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Trade Futures Successfully Using These Seven Trading Secrets

Mar 29, 2008
It is no coincidence that the most successful floor traders are in general those with the most experience. This is because I believe that trading is essential a skill based activity which requires both practice and experience. There are many similarities between very competitive skill based sports, like golf or tennis, and trading. Here are 7 of the key skills that you must develop as a trader.

1. Technical analysis can be used for futures as well as the more standard stocks, options and bonds that most people trade. This can give you a large edge over other traders who have not taken the time to study the charts support and resistence areas, trendline and patterns. learning technical analysis is really a must do if you want to trade futures successfully.

2. Always have a trading plan before you enter the trade, and more important than your entry point is your exit point. Your exit strategy could include multiple points including several price targets where profits are taken and a stop loss point.

3. Ask any experianced trader who makes money every month and they will tell you the number one secret of trading is to keep your losses small. Amateurs take a long time to learn this. By doing this your small losses will cancel your small wins and you will be left with your big wins which is how you will make money over time.

4. Professional traders tend to be more patient than amateurs and wait for the market to come to them, amateurs on the other hand tend to over trade, which is a big mistake. Learn to be patient and cherry the best opportunities, this requires both patience and discipline but they are skills that can be easily mastered.

5. Keep both a daily and weekly log of all your trades. It is essential that you follow up with all your trades, both good and bad, to learn what your mistakes were. To become a very good trader it is simply a case of eliminating all your mistakes. This does not mean that you don't have loses but it means that you followed your trading plan and kept your losses small.

6. Trading is a tiring activity, even if you are sitting down all day!. Don't trade unless you are feeling both physically and mentally well, and are well prepared for the trading day ahead. Prepare for each day by 1st getting a good nights sleep, reviewing your trading plan, rules and charts before the market opens. It is also very important to be in the correct frame of mind, yiu must be confident in yourself and your plan if you are going to trade, otherwise don't trade that day.

7. Before using your hard earned cash in real trades make sure that you have done sufficient paper trades to give you confidence in your trading system. Paper trade until it becomes boringly successful, then you know that you are ready to use real money.
About the Author
James J. Dehoiver is an master stock, options and futures trader and teachs online futures trading systems. Download a free advanced futures options trading ebook from his website today.
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