We found ourselves discussing this in the Elite room today. It is so very important to get your head “in the game correctly” to be a consistently profitable trader. This is good to review daily before you begin to trade.
From “Trading in the Zone” by Mark Douglas
(A book EVERY trader should read)
- Anything can happen.
- You don’t need to know what is going to happen next in order to make money.
- There is a random distribution between wins and losses for any given set of variables that define an edge.
- An edge is nothing more than an indication of a higher probability of one thing happening over another.
- Every moment in the market is unique.
The 7 Principles of Consistency
1. I objectively identify my edges.
2. I pre-define the risk of every trade.
3. I completely accept the risk or I am wiling to let go of the trade.
4. I act on my edges without reservation or hesitation.
5. I pay myself as the market makes money available to me.
6. I continually monitor my susceptibility for making errors.
7. I understand the absolute necessity of these principles of consistent success, and therefore I NEVER VIOLATE THEM.