My Friend was Lucky, Don’t Make the Same Mistake
January 21, 2015
3 Min Read
I got a call this morning from a friend of mine who recently started trading. He was showing off to me about how he used the setups we discussed yesterday to make £1,000 this morning.Do you want to guess what my response was?STOP!He was expecting me to be full of praise, but unfortunately he broke the first principle and a big mistake that a lot of new traders make: he was impatient and started trading before understanding fully what he was doing, or even having all the necessary tools.I clearly stated that yesterday’s setups were just one of the building blocks. In any case, if you want to find out what he did then I have included it at the end of my post and you can go there to find out - I don’t want to promote that sort of action, so it hasn’t made the main post content today but I like being transparent with you all, so feel free to go and read that for free below.
Discipline is the key to success
As you can see, my friend needed some discipline. Which is one of the core skills you need in trading (and generally to be successful in anything); after all, trading is often said to be 80% psychological, so you need to be disciplined.
Here is my friend’s story
My friend made £1,000 using binary options. Let me first of all state that I don’t condone this, as I hate binary options and think they are misused, leading to most people just throwing away money.However, I wanted to be transparent with you and share how he did it, so you don’t think I’m holding back any knowledge from you.Basically, he used swing high/lows that were residing inside reversal zones on a 5 minute chart. When he had a type 1 or type 2 close on one of the swing high/lows, he would open a binary trade in the opposite direction for 5 minutes, expecting the reversal to happen.I’ll explain all about swing high/lows and reversal zones in our lessons.His success rate was 75% and by using a money management strategy of 30% of the account at risk each time, he managed to make £1,000.This sounds great, but my opinion is that it could have just as easily backfired and lost him £1,000. He was impatient and this will work against him in the future.If you do want to use binary options then that is up to you. I don’t advise it, but if you do want to use them then at least wait until you know more about trading the full method.