3 Steps to Master Trading | #1

Today, I'd like to discuss the underrated topic of trading edge in the market. Let's shift our perspective and explore the components of your trading edge.

🚧 THE BIG FILTERThe initial element of a trading edge, in my view, is its filter. This component of your trading system provides clear signals indicating when it's best to avoid the market. By doing so, it safeguards both your financial capital and emotional well-being from unfavorable market conditions, subpar setups, and low-probability trades. Effectively executing your edge means that, more often than not, you'll remain out of the market.

🚧 YOU WILL “MISS” THE MOVESThe topic of entering the trading zone can be challenging for many, including myself. Often, the price may flirt with the zone but either reverses just before entering or touches it without providing confirmation for entry. This can be an emotional experience. However, it's important to recognize that these "missed" opportunities are also part of our trading edge. Why? Because if you have tested a setup or pattern and know it to be profitable as it is, then it should be executed accordingly. Profitability doesn't have to be extraordinary; even a modest percentage is sufficient for sustainable income, especially with access to prop firms. We can easily scale our capital if we consistently generate profits.

Remember, we don't need to catch every move or the entire move. We simply need to capture a portion of some moves. A strong trading edge enables us to consistently extract profits from such opportunities. Only then, if desired, can we fine-tune, refine, and gradually enhance our system's profitability.

🚧 THE PATTERN

This aspect refers to your entry pattern, which is just one component of your overall trading system. It's important to grasp this concept as it can help you feel more at ease in the market. Your entry pattern should incorporate a written checklist, similar to the pre-flight checklist used by pilots. This checklist is an integral part of your trading plan, serving as its essence. You should consult it before each trade you make.

🚧 LOSERS, MANAGEMENT AND BREAKEVENSAfter executing your trading edge in the market, it's crucial to manage the trade in accordance with your checklist. This involves taking partial profits, accepting breakevens, and acknowledging losing trades. If you entered a high-quality setup that ultimately resulted in breakeven or a loss, it's important to remember that this is a natural part of your trading system. It's generally not productive to excessively analyze or search for flaws in your system in such instances. However, there is flexibility, and you can certainly review what occurred and potentially make adjustments. Nevertheless, it's often the case that a losing trade is simply a normal outcome, as is breakeven.

To recap, any edge will include

🔹“missed” trades

🔹trades, where price didn’t tap into your entry order just a bit

🔹trades where you were stopped out for several pips and price then went to profit (if it repeats constantly, maybe consider having a bigger stop loss)

🔹full TP

🔹partials

🔹losers

🔹breakevens

mr sicko trading

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