Achieving longevity in the futures marketplace is no easy task. Yet, for those traders who do, eliminating variables is a big part their success. Being detail-oriented, willing to learn, and maintaining a positive mindset are all personal attributes exhibited by a majority of winning traders.
In order to become a successful futures trader, excelling in these three areas is important. In this article, we’ll look at a collection of routine habits that promote competent trading every single day.
Winning Traders Stay Positive
To say that a futures trader will face regular adversity is an understatement. On a daily basis, winning and losing trades are tallied, with the result being a gain or loss of capital. Make no mistake, account drawdowns can put anyone’s will to the test.
The thought of losing money makes most working individuals cringe. However, for anyone who wishes to become a successful futures trader, it must be viewed as a part of doing business. Here are a few things that successful traders do to stay positive in the midst of capital loss:
- Employ a daily stop loss: Putting a hard dollar on how much money can be lost in a given session gives structure to risk-taking. Knowing the maximum amount of financial damage to be sustained, albeit an unpleasant thought, is reassuring.
- Reflection: Personal reflection after every trade, or trading session, is a key part of gaining closure and moving forward with an unbiased mindset.
- Physical stress management: Regular exercise is great way to blow off steam after an involved day in the market. Physical exertion promotes both short-term and long-term mental well-being.
Of course, each trader has unique personal habits and tendencies. However, staying positive through promoting a healthy body and mind is a daily ritual for a majority of successful traders.
The Learning Never Stops
Like a graduate student working toward a Ph.D., an active futures trader is always involved in building the trading account. A big part of that requires constantly evaluating performance, market behavior, and the news of the day. In short, the quest to become a successful futures trader involves ongoing study.
Winning traders are like a sponge, always soaking up information about trading the market in real-time and in hindsight. Observing price action during trading hours, as well as studying historical data sets can help in developing strong trading strategies. Also, documenting the market impact of current events and breaking news items is a big part of understanding today in preparation for tomorrow.
The Devil’s in the Details
Being prepared and organized are two extremely common characteristics of modern successful futures traders. In the days of the open-outcry auction system, a gunslinger mentality could lead to a seven-figure annual income. Many people ran into the pits with handfuls of cash and ideas, coming out with big money. In the age of the digital marketplace, a trader is well advised to exercise caution while being as meticulous and detail-oriented as possible.
On a session-by-session basis, successful futures traders dedicate significant time to the following practices:
- Premarket preparation: Identifying market state, as well as key technical levels and relevant fundamentals, ahead of time is useful for trading fast-moving markets.
- Live market evaluation: Watching and documenting market behavior as it unfolds is a common practice among profitable traders.
- Post-market recap: Putting to bed wins and losses properly in anticipation of the coming session is an integral part of generating profits over the long-run.
- Journaling: Keeping a detailed account of emotions and trading results is a regular part of many winning trader’s daily routines.
The futures markets often appear to be filled by uncertainty and driven by randomness. Because of this ambiguity, most winning traders attempt to eliminate as much of the guesswork from the market as possible.
To become a successful futures trader you must know where you are going and remember where you have been ― and never make the same mistake twice!
Become a Successful Futures Trader
Perhaps the best way to succeed in the futures markets is to take time out and talk to an experienced professional. For more information on futures and what it takes to achieve your own personal degree of success, check out a free consultation with a member of the Daniels Trading team.