If I had to name the one habit that ruins the most accounts, it would be overtrading. It isn't loud like a single big loss; it quietly eats both capital and morale. In my experience it comes in three forms.

1. Trading past your focus window

Everyone stays sharp only for a while, usually 40 to 90 minutes. Past that point you start seeing setups that aren't there. The fix is simple: when a focus block ends, stand up and take 10–15 minutes completely away from the screen.

2. Trading past your trade limit

Decide your maximum number of trades before the day starts, typically 2–5 depending on your style. Once you hit it, win or lose, close the chart. Trade six and seven are almost always "get it back" or "a little more" trades, and both come from emotion, not the plan.

3. Trading outside your hours

Every system has hours when it works best. Trading outside them is using the right tool in the wrong place. Write down your start and stop times and treat them like office hours.

What I took from it

Once I fixed all three, my results became steadier and life got calmer: less screen time, less stress, more time with family. Removing overtrading is one of the biggest steps toward consistency.

I meet many traders who are already profitable yet still feel uneasy every time they enter. Dig a little and the story is often the same: they rely almost entirely on a paid indicator, sometimes paying more than $5,000 a year for it.

The indicator isn't the problem

A good indicator is still a good tool. The problem is that if you don't understand why it fires, you can't tell when it's wrong. The day it changes its formula, raises its price, or the market simply changes character, your support disappears.

Where confidence should live

• Price patterns – understand why they form and the psychology behind them.
• Your own setups – one or two you've practised long enough to recognise as they start forming.
• The right timeframe – matched to your style.

My advice

If an indicator makes you uncomfortable or you can't explain it, drop it. Keep what you can explain in your own words. Real confidence comes from understanding, not from a green signal on the screen.

Many people hear "averaging in" and shake their heads, because everyone has seen an account blown by buying more every time price drops. But what blows accounts is emotional averaging; planned scaling-in is a perfectly reasonable entry technique.

The difference

Emotional averaging is adding to a loser to "lower your cost" with no technical reason. Planned scaling-in means that before the first entry you've already decided the total size and split it into parts, each with its own entry condition.

How I plan it

1. Set the maximum total size within the risk you accept for the whole trade – calculated as if every part has filled.
2. Split it into several entries, for example 3. The number depends on how many "swings" your system usually needs before it's right.
3. Every add needs its own setup: a double bottom/top, a key level holding… No setup, no add.
4. One shared stop for the whole position. If all planned parts are in and you're still wrong, cut – don't invent a fourth part.

Quality assets only

Use it only on good stocks, indices or highly liquid products. Never scale into penny stocks – a weak stock can keep falling with no technical floor to lean on.

No technique wins every time. Planned scaling-in simply gets you a better average price while your risk stays capped from the start.

There is no level in trading where you become "safe forever". History has plenty of examples: Jesse Livermore, LTCM, Nick Leeson, Bill Hwang – people and firms at the very top still collapsed when emotion beat discipline or risk was pushed too far. Paul Tudor Jones, by contrast, is respected precisely because he knows when to stop.

Also: many successful traders rarely speak up. The loudest voices aren't necessarily the most consistent earners.

Six stages I went through and see students go through

1. Beginner: curious, learning everything, no system yet.
2. Overconfidence: a few early wins make the market look easy.
3. Serious study: after the first real losses, you start learning methodically.
4. Volatility: the knowledge is there but the mind isn't – FOMO, early entries, revenge trades. Most people quit here.
5. Calm refinement: often 2–5 years. Fewer, more selective trades, fixing small mistakes one by one.
6. Profitability: steady – but not the end.

After stage six

Paths split from here. Some scale up, some move to long-term investing, some teach. And anyone can slide back a stage if discipline slips. That's why I see trading as self-training with no finish line.

Many people fear sideways markets because price "goes nowhere" and every entry gets stopped out. I see it the other way: sideways is when the market draws its clearest map.

The map

Inside a range you can see where buyers defend, where sellers push back and where volume concentrates. Those are exactly the key levels you'll use when price breaks out.

Why I avoid strong runs

When price is ripping or the trend is painfully obvious, that's often where late traders get trapped: buying the top of a swing right before a pullback. A trend "everyone can see" rarely leaves room for a trade with good reward-to-risk.

What I do

1. Watch the pauses – where price stalls and moves sideways after a move.
2. Mark the range high, range low and high-volume zone.
3. Wait for the market to signal direction (a break with volume, or a clear rejection of the edge) and follow it.

Sideways isn't dangerous. Entering in the middle of a range without a plan, or chasing a run that's gone too far – that's dangerous.

Choose your path by your goal

• Scalping suits you best if you want to live from trading.
• Investing suits you best for building wealth.
• Day trading all day is the fastest way to learn – maximum contact with the market.

Pick a clear goal and commit. Everyone's path is different.

The number of stages isn't fixed

I went through many stages – not three, not five. How many you pass through depends on how well you correct mistakes and how disciplined you are. Steady profit isn't the end either: I was consistent for over two years and still hit unexpected setbacks that came from inside me.

Scalping isn't "grab and run"

People call scalping "grab and run". I see it as a hunt: wait patiently, then strike decisively. Markets alternate between slow and fast; a scalper acts only when opportunities cluster, takes one disciplined position and isn't greedy. Timing can be the open, after lunch, when volume shows up, or an indicator. And I strongly advise: don't trade around news.

What the profession gives you

For a professional, trading is work: a loss is a planned cost, not bad luck. It gives you flexible hours, no boss and the freedom to work anywhere. It doesn't automatically make you rich – a trader can live well and still accumulate less than a business owner. Every career has two sides; choose the one that gives you peace.

A common misconception

If someone says trading means reading news all day and staring at charts all night, they probably aren't a trader yet. Once you know your system, preparation takes minutes. Pick one strategy and practise until you master it. There's no holy grail – a good indicator you don't understand still drops you into its weaknesses.

I've quit jobs several times to trade full-time, then taken part-time work to cover the bills. In the US a month without income is a real crisis, so I know that pressure well. I believe trading is first a psychological battle: pressure creates mistakes, and those mistakes get mislabelled as "bad luck".

Indicators need multi-timeframe confirmation

Indicators are good at finding bounce zones, but a bounce isn't necessarily a reversal. My fix: enter only when at least three consecutive timeframes show the same signal. For a scalper: Money Flow divergence at the bottom of a range showing on the 1-, 2- and 3-minute charts at once. If that zone is also support or resistance, the setup is even better.

One setup, only that setup

Choose one setup and trade only when it appears, whatever the market is doing. Mastering one setup also teaches you how to handle it when it fails – that's what keeps you alive. Trading what you haven't prepared for is gambling. This is personal experience, not a secret formula.

Entering early is what makes you miss out

Waiting is uncomfortable; I've felt it too. But early entries drain capital, and "fixing" a bad entry by adding to it deepens the loss. By the time three timeframes truly align, the account may have nothing left. Two lines I wrote out daily until I knew them by heart:

• "Entering early is what makes you miss the opportunity."
• "Doing nothing is part of trading."

While you wait, do something else so your mind isn't glued to the chart.

Handling losing trades

I used to trade in live groups. When a winner turned into a loser, the pressure to save face made me hope for a reversal – which rarely came. Now I trade alone or with a few friends who don't pressure me.

• New trade, small size: go very small, then step away. The maximum loss on one micro contract is something I can accept.
• Larger size: entry, stop and target must be clear. A winner that flips to a loss gets cut immediately.
• Long-running trade: in profit but not moving as planned means it has failed. Move the stop to entry, exit, don't re-enter.

From those who came before

Paul Tudor Jones: get out of what's going against you, keep what's working. Richard Dennis: save capital for the rare big opportunities; don't waste it on mediocre trades. Jesse Livermore: protect capital, don't overtrade, don't add to losers – and he himself failed many times when emotion beat discipline.

Buying dips in stocks

An observation of mine: when a quality stock retraces about 50% of its latest up-leg, many buyers start paying attention. Technical analysis helps with timing; long-term investing requires understanding the business itself.

Technical analysis isn't hard. The hardest part is beating yourself to build iron discipline.

A day trader can choose options, stocks, forex, futures or crypto. This piece compares the two most common choices – buying options (calls/puts) and futures – and why many day traders are moving to futures.

Buying options

• Weakness: every option has a strike and an expiry. Pick badly and you can lose even with the right direction, especially in a sideways market.
• Time decay: options lose value as expiry approaches; held to expiry they can go to zero.
• Strength: small capital, maximum loss limited to the premium, and a fast move in your favour can pay much more.

Futures

• Strength: no option-style time decay; sideways doesn't erode value.
• Weakness: P&L follows the market with no cap. Example ES: 1 point = $50 per contract, 2 points = $100. Without a timely stop, even one contract can blow a small account.

When I use which (personal view)

Options: when the trend is clear and you expect a fast enough move, or on big event days when you accept losing the whole premium.

Futures: normal days, with a well-placed stop. With a clear strategy you can estimate each trade's P&L in advance, which makes risk easier to manage. Start with micros (MES, MNQ) – ten times smaller per point.

Trading, technical analysis and fundamental analysis aren't especially hard – fundamentals are ultimately comparing numbers. So why do most people who enter the market lose money?

My answer: discipline yourself.

The more you learn, the messier it gets

Beginners often make things more complicated the more they learn, and lose discipline the more they lose. After 4–5 years many feel they know a lot, refuse to admit being wrong, and blame the news or the market.

Change yourself, not your method

There are countless methods and no two successful traders are alike. Learning more methods or copying others won't get you there. What to build:

• Discipline.
• Patience to wait for the right opportunity.
• Entering only when the setup matches the method you trust most.

Nobody forces you into a trade or clicks the mouse for you. Losses are your responsibility.

Small, steady profit is success

The small-but-steady phase often lasts a long time and tests your patience again. It may last because the account is small, because you know not to rush, because you manage risk well, or because you've lost the appetite for high-risk trades. All good signs.

The formula

Basic technical analysis + discipline + persistence to feel and understand the market. "Basic" is deliberate: repeat the fundamentals long enough and they become advanced. Understanding the market can only be built through real contact with it. Time will prove it.

Someone asked me: is it hard to become a trader? The most honest answer: it depends on the person.

Neither easy nor hard

It's like learning any simple skill – time to mastery varies. But there's one big difference from a normal job: at work you get paid once you know how to do it. In trading you must reach real mastery before income becomes consistent. (I mean consistently profitable traders, not those making millions or billions.)

10,000 hours

Malcolm Gladwell popularised the idea of about 10,000 hours to expertise. Trading is simple in principle, so anyone can try – but it isn't easy, because you put in a huge number of hours before any income. Most quit midway after working unpaid for so long while losing money, time, effort and morale.

If you only want the money

If you want trading income but don't want to become a trader, I have no advice – that goal is wrong from the start.

If you really mean it

1. Find a teacher for the foundations: trading basics, technical and fundamental analysis.
2. Don't trust or follow anyone blindly when investing or trading.
3. Trade yourself, research yourself, choose a strategy that fits your personality and develop it over the long run.

The path is simple, but it's a process.

I wrote this to keep a promise to my first students – one complete process for anyone looking for the road to consistency. It comes from my own experience, not a book.

1. Two kinds of key level

• Support / resistance – drawn as lines: where price has bounced before.
• Supply / demand – drawn as zones: where the trend has reversed before.

Both mark places of past heavy buying or selling. The difference matters because their reliability differs.

2. Three timeframe groups

• Scalping: 1 min – 15 min
• Day trading: 5 min – 4 h
• Swing: 15 min – 1 D

Each has its purpose. Scalp off a 2-hour chart and you'll be lost when price moves against you – like selling summer shirts in winter: right product, wrong timing.

3. The process

1. Pick a style that fits you: fast and active suits scalping; calmer people suit day or swing trading.
2. Draw key levels on the highest timeframe in your group – for scalping, the 15-minute. Higher-timeframe levels are the "thickest armour": like the Three Kingdoms strategist who put his heaviest-armoured troops in front and charged only once the enemy's arrows ran out. Find the strongest level, then act once the opposing pressure is spent.
3. Find the setup on a lower timeframe. My example: key level on the 15-minute, double bottom on the 1-minute – scalp entry.
4. Add indicators for confirmation if you like: RSI, MACD, Bollinger Bands… I use RSI and MACD.

The full trade: double bottom + key level + MACD + RSI, on the right timeframe.

4. Why trades still lose

When I lose, the cause is usually rushing in too early, FOMO after price has already moved, or not trusting the setup and cutting too soon or in the wrong place. Still, no structure works every time – so always have a stop.

5. Advice

Practise with small size until you're skilled. Don't go big and run out of capital before you have the skill. Increase size only once you have real confidence.

Students often ask me: what is a setup, why does it form, and which ones should I trust?

Definition

A setup is a shape that forms in a ticker's price data. It appears because many traders share the same psychology: at certain prices people collectively want to buy, or to sell/short. Setups tied to those areas tend to be more reliable.

Limits

Don't trade a setup on its own. Understand timeframes and consider adding indicators to raise the odds and keep risk as low as possible.

Advice for beginners

• Pick the 1–2 setups you like most.
• Be patient and enter only when they appear.
• Practise them consistently for a long time – far better than trying to master every setup at once.

Once fluent, you'll anticipate a setup forming and enter earlier, at a better price than those waiting for confirmation. These days I no longer wait for confirmation – I start entering as the setup takes shape. But that comes from many hours of practice, not where you start.

Risk management

Never go "all in" – whatever your mood, however pretty the setup, whoever is pushing you.

Four steps

1. Define your goal: scalping, day trading or swing.
2. Choose the matching timeframe.
3. Wait for the first leg that could form your setup. When it appears, identify the target (usually already visible). Entry and stop are still a mental plan.
4. Wait for the second leg to make the shape clear – then enter.

To withdraw real money from a prop firm you usually pass two stages:

1. Pass the Evaluation under the firm's rules to receive a funded account (often called a PA).
2. Meet the payout conditions on the funded account, then withdraw to your bank.

1. Trailing drawdown

Very common. Example $50k account: $3,000 profit target, $2,500 trailing limit, a maximum number of contracts. "Trailing" means the failure level rises with your peak balance and always sits $2,500 below it.

Example: make $1,000 to reach $51,000 and the failure level is $48,500, no longer $47,500. Lesson: after gains, don't let the account fall back from its peak by the trailing amount.

2. End-of-day (EOD) drawdown

The drawdown level updates only from the closing balance, not every intraday swing. That gives more room during the session, but you still have to respect the maximum loss and maximum contracts.

3. Daily loss limit

Example: lose $1,100 in a day and the account is locked for the rest of the day. You can trade again tomorrow, but the overall limit still applies – with a $2,000 total you'd have only $900 of room left.

Common payout rules

• A minimum number of trading days before a withdrawal (sometimes only days above a profit threshold count).
• A "consistency" rule: your best day can't exceed a set share of total profit.
• A buffer that must stay in the account before the excess can be withdrawn.
• The share of profit you may withdraw each time.
• An activation fee for the funded account after passing – some firms charge one, some don't.

Advice

Every firm's rules differ, often a lot. Read them carefully before you buy, and while trading watch the trailing level, daily limit and contract limit closely. Most accounts fail not because of the market but because the trader forgot a rule.

Continuing the series on common indicators: small, often-overlooked details can noticeably improve how you read signals.

Origin

RSI (Relative Strength Index) was introduced by J. Welles Wilder Jr. in 1978 in New Concepts in Technical Trading Systems. It uses 14 periods to gauge market sentiment and identify overbought and oversold conditions.

Calculation

• Each period: if the close is above the previous close, U = the difference and D = 0; otherwise U = 0 and D = the drop.
• Smooth U and D with an SMMA, a = 1/n.
• RS = SMMA(U, n) / SMMA(D, n); RSI = 100 − 100 / (1 + RS), giving 0 to 100.

Keep the 14

Many people change the 14 to make "their own version". I don't recommend it: 14 reflects a psychological cycle, and every change means re-learning a new indicator. Simple is what you can optimise.

Zones

• Below 30: oversold.
• Above 70: overbought.
• Around 50: neutral / sideways.

From basic to divergence

The basic approach – sell overbought, buy oversold – is of limited reliability on its own. What makes the difference is divergence:

• Bullish: price still falling, but RSI is oversold and momentum is turning up – selling pressure is fading.
• Bearish: price makes a new high while RSI falls – buying pressure is running out.

Bottom line

Wait for clear signals: overbought/oversold combined with divergence. But no indicator is always right – RSI often fails on big news days or with unusual volume. Strict risk management is still mandatory.

I once promised to write down my trading knowledge and experience. It's a big subject, so it comes in parts – this one is MACD.

What MACD is

MACD (Moving Average Convergence Divergence) was developed by Gerald Appel in the 1970s, built on trend, momentum and average price.

• MACD line = EMA12 − EMA26
• Signal line = EMA9 of the MACD line
• Histogram = MACD − signal

Basic use and its limits

The basic signal is a reversal when MACD crosses the signal line. In my experience this is only dependable on 1-hour charts and above; lower timeframes are too noisy. The crossover is right but late – entries and exits lag and reward-to-risk suffers, so it doesn't suit scalping or day trading.

Read the histogram to get ahead

• Bearish example: price still rising while the histogram shrinks – momentum is weakening. Once MACD and signal are close together, I look for a short without waiting for the cross.
• Bullish example: price falling while the histogram starts rising; then MACD crosses up and price follows.

If you only wait for the cross, you're already late. Practise reading all three parts together and learn divergence.

Risk

No tool is always right, and the losing trades can be dangerous without risk management. Two rules: never overtrade, and never trade beyond what the account can recover from.

One indicator is enough for steady results if you practise until it becomes reflex. You don't need to study endlessly.

This is personal experience and may differ from other sources – filter it for yourself.

Indicators are measuring tools

Each measures one thing: Volume measures volume, RSI momentum, MFI money flow. Some combine measures, such as momentum plus volume.

Do I use them?

People see my chart with just candles and volume and ask how I trade. I do use indicators – only the originals, unmodified: RSI, MACD and Volume, mainly on higher timeframes to read the overall trend.

Why: indicators aren't precise like a mathematical measurement. Tweaking them doesn't meaningfully improve accuracy – you have to learn through experience how to get the most from them.

RSI as an example

Books teach buying oversold and selling overbought. In practice, oversold doesn't guarantee a bounce and overbought doesn't guarantee a drop. Experienced traders wait after an oversold reading for price to go sideways or form a specific structure before entering.

Should you use them?

• Yes – if you're new, or still short on discipline and experience.
• Not necessarily – if you understand the market well. Even then, many still confirm with indicators or other methods: market cycles, sector movement, multi-timeframe analysis.

Advice

Pick 1–2 indicators and use them until you truly understand them. Don't drop one after a few losses: even someone right 7 times out of 10 is wrong 3 times. Losses also come from emotion and psychology – so manage risk so losers don't erase your gains. Once you can feel the market, you'll develop your own approach.

More and more traders, veterans and newcomers alike, are moving to funded trading.

Definition

Funded trading means trading someone else's money – usually a financial company called a prop firm. You pay fees (an evaluation fee, an activation fee, or a monthly fee depending on the firm) instead of putting up the full capital. Meet the conditions and you keep most of the profit.

Watch out for scams

Before choosing a prop firm, read reviews from several independent sources. Some firms don't pay out, and you can lose both the profit and the fees you paid. Prefer firms that are transparent, established, and have a clear payout history.

Read the rules carefully

Every prop firm has its own account rules: drawdown, daily loss limit, maximum contracts, payout conditions. Read them before you buy – see also Evaluation and payout rules.

Funded trading gives you access to more capital at a lower cost, but it can't replace discipline. If you aren't consistent on a small account, a funded account will blow too – just faster.

Day trading means trading quickly within the day. Markets can move very fast, so you have to watch your own positions.

An alert is only a starting point

Don't trust alerts completely. Treat one as a prompt to open the chart, not a decision. Watching the trade keeps a winner from turning into a loser. Even when trading with others, never day trade without looking at the chart. If you want to earn from day trading, there's only one way: learn and trade for yourself.

News

• Don't read news to explain what already happened – by the time you find why price fell, it has finished falling.
• Check news before you enter, not after.
• Only a few big releases really move the market; most news can't push price against the money flow.
• A day trader needs only a few headlines about the direction of their sectors. Avoid reading deeply into stories that add emotional pressure while you're in a trade.

Technical analysis

If you've learned TA, apply it to quality stocks first. If you can't analyse the data yet, stay away from penny stocks. For a day trader, TA is the core tool. And until you're winning consistently, hold off on buying options.

Afraid of the market? Don't quit – go smaller

Start with small size, using money you can afford to lose. I'm not a fan of paper trading because it makes people careless – real money feels completely different. The difficulty is mostly psychological: calm down, review your trading systematically, and it gets easier.

A plan for every trade

I've taught five classes and always focused on self-analysis. Students now analyse stocks on their own – wins and losses both become experience. Every trade needs a clear plan:

• Where to enter
• Where to take profit
• Where to cut the loss to keep it small