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Anatomy of a Profitable Trader

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What does a successful trading program actually look like?

How do you know if the strategy will perform well over time, given enough occurrences?

What behavior is required to produce a positive slope in the equity curve, with minimal variance?

These are the questions I ask myself on a regular basis, because my main concern withtrading for a livingis,consistency.

The last thing I want is to have it all at my fingertips, only to have it taken away by a few massive losses.

That is why I stress the importance of activelycontrolling risk and minimizing exposure to large intra-trade losses.

There is a popular (bad) method out there where you risk a large percentage of your portfolio in order to increase the percentage of profitability. This looks good on paper and feels good in real life when you see 99% profitability. Your new guru is your hero, until the 14 day refund period runs up, and your account explodes. Your guru is now nowhere to be found and your investment has vanished.

The problem with this is that your risking a large percentage of your account to produce those results, and one loss will spike your PnL graph to the downside.

Weeks, or Months of gains are down the drain and you are back to square one.

I don't want to see that happen to you.

Being in this position of making videos and selling my products has allowed me to meet dozens of other traders, with many unique stories.

The one I hate hearing most is about the well capitalized trader that spent tons on education, spent countless hours learning and has been losing money for the past x years. He is questioning if trading for a living is even possible. They are perhaps also questioning there sanity at this point as to why they cannot give up.

I have seen the most dedicated professionals give the same certainty of success and resources used in starting a multi million dollar corporationinto their own personal trading accounts, only to walk away years later dazed and confused as to how it just didn't work out for them.

I wan't to see you succeed.

Now, they say there are many ways to skin a cat, or do anything for that matter. However, I want to give youa few tips on how to produce an equity curve that has a positive slope, with long-term consistency (and without being a quant).

Relax, put the notepad away, it isn't some complicated formula for finding trades; it's more about you, the operator.

1. If 2017 was a losing year for you, begin trading SIM for the next 3-6 months.
You will learn the agony of waiting hours for a good trade, only to know in the back of your head its a SIM trade and you could have made all that money if you hadn't taken my advice. Learn to get over this, quickly. you must learn to rid yourself of that sickening feeling that will only skew your decision making ability.

2. Stop trading for the money,trade for the challenge.
My goal is to reverse engineer a positive slope in my equity curve with minimal variance, or volatility. Do this and becomes a game, and allows you to make more objective decisions.

3. Pick a strategy, system, or method, and stick with it.
Jumping around with a new trading tool every other day is the worst thing you can do. Pick one, refine it and become an expert at it. You cannot create consistency if you are starting over with a new method so often.

4. Invest in yourself.
If you invest in yourself you will expand your horizons, new ideas for profitable strategies will come to you. You may even see the same old indicators from a new perspective.

5. Do the math.
Know how much you need to start with to trade for a living. Calculate the margin and contract quantity for your strategy. Also consider the annualized return you are aiming for, is it realistic based on your starting capital?

6. Don't quit your day job.
Trading Futures with a day job is probably advantageous to most because it keeps you from being involved with the hype of over trading. I suggest swing trading by checking charts after work for daily bar opportunities. The good thing with Futures, unlike the stock market, is that Futures trade nearly 247 with minimal spread.

7. Don't use stops (yet).
Always allow a trade to move against you once, but not twice. The price bar for the time frame you are trading should be allowed to probe for stops, but not close outside of your would be stop loss level.
After the suckers have their stops taken out, and price goes in your intended direction, put the stop in. If it closes hard against you right away then take the loss immediately, as it is likely to continue. Be sure to include this added short-term risk in your capital allocation.

8. Become obsessed.
Yes, become an obsessed freak about what you will being doing for a living. Pick one market you want to master and watch it like a hawk. Become an expert until you can recite from memory what the market did that day, at what time, and at what price.

9. Meditate.
Meditation is great because it helps you become more self-aware of your thoughts and emotions. You'll be able to better stop yourself from entering (or exiting) a trade due to fear of missing out (FOMO), or greed for more.

10. Invest in your health, change your diet, change your habits, change your life.
Are you disciplined enough to stop yourself from having something that's bad for you, even though it may make you feel good in the short term? Did you want to stop eating those damn cookies, or stop smoking those harmful cigs but somehow it just never happens? These bad habits will eventually bleed over into your trading. Learn to master yourself before you attempt to master the markets and I guarantee you will thank me later.

OK, now that we've gotten through the psychological aspects...

Here's what consistency looks like.

The majority of our Day-Trade Winners reach aprofit of $300per contract.

MFE (Maximum Favorable Excursion)
Price behavior in the trade signals intended direction.
Min. : 0.00
1st Qu.: 13.75
Median : 165.00
Mean : 305.55
3rd Qu.: 397.50
Max. :1393.75

The majority of our losers reach aloss of $97per contract

MAE (Maximum Adverse Excursion)
Price behavior against the trade signals intended direction.
Min. : 0.00
1st Qu.: 30.00
Median : 80.62
Mean : 97.06
3rd Qu.:142.50
Max. :450.00
Our winners are about3 times the size of the losers.

While you work on perfecting your trading strategy, you can follow my work tokeep you involved in the markets.

Allow my trade signals to be your mentor.

Watch them closely, see where it got in and where the stops were placed. Do your research and identify what makes a good trade, and what makes a bad trade. Become an expert.
Do you Trade Part-Time?
SMS text alerts are likely the best bet for you.
If you work full-time and youhave remote access to your PC, or a mobile app for trading,then you can enter trades based on the text alerts sent to your phone from our system.

Trade frequency is limited to only a few trades per week so it wont be a hassle.

Want to fast track your performance, without the learning curve?
SMS text alerts are likely the best bet for you.
Know exactly when to enter a trade based on our algorithmic signals. Either follow our signals exclusively, or utilize them as a diversification tool to assist in leveling out your equity curve.

Best Regards,
Bruce Levy, Head Algorithmic Trader.

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About the author

Bruce Levy

Bruce Levy is an independent Futures Trader.  He is currently a Level 1 CMT with the Market Technicians Association and subscribes to the recognized methods of Classical Technical Analysis. He specializes in adapting directional outright trading systems to ever changing market environments. The strategy's vetting process involves identifying tradeable patterns through keen market observation, once patterns are discovered they are mechanized for further analysis. Those that meet rigorous criteria are then automated into an algorithm and quantified over a robust data set prior to use in the traderoom.

Bruce shares his extensive work through the FuturesTradeRoom screenshare, his Automated Day Trading Programs are streamed on a 24/6 basis. In addition, the system involves no human intervention whatsoever and the trades are executed on the chart trader for all to see. He also writes a Weekly Futures Market Update Newsletter which focuses on Daily and Weekly chart formations. His analysis includes a unique blend of Volume Profile, Price Action and Classical Technical Analysis.  

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