Trading futures in both directions, buying (long) and selling (short), is one of the most profitable and risky areas in financial markets. Success in it does not rely on luck or random predictions, but is based on a clear strategy that starts with a small capital and gradually increases, with strict adherence to psychological and financial discipline.
Stage one: Starting with a small capital and daily discipline
The journey of the smart investor starts with capital that does not create a psychological or financial burden, such as $1000. The primary goal at this stage is not to achieve quick wealth, but to demonstrate discipline and gain experience.
Stage one: Starting with a small capital and daily discipline
The journey of the smart investor starts with capital that does not create a psychological or financial burden, such as $1000. The primary goal at this stage is not to achieve quick wealth, but to demonstrate discipline and gain experience.
Setting precise goals and managing risks:
A small daily profit target should be set that is appropriate for the total capital, along with a clear stop-loss plan.
Examples of daily targets (beginning):
Day one: Targeting a profit of $20.
Day two: Raising the target to $50, while committing to a maximum loss limit.
This progression ensures two things: avoiding greed (the trader's number one enemy) and protecting capital.
Cognitive progression and increasing trading volume:
The essence of this stage lies in linking cognitive growth with capital growth and trading volume:
Daily, weekly, and monthly goals: Setting specific time-bound goals to serve as performance indicators (KPIs) measuring progress.
Personal data analysis (specialization): Analyzing the trading record to identify aspects where the trader has shown skill (does he succeed more in buying or selling trades? Does he excel in fast trading or waiting?). This helps in specializing and focusing on strengths.
Stage two: Quick strikes and compound growth
After achieving discipline and consistent profits, one can move to a more professional stage that requires high skill in technical analysis.
Strategy of peaks and bottoms:
At this stage, the trader switches to a scalping strategy, which relies on:
Waiting for bottoms (support): Entering strong buy trades at the lowest expected price levels.
Waiting for peaks (resistance): Entering strong sell trades at the highest expected price levels.
Doubling target (2X): When trades become safer and more confident, a profit target equivalent to double (2X) the amount entered in the trade is set, continuing to safely and calculatedly double capital.
Safety condition in trades:
Compound growth is conditional on trades being safe and well-studied, meaning the risk-to-reward ratio is very favorable, and technical analysis strongly supports the expected trend.
Psychological discipline and loss management (red line)
The most important aspect of this strategy is how to deal with loss:
Maximum daily loss (red line): A maximum loss limit should be set that must not be exceeded daily, for example, 5% or 10% of the allocated trading capital.
Mandatory stopping and resting: If this limit is exceeded on any day, trading must immediately stop, reduce trading volume the next day, and take a break.
Psychological correction: The goal of stopping is not to punish oneself, but to give a chance for "recharging the psyche" and to avoid making hasty and emotional decisions (Trading Revenge), which usually lead to heavy losses.
The path to success in futures is a journey of discipline and continuous learning, starting small and growing intelligently and cautiously, avoiding the trap of greed, and maintaining calm nerves.
