How fast I can become a successful trader is one of the most frequent questions I get daily from people worldwide. It is hard to answer how fast someone can become a successful individual, but on average, if you follow a good coach, you can be profitable in 6-12 months.
After coaching over 3000 traders in the last couple of years, I think I can help you with this goal! Today I would like to go through 6 monthly processes that anyone can apply and improve their trading. This short guide would work for everyone; I do not care if you traded for the last ten years or just started this journey.
Just one important thing: If you follow the process the same way as it’s written, you will become a better trader in less than six months!
We will separate the process into six months plan that you will need to follow! Due to the timeline, don’t stress out right away; you’ll start seeing improvements and progress much faster than you expected. Let’s start with the first 30 days plan.
Month 1 Plan – Learn About Market as Much as You Can
I love to compare trading with driving. It’s the same thing, you are going to learn how to go from point A to point B, and that’s all. Now, remember, what is the first thing you did before you could legally drive the car around your hometown? Yes, I’m talking about learning how to operate the vehicle and go according to road rules & regulations. The first 30 days will be the same here. I would suggest that you start learning basics and learn as much as possible.
This doesn’t mean that you need to read 101 books or things like that, but you’ll need to start getting educated on trading.
When we talk about education, you have a few things to understand:
1. Basic Trading Terms
2. Technical Analysis
3. Fundamental Analysis
4. Trading Psychology
5. Risk Management
6. Trading Platforms
You have plenty of education material online. Most things you need to know right now are free, so you can do it right away without spending a dime. I’ll never say that you can’t get a coach to help you, since that can impact the time, especially if you find someone who knows what they are doing, but this won’t be a must!
During the first 30 days of the journey, I want you to learn how to read the charts, identify a trend, find support/resistance and get an idea of how the market works, but you don’t need to trade much. It’s most important to me that you practice drawing what you learned and feel how news moves the market, but that’s all.
Once the first month is over, you will have a lot of new skills that we will put to work in the second month.
Month 2 Plan – Strategy Development On a Demo Account
You already have some knowledge and access to some trading platforms, but if not, don’t worry. Now it’s time to open what we call “DEMO ACCOUNT” it’s a virtual account where you can practice trading and see how good you are. For this part, one element can be crucial, choosing the correct account size and leverage. Most brokers offer “Free 100k or 200k” accounts, and that’s not the way to go. You want a small $1000 account with any leverage that’s 1:10 or higher (leverage doesn’t impact this stage, so you don’t need to worry). Getting a smaller account is smart since emotions won’t be as high as they are on 100k or higher accounts.
Once you got the platform installed, it’s time to search for the system that you will use. Keep in mind that you are still quite new to trading, so focus on some simple systems to start. Some pattern trading or supply/demand can work great for you. If you want my suggestions, start with simple FLAG trading, you can find all rules in this blog post:
Once you have found the system to use, feel free to start trading, do not worry about the win/loss ratio. All I want you to do is play for the first few days and just check out how everything looks when you place a trade.
After week one, it’s time to get more serious about your trading, and you are going to write the entire plan down on a piece of paper with a full risk guide so you can checkup out every trade fast. I can suggest making some sort of checklist before you enter a trade.
The image above is just an example of the checklist you want to have while you trade. Feel free to copy or tweak this however you want to align with your strategy of choice.
At the end of the second month, I would like you to check your trades, see what stats are telling you, and either proceed to next month or keep repeating this month until you don’t have a minimum BE month or slight profit. Don’t expect to make 40-50% at the beginning. I would be more than happy if you could be around break-even, this will be enough to move to next month’s plan.
Month 3 Plan – Your First 100$ Account Challenge
The third month is when I want you to move from DEMO to REAL account even if you are around a break-even trader. The main reason why it’s crucial not to get stuck on the demo is emotions; until you switch to live money, you can’t experience the full feeling of trading. You can get some feeling when trading virtual capital, but what we know from the fact is that over 95% of traders lose the first account, and it’s always due to emotions and bad risk management. I want you to be in that 5% that never lose the trading account, so only open the account around $100, and your max risk for the current month is 20% ( $20 ), this is something that will be enough to check how your emotions impact your trading, and everyone should be fine with losing $20, if you can’t accept that loss try another profession, trading will always involve some sort of risk, and you must accept that.
For trading, I would stick with the system you were practicing on the demo account the previous month. This is not the time to switch strategies. I want you to try following every rule and see how much you can make or lose in the next 30 days.
During this month, you will have, on average, 20-60 trades, so you have time to start writing a trading journal. Take a screenshot of every trade you take and write down a full reason why you entered a trade, why you put the stop loss on that level, and take profit.
You can see a simple example of one trade, we have a chart that shows reason, and we explained in a few lines the reason for play.
Tip: Don’t overcomplicate the trading journal. Make it as simple as possible, you are the only one that will ever read it, and it’s the best way to improve your skills.
Once your challenge is done, go to your trading journal and see your results. See what setups have worked the best and which performed worst. At this moment, I want to see a minimum of 80% of similar results as you had on the demo or, better to tell you, to move to next month’s plan. Here you’ll need to be honest with yourself, don’t worry if you didn’t win the challenge, you lost just $20, and you can try again right away.
Tip: If you have a problem admitting that you are not ready, make a deal with someone you trust the most to be your risk controller. I’m the first person with an issue with this, but after I gave my twin sister to validate my results each month, I started to see big improvements. Remember, it’s hard to admit that you are not good at something, especially if that’s something you like to do. That’s why this part is easier with the help of someone you respect (friend, brother, wife, mom, dad…)
Month 4 Plan – Improve Results On $1000 Account
Trading small accounts sucks, I know it, but it’s necessary to make you a better trader. Since you are reading this part, you showed good results on that “$100 account,” and now it’s time to make trading more challenging. Put one zero to your current balance, so if our small account was $100, we will trade $1000 next (if you started with 50, move to 500).
During the first month of live trading, you won’t have too much data to improve your results, but you will still have some history of your trades. Go back and find similarities between losing and winning trades, and see if you can spot the pattern. Most of the time, new traders will make a mistake in trading the wrong time frame, trading against the trend, trading around the news, tight stops. When you find the reason for the current results, try adding some rules to your system to try preventing them in the future. If you can’t find anything yet, since you have a small number of trades, just move on with the same approach and keep checking your journal once every two weeks.
As we said, we will not change anything big just yet. During month four, the part I want more to keep building consistency and paying attention to risk management. Right now, we have a $1000 account, and your risk should remain %10 (recommendation) or 20%. This way, you will still be ok even if you hit your monthly risk. If you showed a profit in the first month of live trading, this would help prove to yourself that you can make a profit again, and the more time you do something, the easier it will be.
Once this month is over, I would like you to have a minimum of 80% of the similar result to $100 accounts, if not better, since you started to filter your trades. You should be happy with a return between 5-10%. I’m sure that you won’t be happy with a $50-$100 profit. We can’t live from that, but making 5% in trading at this stage is harder than it looks, but you know it by now.
Tip: Don’t focus on making 50-100% return. You want to learn how to constantly earn 5-10% per month. Scaling return is easier than you expect. Think about that: if you risk 1% per trade and consistently make 10% per month for three months in a row, just risking 2% per trade will double your return and move you to 20%. You are here for the long run, so just keep pushing forward.
Month 5 Plan – Analyze Your Trades & Improve Your Strategy
This is the month when you start getting better and better. You now have a library of 50-100 trades in your journal. Again, we want to go and try to find similarities between winning and losing trades. We will try getting some similarities we can use to better filter our trades.
Make sure to re-check all the trades from day 1. I want you to check if you followed all the rules and if your first month’s filter helped you. Once again, we will re-check all rules of our system and add additional filters to push our trading to the next level. The only thing I would love to change this month will be a risk; try 1.5x of your normal risk per trade while your overall risk remains the same max 20%.
After the first two weeks, check your journal, see progress, and check if you need to adjust something for the final two weeks of month five.
You should have the same or better results at the end of the month than in month 4. You should again only procced to next month’s plan if your results are the same or better.
Month 6 Plan – Final Tweaks for Future Carrier
The final month is ahead of us. I know you are all excited, and that’s great! This month you have a few choices to make. You can add more capital to your account if you are satisfied with the results or trade the same account size and growth that way.
This month I would like you to try writing down all the things that you think can be automized in your trading and finding tools that will help you be more productive. You now understand how your system works 100%. It’s time to start building tools that can help you make the same or more profits with the help of automation. Don’t try to go with a full EA (trading robot) that will replace you. That’s not going to work. I’m more saying of building some alert system to help you be more precise with your entries, exits, and risk management.
Building indicators for the most retail platform can be done relatively cheaply. For what you need, it’s going to be a 100-200$ investment. Keep in mind that this is not something you must do, but it will be much more productive for you if you can automate at least some parts of your strategy.
At the end of this month, you should continue to have the same if not better results as the month before. You should continue to tweak your system as much as you can. Try once every two weeks to check on your trading track record, and see if you are getting better or need to adjust something else.
Only when you show a consistent result for six months should you try to learn something new, but don’t forget the first system, go over the same process for any system you want to master, and become a successful trader.
After we are done with our 6-month trading progress and are happy with the results,, you can think about trading for some Prop Company and getting more capital to trade. Don’t worry about trading capital as I always say to my students. Once you are good at trading, you can find capital in 24h.
Conclusion About Our 6 Month Plan
Maybe you will agree or disagree about this plan, but I can tell you that every student who follows this plan becomes a minimum two-time better trader than they were originally. So this plan works for sure, and once you are done, you will have your “trading license” that will move you from point A to point B every time. I challenge you, go try it out, and sacrifice the next six months to prove to yourself that you can become a Successful trader in 2022!
Feel free to send me questions you have during your learning period; I’m more than happy to help others learn how to be profitable traders!
To Your Trading Success,