The bulls are back in town…. Or are they?
Even if a bull market is back don’t start getting over excited as that doesn’t mean that profits are there for the taking without putting in hard work and consistent focus.
The rules of the game never change, though they can sometimes be easier than at others.
You must first identify a high probability setup, then put in place a plan that you then execute. You have to be patient while the markets move to the required points and then ensure you get in and out at the right points to turn a profit.
However, more often than not things don’t go as smoothly as the plan would imply, and you have to deal with setbacks. This is just as so as markets go up as when they go down so you need to be prepared and put in the required level of work and focus to manage your risks as far as is possible.
Remaining motivated is the hard part. It is true that a bull market is better at providing motivation as there are more opportunities, or the opportunities are more evident. A sideways market can be dispiriting if not careful as the unpredictability adds an additional level of stress, fear or concern.
However, with the current movements shifting the markets upwards there should be enough to get you positive and motivated that there is a potential to make profits. The key is to ensure you turn as many carefully planned trades as possible to gain from the profitable trading period.
Now is the time to zone in and focus and believe you can take advantage in the shifts whilst keeping a close eye on your risk management and ensuring you don’t’ get over confident. The over confident trader starts to believe that they are invincible and that the markets are going to keep delivering profits without the need for detailed plans or analysis. This is a dangerous approach.
This leads to pointing out that whilst there is a need to trade enough to set the odds in your favor, there is a risk of over trading. Over committing on the number of trades and putting yourself in a situation with either the total amount of capital at risk at any one time is more than you can handle, means that you can’t focus on any one enough to manage your plan and be ready to react to any market movements.
This is setting yourself up for failure and there is a high probability that you will significantly reduce your profit taking in the process. So be realistic in your goals and acknowledge what is your limit and work to that. Persistence over time is the key to success, not a quick turn around on too many fronts.
This persistence is what sets the successful trader apart from those that fail to make profits in the long-term. No matter what the condition of the market you have to be in it to make it work in your favor. Certainly in some economic times it is sensible to back off the volume of trades but only with persistence and focus on the markets and investing in opportunities on a consistent basis will you make profits.
Ensuring that you acknowledge all your achievements and not just the trades that deliver a profit will help you remain encouraged and believe in your ability to be a successful trader. You will then be ready for when the real bull market returns and even greater profits become possible.
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