"Buy low, sell high" - everyone who has ever dealt with the trading of cryptocurrencies* or shares has heard that saying. It means buying the traded asset cheaply and then selling it for a higher price. Sounds easy, doesn't it? Unfortunately, however, this strategy is not as simple as it sounds. Because at what time should you buy, when should you sell? There are also psychological factors such as emotions that influence the trading process. To prevent this, we are going to explain the three most important rules of trading to you today.
Rule # 1: risk management
Rule # 2: Trading Journal
A trading journal is comparable to a diary. But instead of writing down the day's events, you document your daily trades. What went well? What didn't go so well? That can help to avoid bad decisions and get better at future tradesby showing your own mistakes. In the long term, this helps to find your strategy. It can also help counter one of the biggest weaknesses in a trade: emotions.
Rule # 3: trading plan
Now you are going to learn that a fixed trading plan is a must have to be able to trade successfully. Especially for traders who have problems with their emotions in the market, a trading plan should be part of their daily trading routine. Professional traders put their plan on paper and put them on the wall, ideally right next to the screen. This way, you are always reminded of what to stick to.
Be in the trading plan Entry, exit and clear goals defined. When do I go into a trade? When do I exit a trade? Where are my take profits? The implementation of these points means that you only enter into trades that are within the plan. For example, a trade where you run into a stop loss is not a bad trade as long as it is within the given schedule. A loss should not always be considered a loss.
Learn trading with Cryptory.de
If you prefer to watch the most important rules of trading in the form of a video, we can recommend our partners from Cryptory.de, from whom the above tips also come. Georg von Cryptory briefly and briefly explains the most important rules in the video below. If you want to learn more about trading and work on the market in the long term, you should definitely subscribe to the YouTube channel. Notice: as our partner is from germany, the video is in german =)
Photo credit: pixabay.com | CC0
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