trading rules

While these rules provide a foundational framework, it’s through continuous learning that traders can fine-tune their strategies, adapt to market shifts, and make informed decisions. In essence, intraday trading rules serve as the compass, while continuous education ensures the journey is informed, adaptive, and forward-looking. Overtrading occurs when a trader buys and sells assets more frequently than necessary, often driven by emotions rather than a strategic plan. It’s akin to being on a roller coaster, where the thrill of the ride overshadows rational decision-making.

Financial markets are never stable and change continuously. That means you need to keep your knowledge fresh and develop your trading skills trading rules as well. That is how you can keep up with the pace of the financial markets. That is only possible when you become a student of the market.

“Every Candlestick Patterns Statistics”, the last trading book you’ll ever need!

You must have a plan to exit the winning or losing position. Obsession is a negative attitude that always brings unfavorable consequences. So, always have an exit strategy to get out of a position. The first rule of day trading is never to hold onto a position when the market closes for the day. There was a time years ago when the only people able to trade actively in the stock market were those working for large financial institutions, brokerages, and trading houses.

JASON ALAN JANKOVSKY has been a trader and market analyst for over twenty years. He provides daily commentary on the markets for Infinity Brokerage and is the featured speaker on a daily Internet broadcast, The Morning FOREX Briefing, sponsored by ProEdgeFX. Jankovsky has authored several trading systems, trained other successful traders, and written numerous articles on global cash FOREX. For a detailed list of resources and tools available from the author, please visit

Take a bold decision when the trading plan isn’t working

On the second day the trade goes back to breakeven and is closed by your stop loss. On the second day the trade goes back to breakeven and is closed by your stop-loss. Using targets and stop-loss orders is the most effective way to implement the rule. Let’s say you want to buy a stock for $20 and you have $40,000 in your account. On your chart, you may see the price recently experienced a short-term swing low at $19.90.

trading rules

Stop-losses are very crucial in taking some stress out of your trading as you already know that you will lose X amount. Even winning without stop-loss is still a bad trading practice. Stop-losses ensure that you have limited risks and losses. Overtrading means you have more than five positions at a time which is an ideal way. Overtrading leads you to lose control and make hasty decisions when the market changes. For one thing, brokers have higher margin requirements for overnight trades, and that means additional capital is required.

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