In trading, its very important to have a specific set of rules that you follow religiously. Frankly speaking, trading really doesn't have any rules. You can either get in or get out of the Intraday trading whenever you want.
Trading is the only business which has too much freedom. Freedom is good, but you need to have a structured freedom. If you decide to trade without any rules, then definitely you will not be successful. Now what does structured freedom means? It means that you can trade whenever you want, but that trade should fall under your set of rules. Rules will help you to be more consistent with your trading. These rules will help you that can drain your account.
Once in every six months, write a new set of trading rules for yourself. These rules will help you to be structured with your Intraday trading. The problem is most people don't want to make up their own rules, because that would make them to take responsibility for their results. Most people don't want to take responsibility for their action. But only by taking 100% responsibility, you can be successful in trading.
Common Rules to be followed in trading:
1) Never place a trade without a stop order. It would be like swimming without a life jacket.
2) If you lose 3 trades in one day, stop trading. Avoid digging yourself in a huge hole.
3) If you earn decent amount of money in a trade, then don't allow yourself to lose money on that trade.
4) Always use a chart formation or technical reason to get into Stock market. Only use a signal to get into the Stock market. Don't just take a shot. You will usually get yourself in trouble if you take a shot.
5) Use the value area. It will help you to stay on the right side of the Stock market. Consistently trade on long side above value and the short side below value.
6) Always act with your best interest in mind. Try and do this with each and every trade you put on.
7) Relax with your trades. If you don't enjoy your trade then you will not be successful.
8) You don't have to trade everyday. Sometimes, just leave the Stock market alone and forget about it for a day. It usually refreshes you.
These are some of the common rules which have to be followed. But its advisable to come up with the own set of rules and follow it religiously. Your ability to follow the rules is a direct reflection of how much money you will make with your Intraday trading. It also reflects your survival in Stock market. The more you follow them, the better you trade.
Even if you take the Intraday tips from the stock advisory company, you have to follow your set of rules while placing a trade. Otherwise, it becomes very difficult to survive in the Intraday trading and ultimately you will leave the Stock market with bitter experience.
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