial because if you can't forecast the market's direction accurately, your trades will be inconsistent. Inconsistent forecasts lead to poor risk management and an unpredictable trading strategy, which can prevent profitability.

What are market maker models and how do they relate to executing trades?

Market maker models are trading structures that show how the market moves. They include buy and sell models, depending on whether the market is in a buying or selling protocol. Understanding these models helps traders execute trades in alignment with market movements.

What is the difference between a market maker buy model and a market maker sell model?

A market maker buy model occurs when the market hits a higher time frame key level and begins to move bullish, signaling an opportunity to execute a buy. A market maker sell model happens when the market reaches a higher time frame point of distribution (PD array), and it starts moving bearish, signaling an opportunity to sell.

How can traders ensure that they are on the right side of the market (buy or sell model)?

Traders need to master the market direction on higher time frames (daily and 4-hour charts). Once these are aligned in the same direction, they can confidently identify whether they should be executing a buy or sell trade based on the market maker model.

What is the role of forecasting in the trading process?

Forecasting allows traders to predict where the market is likely to go before each trading day. It helps traders determine their targets and expectations, allowing them to execute trades more confidently and with a clear goal in mind.

How does the feedback loop work in the trading process?

The feedback loop in trading consists of forecasting, executing, and evaluating how well the trade aligns with the forecast. The key is not to judge the outcome based on profit or loss but based on how closely the execution followed the forecast. This cycle improves consistency and helps traders refine their strategies.

Why is consistency in execution important for becoming profitable?

Consistency in execution is critical because it ensures that traders are following their strategies accurately. If the execution is inconsistent, even with a good forecast, the results will be erratic, preventing profitability.

What should traders focus on during their daily forecast?

Traders should focus on identifying where the market is likely to go first (short-term movement) and where it will go after that (long-term movement). By forecasting these points, traders can set clear expectations and be prepared to execute trades accordingly.

What is the ultimate goal for a trader to become profitable, according to the speaker?

The ultimate goal is to continuously focus on the right things: mastering market direction, executing trades in alignment with that direction, and using the feedback loop to improve. Over time, the repetition of forecasting, executing, and evaluating will lead to profitability.