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Here are the 12 most important rules in the world of trading. Adhere to them to build your wealth.
2 days agoLast update: 07/27/2025
0526 3 minutes
Profit in this world is not a coincidence, it is a system.
Many people enter the market with the dream of getting rich quick, but they exit with huge losses because they treat trading as a game of chance.
The truth is that professional trading is like running a business, with strict principles and rules. I've summarized the essence of this experience for you in 12 laws that, if mastered, will take you from the 90% to the 10% club.
Axis 1: The foundation of success - strategy and advance planning
Before you put a single dollar into any trade, you must build your fort. That fort is your plan.
Law 1: Focus on one weapon until you master it.
Don't get overwhelmed by dozens of strategies, choose one clear strategy, such as trading using moving averages or Japanese candlestick patterns, and dive into it.
For example, if you choose a moving average crossover strategy (e.g., a 20-day moving average crossing a 50-day moving average), practice it on a TradingView demo account 100 times.
Understand when a signal is strong and when it's false. Mastering one strategy is better than having a superficial knowledge of ten.
Law 2: Don't go into battle without a map. Every deal is a mini-battle.
Entering without identifying your three key points is financial suicide. Before pressing the buy or sell button, you should have these numbers written in front of you:
Entry Point: The ideal price confirmed by your strategy.
Stop-Loss: Your last line of defense. It's the price at which you admit your analysis was wrong and exit with minimal damage.
Take-Profit Target: A take-profit point that you set in advance based on resistance levels or your strategy objectives.
Law 3: Go with the flow, not against it.
One of the easiest ways to lose money is to “swim against the tide.” If the overall market trend (for example, Bitcoin) is upward, focus on buying opportunities.
Use simple tools like moving averages to determine the overall trend on larger time frames (daily or weekly).
Trading against the trend requires a high level of experience and greater risk.
Law 4: Your position size is your capital shield.
Never risk more than 1-2% of your total capital on a single trade.
If your account has $10,000, your maximum allowable loss on any trade is $100-$200.
This law is what separates a professional trader from a gambler. It ensures you stay in the game even after a series of losing trades.
Axis Two: The Battlefield - Discipline and Emotional Control
The hardest part of trading is not analyzing the chart, but controlling the beast inside you: your emotions.
Law 5: Accept Loss as Part of the Job
Every successful trader, from Jesse Livermore to the present day, has had losing trades. Losses aren't failures; they're an operating cost in this business.
Don't turn a small losing trade into a major disaster by clinging to hope. If the price reaches your stop-loss, close the trade immediately. Ego and greed are your mortal enemies.
Law 6: Don't trade out of boredom. The market is not a casino.
If there isn't a clear opportunity that aligns with your strategy, the best decision is to do nothing. Random trading just because you "feel" the market will move is the quickest way to destroy your account. Patience is a trading principle in itself.
Law 7: Control Fear and Greed
Fear makes you close a winning trade early, leaving a lot of profit on the table.
Greed makes you chase unrealistic goals or increase your position size after a winning trade, exposing you to greater losses. The solution? Your written plan. It's the rule of thumb, unaffected by your emotions. Stick to it strictly.
Axis 3: Growth Engine – Continuous Learning and Development
The market is constantly changing, and if you don't evolve with it, it will crush you.
Law 8: Make chart reading your daily habit.
Dedicate 30 minutes each day to analyzing charts, even if you're not trading. Open TradingView and study Japanese candlesticks, identifying price patterns like head and shoulders or double tops.
This daily practice is like training a muscle; over time, chart reading will become a second language to you.
Law 9: Your journal is your own teacher.
Record every transaction you make:
Why did you come in?
How did you feel?
What is the result?
This journal isn't just a record; it's a powerful analytical tool. After 50 trades, you'll notice patterns in your behavior. You might discover that you always lose when you trade late at night, or when you deviate from your plan.
Law 10: Learn from the Giants
Read life-changing books for traders, such as "The Disciplined Trader" by Mark Douglas. Watch interviews with successful investors. Learn from their mistakes and successes. This saves you years of trial and error.
Law 11: Conduct a weekly review of your performance.
At the end of each week, sit down and analyze your performance.
How many deals have you made?
What was the profit to loss ratio?
What is the most common mistake you make?
This weekly review is your compass to continually correct your course and improve your strategy.
Law 12: Learning Never Stops
The world of crypto and financial markets is evolving at an incredible pace. What worked yesterday may not work tomorrow. Follow trusted experts, learn about new technologies, and always be open to developing your tools and knowledge.
One last piece of advice from a trader to a trader
Always remember, trading is not a race to riches, but rather a building of a castle with your capital, brick by brick. Patience and discipline are the cement that holds this castle together. Start with capital you can afford to lose and devote your time to learning before risking large sums.
Which law do you find most difficult to comply with? Share your thoughts in the comments.
Save this post as your daily reference, and follow us for practical analysis where we apply these laws to real charts.