10 Steps To Become A Trader

By Author: Markus Heitkoetter
Total Articles: 11
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Traders, regardless of experience level, often ask the same question: Where do I go from here? If you find yourself asking this question, here are ten easy steps that will help you improve your trading and move to the next level.
Here at Rockwell Trading, we come across many types of people. Some of our clients come to us with some experience trading, and want to improve their trading. Others come to us with very little knowledge about trading, and want to learn everything we have to offer. However, the question for all of them is the same: Where do I go from here? I have put together ten steps I think are crucial to becoming a trader. If you are wondering how to proceed from where you are now, or don't know how to get started, these are the steps you need to follow.
First, you need to decide what kind of trader you would like to be. Do you want to be a day trader? Do you want to be a swing trader? What kind of markets would you like to trade? Would you like to trade Stocks, Futures, Forex, or Options? The decisions that you make at this point will be some of the most important decisions you make about ...
... your trading career. But remember that whatever you pick will have to suit your needs and your time constraints.
When you have decided what kind of trader you would like to be and which markets you should trade, you will then need to decide on a trading strategy. This strategy will reflect all of the decision you made in step one. For example, a day trader will use a day trading strategy, and so on.
Your third step to becoming a trader will be to find a charting software and trading platform. Your trading platform should support the strategy you chose for yourself in step two. For example, a trader who would like to trade Futures will need a broker and a charting software that supports futures.
The fourth step I suggest to all traders should be obvious, but this is something that so many traders overlook. To become a trader you must practice your strategy! Practice is important for two reasons. Firstly, you need to make sure that your strategy actually works. Secondly, practicing your strategy will lead to confidence when you are actually trading your strategy.
In order to improve your confidence even more, I suggest that you also learn chart reading to improve the performance of your trading strategy. All trading strategies are either trend following or trend fading. Learning to read charts will allow you to adapt your strategy to trend following or trend fading markets.
A very important next step is to have proper money management. Money management is the number one area where traders fail. It is possible to lose money while trading, even with a profitable trading strategy, if you have no money management.
Next, you must create a trading plan. A good trading plan will outline the markets you are trading, your trading times, trading strategies, and your money management approach, among other things.
Once you have accomplished all of these things, it is time to start gearing up for real trading. You can do this by executing your plan on a simulated trader. Many traders want to jump right into the market, but that's like trying to fly a plane without any flight experience. Ideally, you will want to spend four to six weeks testing your plan on a simulator. This will help to build your confidence for live trading.
You have now reached the point where it is time to trade on an actual account. But this does not mean you should go wild. Even though you are ready to trade an actual account, you should still start small. You will want to test out the waters and see where your comfort levels are.
Finally, you must use the money management you learned to grow your trading account. Once you are consistently profitable, you can use money management to boost your trading account and take your trading to the next level.
These are the ten steps I recommend to anyone who wants to become a trader. If you have already accomplished some of these steps then you are ahead of the game, and you can proceed from where you are. Just know that if you follow these steps, and really dedicate yourself, you can become a trader.
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