Set Yourself Up for a Profitable Trading Year in 2019

As 2018 draws to a close, it’s as good a time as any to reflect and take stock.

Perhaps a time to reflect on your own share trading. And see what lessons can be learned from the year.

In fact, reviewing past trades is something you should do more than just once.

That’s because new insights always come to mind as we learn about markets. And it’s only armed with those new insights that some of those past trades start to yield their lessons.

The market will give you the lessons you need to learn. And will continue to give you the same lessons until you’ve learnt them.

It’s the same for life really.

As you review your trading for the year, go easy on yourself. Don’t use the market as a vehicle to beat yourself up. There are no mistakes, only learning experiences. Just see what you can learn from it, what you can do better next time.

When you review your trading for 2018, you may come to find you fell victim to overtrading.

It’s very common.

And it really is one of the easiest ways to crash and burn in markets.

Knowing when not to trade is important.

Overtrading, in my view, has less to do with the number of trades. I don’t suggest putting a limit on the number of trades you make for the year. If you’ve run into a purple patch, putting on good trades, why would you want to limit that?

You just have to be mindful and know when the tide might be turning is all.

We’ve all had the experience of building up a good run of profits, only to give it all back to the market. It’s a very common story.

Well I’m going to give you a strategy to deal with that. A technique to use next year. See if it doesn’t make a difference to your bottom line in 2019. [openx slug=inpost]

 

The simple and effective trading strategy for 2019

As soon as you make two or three wrong trades after a long series of profits, stop trading. Get away from the market and take a rest. Take a complete break from juggling positions and plotting your next move.

When you feel refreshed and think you’re right again, make a start on a small trade. If that first trade goes against you, you should quit again and stay away.

Then when you start again, if your first two or three trades turn profits, you can then keep trading further and expect a period of success. Trade until you see another sign that the market has turned against you. Then you must get out of the market once more.

Employ this strategy and you’ll avoid one of the biggest trading pitfalls in 2019.

And while we’re reflecting on the year just passed, use this time of year to think about your most valuable asset.

Your health.

The choices you make about your diet, exercise and sleep will affect the energy levels you have for trading, and for the rest of your life. If your energy levels are low, you will not perform at your best, trading or otherwise.

Many of us try and function on less and less sleep, but in the long run that isn’t conducive to good decision making.

Exercising every day and getting enough sleep helps create a high-energy state, which is essential for focused trading.

There’s one more thing I can mention that can set you up for a more successful trading year in 2019.

In fact, it’s the most important thing.

And it’s something all the trading books leave out.

Your trading psychology.

Read the books that will help you do the work on your yourself. Your own mindset.

The market is simply a mirror and will reflect back to you your own mindset.

That’s why you need to do the work on yourself.

Become aware of your inner talk. Because your inner conversations don’t recede into the past, but rather confront you into the future.

Anyway, there’s a few things to think about and use to make 2019 a more profitable trading year.

I’m looking forward to bringing you more market insights in 2019.

But until then, I wish you all the best for Christmas, and good trading in 2019.

Terence Duffy


Terence Duffy is an analyst and chartist, specialising in researching economic trends and cycles.  His primary focus is housing and land affordability. But you can also depend on him to offer his unique analysis of stock market charts. As Terence will show you, the charts often forecast, well in advance, the good or bad news to come.


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