The trading system is one of the most important thing that every trader should have because it benefits you in numerous ways and hence, in today’s article, I will be explaining to you why it is important to trade according to your trading system and not what you think. As a trader, we all know that we should not trade emotionally to become successful traders. However, it is one thing to know this rule and another to implement it.
Our human mind is structured in such a way that it tells us or instructs us to do exactly the opposite of what one should do to become a profitable trader, and our motive is to control our mind, and for this, we need a solid trading system that instructs us to do what is right at that point of time. So, that is why in the long run, your view will not make you money, but your trading system will, and hence, following your trading system is far more important than your view on the market.
By trading what we see on the charts rather than what we think, ensures that we are trading logically and we are following our trading system. Now I am going to discuss a few points regarding why you should follow your system and why it is important for you to do so.
When you have a strong view on the market, and you hope that your view will go right irrespective of other circumstances, then indirectly you are gambling. Whenever you take a trade just because of your instincts and not because of your logic and system, you gamble. Unfortunately, many traders commit this mistake, and they fail to understand the importance of the trading system.
When you trade anything other than your setup or plan, indirectly you are trading because of your emotions. So, that is why it is important to follow one particular trading system consistently for a long time because that is what makes you a successful trader.
Just because you have a view on a market doesn’t mean that your view will go right every time. Similarly, if you find your setup that you think will definitely work, you can’t risk all your money on that trade. Hence, it’s always important to cut your losses fast when your trade goes wrong.
A trader needs to detach himself emotionally from his trades. This is the most important rule of trading because once you start to trade emotionally, you will take riskier bets, and you will not cut your losses fast rather you may average them. The best solution for this problem is to follow your strategy with proper risk management so that every time you use your strategy, you will manage the risk of your capital.
The market is surely uncertain, but there is one certain thing in the market and that is the market does not care about you. Whether you are making money or losing money, whether you are rich or poor, the market doesn’t make any difference, but after knowing all this, still many people get emotional about their trades, and that is why they get frustrated, and they allow themselves to be in control of markets. You will not become a profitable trader until you develop the right trading psychology.
Once you learn how to trade what you see, not what you think; then you are on the verge of becoming a profitable trader because once you do that, then you are not allowing markets to control you, rather you are controlling yourself and your emotions with the help of your trading system.
Until this, we have understood why your trading system is far more important than your opinions. Now, we will see how to trade according to your trading system and not according to your opinions.
Tip 1: Self-Talk
Before taking any trade, ask yourself “Why am I trading?”, “What is the setup? “, ” Am I trading with the right position sizing?” ” Have I decided my stop-loss?” asking these questions to yourself will help you a lot in building the right trading psychology.
Tip 2: Follow All The Rules of The Strategy You Are Using to Trade
If you are trading according to price action, make sure that every setup you are following is in accordance with what you learned in your course or book. This tip will allow you to follow the protocols of your trading system rather than your opinions.
Tip 3: Know the Risk You Are Taking
It’s always important to calculate the risk before entering into any trade. Many new traders only look at the rewards instead of risk, and they end up losing more compared to what they can afford to lose. So, calculate risk, position size accordingly, and cut down your risk whenever you get the opportunity while still making acceptable profits.
I hope that, through this article, I was able to explain to you the importance of a trading system, Why it is Important to Follow Your System Over Your Opinions, and ways to do so. In case, if you don’t know how to make a trading system, then don’t worry, my Booming Bulls Elite Trader Live Mentorship Program will help you with everything. Also, I hope that after reading this article, you will definitely follow your system over your opinions and make consistent returns from the markets.
If you want to know more about Risk Management & Intraday Trading Strategies you can refer to our previous blog on
Importance Of Risk Management In Trading and 10 Best Intraday Trading Strategies.
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Thank you it really helps to be mentally strong in the market
Thank you, Rishabh, glad that you find the blog helpful.
Sir, your trading system and trading Strategy is mind blowing.
Bahut acha samjhaya hai
Very good to read. Beautiful article. Excellent written
Really well explained
I want to learn proper trading strategy so please can you teach me
I AM A BEGINNER IN THE MARKET , I STARTED FOLLOWING THAKUR SIRS VWAP+STOCHASTIC RSI+PIVOTS STRATEGY .
I STARTED PRACTISING THIS STRATEGY ………..LETS HOPE I MAKE IT TO THIS STRATEGY AND THEN START INTRADAY WITH SMALL CAPITAL OF 5-10K WITH PROPER RISK MANAGEMENT .
THIS BLOG IS AMAZING .
Thank you, Samarth, glad that you find the blog helpful.
It’s really amazing.
Sir this article is too much helpful and on point for my query. Thank you for providing such knowledge for free.