A few of these lessons that I will be talking about won't be directly related to trading an actual stock. I feel like trading is a lot more than technical analysis, functioning algorithms, and exact patterns (at least in this niche anyway). The human mind is a huge deciding factor in these trades, thats what makes them so volatile and profitable. 

1) Learn to take mental breaks

I do this a lot. I have since I was sixteen. And I'm not talking about taking a break. I literally drive myself crazy doing something when I set a goal. this is the first semester I didn't take more than 20 credit hours since I was 16. It has gotten me far, but at a great deal of stress. Most people can't function like this and if you put yourself on overdrive 24/7 you will burn yourself out far quicker. Your mind needs time to digest the process that take place that day, give it that time. Hence my break. I had an explosive start. I've studied every day and posted pretty much near every day for 20 or so days. I've watched HTMM and I'm almost done with part deux. Always invest in your education, I guarantee your losses and mistakes will be cut down by thousands if you learn to prevent those mistakes before hand. 

2) Understanding the purpose of the movement

If a stock is moving up or down for no reason, theres no reason to trade it. The only way we can become consistent traders is if we minimize our risk, if we don't know why the stock is moving, we risk a lot by not having a catalyst. If the stock is moving, you have to justify that move. Look for indicators to justify this such as technical breakouts, volumes, news, contracts, earnings, investor buys, etc. Check the disclaimers, check for scams. Understand the trade and when the stock moves to your target, your execution will be exponentially more profitable. 

3) Past performance is indicative of future performance (sorry Warren) 

Past chart patterns are a very good indicator of how the stock will do at certain points and different parts in the pattern. Always be on the lookout for huge stock mover indicators such as billionaire wins and investor plays, as we learned in $KBIO a company on the way out can be pumped 1000% percent over a few hours. If the stock spikes then has a huge downtrend, and the stock is currently spiking, ALFS, and be prepared to execute a short. It would be a silly mistake to chase the stock thinking it is going to keep up trending, when past performance has shown otherwise, it's about to hit a major crash. (assuming the news is good enough move to provoke a spike). 

4) Use technical analysis in conjunction with fundamental analysis to truly minimize risk

Technical analysis works for only so many plays if you just use it alone. Its risky to not consider the fundamentals in trades because things such as news, earnings, and wins because these will cause changes in patterns. the usual downtrend after a huge spike may continue to spike. Vice versa.

5) Learn to love the grind

Watching dvds and reading articles everyday isn't fun. It definitely isn't appealing. But this is why so many fail at trading and why we must continue to learn and teach ourselves even when it doesn't feel good. This is what wills separate us from the 90%. 

6) If you're spending more money trying to trade than you are on education to learn properly, your doing it wrong

Always invest in your education. With everything. I see so many people take unnecessary losses. My losses have all been small. Ive always learned more than what I lost which what made those trades worth the 20 dollar losses. Why in the hell are you going to lose 2k trying to learn the same lesson? Until you invest entirely in your education, you cannot become a successful trader.

Its monday tomorrow, back on the grind in the stock world. Im mid rotation at EMS, I may or may not be able to post to the blog. Happy trading!