hey traders in this video we're going to be discussing three reasons why you may
be failing as a Trader these are going to be mistakes that almost every new Trader makes in
that you can easily avoid to help yourself have better odds of success in your trading so make
sure to stay through the entire video because these three things alone can be the difference
between failing as a Trader and being a consistent and profitable Trader so without further Ado the
first reason that you may be failing as a Trader is going to be risk management now I know it's
probably something that you've heard time and time again if you've been studying trading for a while
and it is a little bit of a boring conversation but it is hands down the most important aspect
of trading without it you can have weeks or even months of consistent small profits but
one single big loss that wipes out all of those previous weeks or months so it is crucial to your
trading and there are multiple different aspects of risk management and trading it's not just as
simple as cutting losses on your losing trades you also have to factor in things like your position
size so let's go ahead and take a quick look at the chart gns gns was a big Runner recently we
could see a couple weeks ago it was trading at a low of 30 cents and just yesterday it hit a high
of 6.28 cents now if we take a look here at the intraday chart for gns we can see that there is
a low at the market open just above four dollars per share so we'll go ahead and draw a line there
now just for this example let's say that you were looking to trade the opening range breakout here
in this stock so once this Candlestick here the second candle after the Market opens crosses
above the high of that first candle that's when this is technically going to be considered an
opening range breakout and the way that you typically would trade that strategy would be
to use below of that first candle again being at about four dollars and four cents in this case
as your risk level so if this happens to have a false breakout here and pull all the way back
down you would want to cut losses and get out of that trade again that is going to be step number
one with managing your risk it's simply going to be to cut losses according to your strategy
but again the other aspect of risk management that not many people talk too much about is going to be
having the proper position size for the specific trade that you're getting in in this case because
the opening range breakout happens here at about four dollars and 40 cents per share and we know
that our risk level is all the way down here at about four dollars that means that we would have
to be risking at least 40 cents per share on this trade so just for some easy math let's say that
your maximum risk at any given time is going to be 400 per trade that means that the most that you
would want to invest into this trade would be 1 000 shares because 1 000 shares multiplied by the
40 cents per share that you're risking is going to give you your maximum loss of four hundred dollars
now obviously this is going to be different with every trade not every trade is going to be as
clear as this one may be but generally speaking it is very important for your risk management to make
sure that you're not getting into positions that are much too big based on your maximum risk and
based on how far away the price is from your risk level the second reason that you may be
failing as a day trader is that you are probably occasionally chasing stocks chasing happens when
a stock is starting to take off it's spiking up quickly and a lot of people on social media
and in different chat rooms and different trading groups we'll be talking about that specific stock
and because if you've been following my channel for a while you know that trading has a lot to
do with psychology one of the aspects of trading psychology is fomo which is fear of missing out
and when people see that everyone is talking about a specific stock and it's spiking up very quickly
what can happen is they start to get fomo or that fear of missing out and they'll buy into the stock
even if it's against their trading strategy and even if there is really no good reason
to be buying the stock at that price that's what chasing is in that can very easily lead to a quick
20 30 even 40 loss on your investment if you're not careful and if you're not managing your risk
um so if we take a look here at bxrx for example this was a stock that was gapping up this morning
uh we can see that in pre-market it ran from about three dollars per share all the way up to a high
um just before the market opened of six dollars and 25 cents so it was up over 100 today in
pre-market and we could see that right out of the market open there was just a very quick small move
to the upside from the opening price and then it fell all the way back down to about four dollars
per share uh where it's currently trading now here midday and this is something that we very commonly
see with these stocks that have a big gap up in pre-market a lot of people will get distracted
by everyone talking about that specific stock or they'll kind of feed a little bit too much
into the news headline that drove the stock up in the first place and they start to chase this
stock and start to think that it's going to just run higher and higher and higher at the market
open which of course that would be a gap and go and those do happen from time to time but more
commonly what we see happen at the market open is reality starts to set in a bit sellers start
to take control and then a lot of the people that just chase the stock in pre-market are now going
to be forced to sell at a loss once the stock starts to fall okay so a very easy way to kind
of help you avoid chasing stocks is to Simply invest into a scanner or invest into a trading
group or chat room that's going to help you find out about these stocks before they actually start
to spike now obviously it's impossible to predict when a company is going to put out news or a press
release to drive the price of their stock up but with scanners and with a team of traders that are
all working together you can find out about these stocks much more quickly than you would
on your own and even in the case of bxrx here you know once this started to have this initial Spike
up in pre-market there's a very good chance that you'd be able to find out about this stock in the
low Force if you're using a scanner or if you're trading with a group and you can ride this all the
way up to over six dollars per share here in free market whereas You're simply less likely to do
that if you're trading on your own so here if you look at the screen we can see an example of the
scanners that myself and the market Master Trading Group use every single day with our trading all
of these scanners are streamed live to our Traders and you can see we have the top percent gainers in
the top percent losers we also have custom scans like the breakout scan the scanner for stocks
Crossing above and below their v-wap we have the oversold scanner and then we have the trending up
Scanner the good news is that there are countless different ways to customize scanners so that you
can find stocks that are specifically meeting the criteria that you look for with whatever strategy
you're using for your Trading the third reason that you may be failing as a day trader is that
you're getting distracted by different stocks every morning like bxrx here we have different
stocks every single morning that will Gap up big in free market because of some kind of news that
was put out by the company and with this Gap up there's going to be a lot of volume there's
going to be a lot of attention on these stocks and there's going to be a lot of volatility now
those are great things for day trading typically but if you're not yet comfortable with your risk
management skills there is no reason really to be focusing solely on these types of Trades at
the end of the day they're going to be higher risk and they are going to have the potential where you
can quickly lose 10 20 30 percent on your trades so what I'd like to recommend is to try to focus
more on stocks that nobody is really paying any attention to for example earlier in the market
Master group I posted that cosm was trying to go red to Green which just means that it's trying to
cross above the previous day's closing price and that there seem to be a lot of demand in the mid
fours over the last few trading days if we take a look at the chart for cosm we could see that this
is what I was referring to when I said there's a lot of demand in the mid fours if we just go ahead
and draw this line here at 450 we could see that every time it gets down to that 450 area there's
a nice bounce off of that level it's turning into a level of support and after I posted that this
morning we could see it once again bounced off that 450 level started to break above V web and
just recently we saw a lot of volume start to come back into this trade and it actually just spiked
up into a volatility halt so this would have been a great very profitable trading Opportunity by
paying attention to this stock that really nobody else was paying attention to at the time so now
before this big spike up that just started to happen this might have looked like a very boring
play but these boring plays can lead to explosive profits and they're also going to be a little bit
lower risk so I recommend that you keep a list of stocks that were recently big runners in the stock
market because if they're a big runner in the past what can happen just like we see here with cosm
they can find support they can consolidate and then they can have another big run in the future
okay so those are three big reasons why Traders fail in today's market I highly recommend you try
to avoid these mistakes follow the tips that we talked about throughout the video and I'm
very confident that you'll see some improvements in your trading if you like this video and found
it helpful please make sure to give it a like And subscribe to the channel so you don't miss out on
future uploads and if you want to learn more about day trading swing trading and long-term
investing or join us in our daily trading group you can find more information and get signed up
at my website Master the market which will be the first link Down Below in the description
but anyway thank you again for watching I hope you enjoyed and good luck with your Trading
[Music]