3 Reasons Why You Are Not Meeting Your Trading Goals

One of the more important themes we discussed earlier is the need for traders (especially beginners) to focus on process rather than profit.

The point is that a good and disciplined trader could always turn the odds in his favor if he has honed his skills enough to handle whatever scenario comes his way.

But becoming a better trader is not as easy as reading the School of Pipsology and then making as many trades as you can with the hope that experience will teach you the path to profit.

In fact, many traders can’t even get past one or two issues they’d like to tackle, let alone improve their skill sets.

If you find yourself having to work on the same set of trading issues or problems month after month or year after year, then you may be guilty of one of the scenarios below:

1. You don’t have concrete plans to address them.

Remember this a goal without a plan is just a wish. Solutions to your trading problems shouldn’t be like your New Year’s resolutions that you forget almost as soon as you write them down in your journal.

Whether it’s something as simple as not placing stops or jumping on a trend too early, or something more complicated like cutting winners and letting losers run, you need to have concrete plans if you want to successfully combat trading problems.

Set trading goals that work. List concrete steps you can take and set a schedule to make sure you follow them. Set metrics to help you gauge your success, if that helps.

2. You don’t actively think about it.

You can have the most detailed game plan, but still fail to meet your trading goals if you don’t consciously work towards them with every trade.

Let’s say you decided to base your position sizes on your account balance instead of using fixed units. Your plan is to calculate for each position before entering a trade. You give yourself a pat on the back for managing to do it for a week.

But suddenly an intraday trading opportunity arose and you chose to break the habit of setting fixed position sizes rather than lose the move.

You probably thought “Eh, I’ll get back to working on my goal in the next few trades.” And because you earned your trade, you’ll think “no harm done” and probably do it again in the future.

These little tricks and breaks you give yourself may not hurt you in the short term, but eventually they will add up to break your momentum. Next thing you know, you’ll be listing “use dynamic position sizes” in your goals again next year.

3. Don’t track your progress.

Perhaps the most common reason why you can’t solve your trading problems or meet your goals is that you don’t follow through.

Just as chefs list the adjustments they make to their recipes, you should also track and evaluate your progress.

What have you done so far? Are you closer to your goal today than you were a few weeks ago? What factors help and what should you pay attention to? How can you improve faster? A trading journal is perfect for this purpose.

Regularly reviewing your progress not only gives you a “cheat sheet” in case you slip up and fall back into old habits, but it also helps you put your trading goals into your thought process when you trade.

Remember this trading is a marathon not a sprint.

If you want to keep day trading until you become consistently profitable, you need to learn how to successfully tackle your trading problems and get in the habit of working towards (and meeting) your trading goals.