Why do 80 percent of traders fail in market trading? This chapter summarizes the methods presented in this book for being a successful trader, and it all starts with having a philosophy.
First of all, every trader must subscribe to a philosophy for successful trading. Below we'll discuss four common philosophies of successful traders.
The first philosophy is that there is no place for emotion in day trading. Set trading rules that are followed and use them as a foundation for all of your trading.
The second philosophy is to always follow the market makers or institutional traders. Market makers make a market in the stock while the institutional traders (pension fund managers, 401K fund managers, and mutual fund managers) control massive amounts of money, which controls supply and demand.
Third, successful day traders keep things very simple (complication equals confusion). Never forget the KISS method (Keep It Super Simple). Keep your trading system strategy simple because simple has advantages, such as: