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Technical Analysis, Trading Psychology and Risk Management

1. The document provides advice on risk management, trading psychology, and strategies for consistently profitable trading. It emphasizes maintaining a consistent risk-reward ratio, proper position sizing using a risk tolerance sheet, and updating capital every 40 days. 2. Key aspects of trading psychology discussed include being self-aware, having patience and waiting for market confirmation, managing fear of missing out by not trading in advance and having late entry, strictly following stop losses and targets, and taking responsibility by learning from mistakes. 3. Additional tips include avoiding hope, greed, and changing stop losses or targets just because of what you think, monitoring P&L only after 40 days, making and sticking to exit plans, and stopping social

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Mohd Faraz
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383 views4 pages

Technical Analysis, Trading Psychology and Risk Management

1. The document provides advice on risk management, trading psychology, and strategies for consistently profitable trading. It emphasizes maintaining a consistent risk-reward ratio, proper position sizing using a risk tolerance sheet, and updating capital every 40 days. 2. Key aspects of trading psychology discussed include being self-aware, having patience and waiting for market confirmation, managing fear of missing out by not trading in advance and having late entry, strictly following stop losses and targets, and taking responsibility by learning from mistakes. 3. Additional tips include avoiding hope, greed, and changing stop losses or targets just because of what you think, monitoring P&L only after 40 days, making and sticking to exit plans, and stopping social

Uploaded by

Mohd Faraz
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Download as docx, pdf, or txt
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TECHNICAL ANALYSIS, TRADING

PSYCHOLOGY AND RISK MANAGEMENT


Risk Management
1. Risk reward ratio
Keep it constant personally suggested by Afzal 1.3

2. Position sizing
using sheet keep risk tolerance 1%
Update Capital every 40 days

TRADING PSYCHOLOGY
READ THIS EVERY DAY BEFORE MARKET
OPENS
1. A consistently profitable trader is always self-aware

PATIENCE
2. The stock market is a device for transferring money from the
impatient to the patient – Warren buffet

3. The good speculator always wait and have patience, waiting for the
market to confirm their judgment – Jesse Livermore

FOMO (Fear of missing out)


1. Don’t trade in advance
2. Late entry

FEAR
Use Risk management effectively
Do not trade if you can feel like you if lose money
GREED
Strictly follow stop loss and target (DO NOT CHANGE IT NO
MATTER WHAT YOU THINK)

HOPE

OBSERVATION

STREAK
1. Loses leads to fear
2. Gain leads to over confidence

TAKE RESPONSIBILITY
(Learn from mistakes and follow Risk
Management)

MONITORING P&L
(monitor only after 40 days to boost your psychology)

STOP SOCIAL MEDIA & DIVERGANCE


Make your exit plan and stick to exit plan
(Exit plan – SL & Target)

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