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This article contains a list of suggestions that Kyle Eschenroeder has provided to his fellow traders, a former professional speculator, Kyle witnessed a friend's $ 2,000,000 win, which however lost them in just one trading day. Why could it be useful to learn from him? The reasons are at least two. 1) At a precise moment in his life, Kyle was a successful trader. 2) He is not trying to sell us anything, indicators or particular strategies, he just wants to share his knowledge.
According to Kyle, one of his colleagues, investing $ 30,000 would have earned $ 2,000,000 in three months, then lose them two months later by implementing the principles we will list below. Choosing whether or not to apply them is your choice. However, a smart inveset is never reluctant to learn from a colleague.
In this article, Kyle goes into detail about a particular trading system that he used himself before, when he was still a trader. However, following your strategy to the letter could be really risky, that's why: 1) it was made public, so it is compromised, 2) as you'll see later, every trader is encouraged to create their own trading system.
Here are a series of rules that can guide you and help you in your trading activity.
What not to do
1. First of all, learn what to avoid. Why? Because when you're about to run out of money, your trading trip stops abruptly. Finally, you do not want to risk your money before you understand what trading really is, since it's the easiest way to lose all your capital.
2. Also, do not trade without an appropriate trading system. Probably (or, rather, surely) it will take some time to develop one, but the effort will be fully repaid. According to Kyle, a month of profitable trading with good earnings is enough to test the system. However, you should take into consideration the psychological differences between trading on the demonstration account and trading on the real account when deicides make the switch.
3. Do not trade when you are prey to emotions. He probably already heard it. Yes, it's definitely the most important piece of advice you can get on trading. Good decisions come when you are calm and cold-minded. When you are agitated or scared, on the contrary, you will make incorrect decisions. Your trading decisions must come from your trading system (figures, rules), not your judgment.
Creation of the system
To create a good system, you will need to consider the following aspects:
Offense. This point refers to when and how you open the operations. In other words, under what conditions do you consider a long position or a short position. Remember that your feelings are not a sign of a forthcoming and imminent trading opportunity. Rather, you should use the signals provided by your trading system.
Defense. This point is perhaps even more important than the previous one. Stop loss levels can be used to manage losses and improve your long-term trading strategies. Also, define the amount you are ready to lose in a session. Kyle claims it is wise to invest 1% of his trading capital, or even less.
Indicators. Which and how many indicators to use. The most important rule is "do not complicate things unnecessarily". A simple system with the least number of indicators (or even no indicator) is easier to manage than a super complicated monstrosity.
Another thing to avoid
There are some other things you should avoid. In this article, Kyle emphasizes how detrimental it can be to use a third-party trading system or based on the newsletter. Instead, rely on your knowledge and skills.
Source: How to Make (and Lose) $ 2,000,000 Day Trading: The System & The Story
On how to create a trading system and adopt the right mental approach according to Kyle Eschenroeder. Now that you know how to do it, you can test yourself on the IQ Option trading platform.
This article does not represent an investment advice. Any reference to past movements or price levels is informative and based on external analyzes, we do not provide any guarantee that such movements or levels may reoccur in the future. In accordance with the requirements set by the European Securities and Markets Authority (ESMA), trading with binary and digital options is only available to customers categorized as professional clients.
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Source: IQOption blog 2018-11-08 12:14:53