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Nial Fuller

NIAL FULLER
Professional Trader, Author & Trading Coach

Increase Your Odds of Winning Trades

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By in Forex Trading Tutorials Last updated on | 29 Comments

increase winning tradesIf you put a professional trader in the same room with two struggling traders, all of whom are trading the same strategy and using the same equipment, the pro trader will likely get much better results than the struggling traders. Why? What is the pro doing that is increasing his or her chances of having winning trades? Furthermore, what are the struggling traders doing that is hurting their chances of having winning trades?

You might be surprised to learn that trade entries area just one part of a winning trade, having the confidence to get into those trades and developing “gut feel” is something that gives professional traders an edge over amateurs. There’s both an analytical and a mental process behind success in the market, and you cannot become a consistently profitable trader if both processes are not firing in-line with each other. Let’s discuss what is going to give you this mental edge, and hopefully by the end of this lesson you will have obtained some solid insight into what you can do to increase the odds of hitting winning trades.

Think like a professional trader

Since it’s a fact that you can give different traders the same exact trading strategy and some will get positive results while others lose their money, it’s pretty clear that the primary factors that decide success or failure in the market are the “other things”.

Don’t get me wrong, I firmly believe that having a simple trading method that makes logical sense, like price action, is very important. However, just because you have a simple and effective trading strategy does not mean you will make money, and it’s this point about trading that most beginning and struggling traders seem to not understand. You can’t make consistent money in the markets if you’re not doing “the other things” right…meaning you need to actually follow your trading method with discipline and manage your trading capital properly. If you don’t do these “other things”, even a trading method with a 90% win rate will not work for you.

Amateur traders and losing traders tend to think far more about profits and rewards than about managing risk and the very real reality that they could lose money on any given trade. It really is pretty simple; if you are fully aware that any trade could turn into a loser, you will be very picky about the trades you do risk your money on. If you are aware of this but you are still not picky about your trades, you are simply being careless, this is also called “gambling”.

A professional trader is a skilled risk manager who looks to exploit high-probability scenarios in the market, not someone who blindly gambles their money in the markets with no process or method behind their actions.

A quote from Paul Tudor Jones, one of the traders featured in our Market Wizards article, sums up best how a professional trader thinks:

“I’m always thinking about losing money as opposed to making money. Don’t focus on making money, focus on protecting what you have” – Paul Tudor Jones.

Get yourself into the ‘trading zone’

Often, traders do the most damage to their trading accounts shortly after their previous trade ends. What I mean is this: you just had a nice winning trade, you see your account slowly starting to grow, you feel good about it, but what do you do next? Do you sit there looking through the charts for another trade or do you “close up shop” and walk away for a while? Another excellent quote from the great Paul Tudor Jones sums this point up perfectly:

“Don’t be a hero. Don’t have an ego. Always question yourself and your ability. Don’t ever feel that you are very good. The second you do, you are dead. My biggest hits have always come after I have had a great period and I started to think that I knew something” – Paul Tudor Jones

For beginning and struggling traders, it can be almost impossible to separate yourself from the markets after a winning or losing trade. However, unless you can develop a trading routine of some sort, whereby you are not glued to the markets all day, frantically searching for a trade, you will never obtain the mindset that you need to make consistent money in the market.

Forget about the cliché day-trader sitting at his desk all day making millions, this is not reality and it’s not a good way to think about trading, especially if you’re a beginning or struggling trader.

Manage trades with logic, not emotion

trade with logic“Whenever I enter a position, I have a predetermined stop. That is the only way I can sleep. I know where I’m getting out before I get in. The position size on a trade is determined by the stop, and the stop is determined on a technical basis” – Bruce Kovner.

There are two very important points to take away from the above quote by another “Market Wizard”, Bruce Kovner.

First, he says that he knows where he is getting out before he gets in [to a trade]. Planning out your exit strategy before you enter is essentially how you manage a trade with logic rather than emotion, and managing your trades in this manner will significantly increase your odds of making money in the market. There should be no “surprises” as far as your risk is concerned; when you enter a trade, you should know what your maximum possible dollar loss is and you should never exceed that amount.

Next, Kovner mentions that the “technical” picture is what determines his stop placement. If you understand how to properly place stop losses, you will give your trades the best chance of working in your favor. I get many emails from traders asking about “20 pip stops” or “30 pip stops”, and they clearly do not understand that the market structure and the setup you are trading is what should dictate your stop placement, not some arbitrary number of pips that you “feel” is good.

The fine line between winning and losing traders

You probably have realized that picking a market’s near-term direction is not something you need a degree in advanced calculus to do; in other words, it’s not that difficult. How often do you find that you picked the market direction correctly but “something else” happened and you still lost money or didn’t make very much?

The difference between winning and losing traders is typically not that winning traders hold some “magic key” to trading success or that they have a “perfect” trading system that you don’t know about. It’s simply that they are doing all the things right that you’re not; meaning, they might be trading the same strategy as you, but they trade it better, with more discipline and patience.

As the famous founder of “The Turtle Traders”, Richard Dennis, once said:

“The key is consistency and discipline. Almost anybody can make up a list of rules that are 80 percent as good as what we taught our people. What they couldn’t do is give them the confidence to stick to those rules even when things are going bad” – Richard Dennis.

Professional traders have enough discipline and patience to ride out the bad trades; meaning they don’t get emotional after a loss and stray from their trading strategy. Similarly, after a winner or a few winners, they don’t get over-confident and start entering the market on a whim; win, lose or draw, they stick to their trading method because they know that it’s simply a probabilities game. Statistically speaking, the longer you remain disciplined and stick to an effective trading method, the better you will do. It’s easy to acknowledge this fact, but in the “heat” of the moment after a winning or lose trade, it becomes very difficult for many traders to abide by it.

Thus, if you want to increase your chances of  having winning trades, you have to dig up the necessary discipline and patience to stick to your trading edge no matter what the outcome of your previous trade was. As famous commodity trader and investor Jim Rogers said:

“One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do. Most people – not that I’m better than most people – always have to be playing; they always have to be doing something. They make a big play and say, “Boy, am I smart, I just tripled my money.” Then they rush out and have to do something else with that money. They can’t just sit there and wait for something new to develop” – Jim Rogers

Trust the price action

One of the easiest things you can do to increase your odds of having winning trades, is simply to stop trying to analyze so much trading related information. You will read different things on the internet about whether or not fundamental analysis is important in trading, but at the end of the day, anything that affects a market will leave a price action trail on the charts, this is a fact. That is why I teach “keeping it simple” in regards to your trading strategy; stick with simple price action based strategies and forget about trying to figure out how the latest Non-Farm Payrolls report might affect a market.

Another famous trader that I discussed in my Market Wizards article, Ed Seykota, shares the same view on fundamentals:

“Fundamentals that you read about are typically useless as the market has already discounted the price, and I call them “funny-mentals”.

I am primarily a trend trader with touches of hunches based on about twenty years of experience. In order of importance to me are: (1) the long-term trend, (2) the current chart pattern, and (3) picking a good spot to buy or sell. Those are the three primary component of my trading. Way down in a very distant fourth place are my fundamental ideas and, quite likely, on balance, they have cost me money” – Ed Seykota

Finally, if there is one “key” element to increasing the odds of having winning trades, it would be to trade like a crocodile, by waiting patiently for the easy “prey” trades. Of all the emails I read each week, the number one problem that traders seem to have is that they are not discriminating enough with their trades. Meaning, they either don’t know exactly what their entry signal is, or they know what it is but they are not waiting for it; they are over-trading. Through training and education, like that in my price action trading course, you can learn an effective trading method, but whether or not you experience success in the market is something you will have to decide by doing the “other things” right.

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About Nial Fuller

is a Professional Trader & Author who is considered ‘The Authority’ on Price Action Trading. He has a monthly readership of 250,000+ traders and has taught 20,000+ students since 2008. In 2016, Nial won the Million Dollar Trader Competition. Checkout Nial's Professional Trading Course here.
  1. MUNGE August 13, 2019 at 4:36 pm

    Some points to be highlight patience is key ,not interfering with trades

    Reply
  2. Tom May 4, 2012 at 7:54 pm

    Thanks Nial.
    Am really encourage, though am new to FX!
    Great stuff, God Bless You.

    Reply
  3. Dillon May 4, 2012 at 12:12 am

    This is my first time here, and a lot of the information on your site fits me exactly! I have every single one of these problems…

    This article may have changed the way I look at the market, excellent stuff!

    Reply
  4. Sonja May 1, 2012 at 6:51 am

    You rock Nial, you are THE BEST mentor in the world!
    Keep it going!

    Reply
  5. slivester May 1, 2012 at 1:47 am

    thanks very2 much sir

    Reply
  6. Todor May 1, 2012 at 1:17 am

    You have my bow again, Nial! Everything you teach i find a piece of genius. I should only learn and apply. Thank you very much indeed!

    Reply
  7. julius April 30, 2012 at 9:02 pm

    Nial, All that you listed were the things that choked me.Thank you for always being there. May God bless you.

    Reply
  8. eileen khoo April 30, 2012 at 2:42 pm

    Thank Nial! You had just hit on my obsession and over-analyzing so much so that more often than not I just missed th trade. Will take note and work on that, thanks once again!

    Reply
  9. Kevin(Zach)Harper April 30, 2012 at 9:19 am

    Great Stuff Nial
    Have to totally agree….Be Patient…Be Patient….and then finally ask yourself …Is this really a quality trade setup ???

    Excellent Nial

    Reply
  10. anton April 30, 2012 at 6:33 am

    A++ Article. If you cant grasp the above points then their is no saving you from ruin.

    Reply
  11. pecsen April 29, 2012 at 8:02 pm

    Very useful article again, thank you Nail for your effort!
    In many cases I tried to be patient, but I wasn’t strong enough, so I did some mistakes:
    I checked the charts during working hours, I checked it on mobile phone and modified stop, limit etc. Like others I also do try to reduce the number of my mistakes,
    so first of all I decided to remove the trader application from my phone (however it was perfect, I loved it, but don’t need it), and I started to use weekly charts and the daily. Nowdays I take pending entry (stop, limit) orders and I don’t check the charts for one or two days. I will try to not change the view of the charts to 4h candle, the daily is much stronger and contains everything I need.
    And I wait to close the daily candles. I already haven’t read articles about economy for x month, I’ve spent my time with much more useful things (want to improve my english).
    I’m sure If I’ll not violate these rules, I’ll be much more successful in trading (of course by Nail’s price action) with less effort and less stress and with better english :) Sometimes you have to be strict with yourself (others will not be) during the road to the main goal. Just my two cents! Good luck! :)

    Reply
  12. Yusuf Hammed April 29, 2012 at 5:53 pm

    Nial you are a FX GURU you know how unsuccessful fx traders feel.Every FX trader most learn how to be Patient and looks for Good set up before they enter the market.I like you, you just keep it simple and make it simple.

    Reply
  13. Jerry Snyder April 29, 2012 at 11:48 am

    Hi Nial,
    as always you are right on – I know that I have to keep reminding myself and your timing is remarkable – thanks -jerry

    Reply
  14. Amio April 29, 2012 at 6:33 am

    Very true.What are the antidotes?

    Reply
  15. DRS April 29, 2012 at 5:45 am

    2 years is what it takes to work out the markets.

    Reply
  16. sez elabor April 29, 2012 at 4:25 am

    what can i say Nial? you are the epitome of a professional trader.. this artcle is splendid and good for traders.. you are the best Forex Mentor i have ever known.. thank you a million times..

    Reply
  17. Robert Meinecke April 29, 2012 at 4:21 am

    Thank You Nial for a Block Buster Article. This is exacttly what has happened to me and it is a wake up call for me. You really know how to hit home in such an easy understanding way. I really liked your “Holy Grail” desription about patience. Thank you again.
    Robert

    Reply
  18. Bhupinder April 28, 2012 at 11:42 pm

    Just Brilliant. Thanks for making things easier Nial.

    Reply
  19. AMIN MALIK April 28, 2012 at 11:20 pm

    NIAL! Thank you for being pretty serious in your MISSION of helping Traders at large. For sure, many of us are improving/ developing the proper MINDSET to become a successful TRADER. Your ability to get to the MEAT of the subject is IMPRESSIVE. Please keep coming. THANKS & REGARDS. AMIN

    Reply
  20. Jude FX April 28, 2012 at 9:32 pm

    your articles are very factual for anyone who can follow them. keep it up because you are changing lives!

    Reply
  21. Tay Jui Chuan April 28, 2012 at 8:23 pm

    Hi Nial,
    Thank you very much for this timely article and a very timely reminder.
    Thank you very much

    Reply
  22. hamish April 28, 2012 at 6:34 pm

    todays lesson is bang on and a must for all wannabe successful traders. great insite and knowledge to be gained for all. thanks Nial

    Reply
  23. Ramli April 28, 2012 at 4:52 pm

    Thanks n Cheers

    Reply
  24. John April 28, 2012 at 11:20 am

    Banks and institutional traders sit on the side line, why shouldn’t we. Thank you Nial Cash is a position.

    Reply
  25. Colin April 28, 2012 at 7:54 am

    Thanks Nial thats the best lesson yet. It somes me up what I used to do, But slowly breaking all my bad habits. I am saving all these 5 lessons & will keep going over them just to help me through some rough patches Thanks Nial Great Lesson

    Reply
  26. Oztrades April 28, 2012 at 7:42 am

    Well said. Just topped up my account and am sitting. Missed the big pin bar on the AUD/USD 4 hrly yesterday….. waiting for the next bus to hop on.

    Reply
  27. Isaac April 28, 2012 at 6:18 am

    Great write up, thanks

    Reply
  28. wilson April 28, 2012 at 4:06 am

    Nial excellent theme, the simple is better, thanks.

    Reply
  29. Russ April 28, 2012 at 4:04 am

    Nail on the head Nial!!!! You are a truth bringer!

    Reply
  30. dcsneeden April 28, 2012 at 3:19 am

    Excellent article Nial! If feels like you know all my struggles or maybe you have experienced all of these challenges. I definately need more patience! Thanks.

    Reply
  31. inder sachdev April 28, 2012 at 2:18 am

    Simply amazing!

    Reply
  32. Zahid April 28, 2012 at 1:58 am

    Great article as usual. Scanned the brain, thinking and psychology of the newbi. I have learned a lot through it. Thank you Nial.

    Zahid Malik

    Reply
  33. flash April 28, 2012 at 1:36 am

    I dont often post comments, but it is warranted this time. This one is a duizzie! 10/10! Well done Nial.

    Reply
  34. Pham April 28, 2012 at 12:59 am

    Great article, very useful, I like it a lot, thanks Nial for that!

    Reply
  35. Jeevan April 28, 2012 at 12:33 am

    well said, a lesson to be followed and applied for each traders on their trade, as you always say keep it simple and short – is the key to success i always believe, nice work again,, may this lesson awakes someone

    Reply
  36. Kimbo4x April 28, 2012 at 12:32 am

    Great article. I believe overtrading is part of our “work ethic.”

    Many of us think that if we don’t trade today, we didn’t put in an honest days work. It goes against our “work ethic.” Deciding NOT to take a trade is WORK, too. Work smarter, not harder.

    Looking at Andy’s post, I would greatly appreciate feedback from Nial.

    Personally, I believe in setting pending entry orders. You must be careful, though. I reduce my position size, and I only choose trades where the risk reward ratio is quite high — in fact a set my entry level to increase that RRR (like using a 62% retrace instead of 50% retrace). Also, I only do this in early to mid Tokyo session so the limit order trade has a chance to grow throughout London and NY.

    Kim

    Reply
  37. AndyH April 27, 2012 at 11:57 pm

    Great article. Trying to internalize all these lessons. I often feel compelled to trade because I have a narrow window in which I can. 6PM to 1AM EST when things can be a bit slow. Nial, since we are most clear minded when we are out of the market, would it make sense for us to set up pending orders?

    ~ Andy

    Reply
  38. YangL April 27, 2012 at 11:42 pm

    Technique, patience and discipline are key to win, thank you for your sharing!

    Reply
  39. ed April 27, 2012 at 11:39 pm

    #1 hits the nail on the head! thx

    Reply
  40. cheetu April 27, 2012 at 10:59 pm

    Hi,

    Essentially it says get off the GRQ brain!

    -Cheeti

    Reply
  41. Wes April 27, 2012 at 10:51 pm

    Yea Man! Didn’t start being profitable until I learned patience.

    Reply
  42. onesi John April 27, 2012 at 10:18 pm

    nice article, thanks for all ur service to the trading community

    Reply
  43. samuel April 27, 2012 at 10:04 pm

    What an article! Thanks Nail,prof of price action.This is too good.

    Reply
  44. Kenny R April 27, 2012 at 10:04 pm

    Great Great post Nial. I used to do all that before I learned Price Action trading on a naked chart. I’m making a killing using just one Price Action setup that I can call all mine now. Trading can get pre-school easy when you have a well defined strategy and plan with strict money management. Mix in some patience and discipline and BINGO!!! There’s your holy grail right there. Account is up 40% in 120 days taking a few trades a month of just pin bars! Love it!

    Reply
  45. Chris H April 27, 2012 at 9:51 pm

    Good stuff Niall and I recognise some of thse. You deserve encouragement – there are some dreadful so called mentors out there. Keep it going m8!

    Reply
  46. Chris April 27, 2012 at 9:33 pm

    An amazingly intuitive piece of work Nial. You really hit home. recently I was thinking about what the most powerful weapon in the forex asrenal is and maybe illogically came to the concusion that “you do not have to trade”. No-one is holding a gun to your head and forcing you to trade. So patience, waiting for best opportunity to come along is everything.

    Reply

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