As a trader you need rules. One could also say that a trader needs a plan. The trading rules/plan will protect a trader from making decisions that he would otherwise not have made. Sometimes the stressful moments of the markets may disrupt the thought process. It is at those times that rules will tell a trader what to do.
Sometimes, the most simple and basic ideas can lead to better performance in trading. As we know, trading is a lot about having rules and obeying them. Maybe, when those rules are complex or can be bent, it's more likely that they will be broken. A simple rule has therefore a good chance of being applied in a very rigid and disciplined way. In this article, I will share a very basic and easy rule that I use and have used for quite some time now. I call it the One-Trade-Per-Day rule. As you can guess from the name, that doesn't sound like a very ingenious idea. And it isn't, but it works.
Before taking a trade, you should have done your analysis. If the analysis shows that the trade has a high probability of being successful, you enter it and see what happens. Now suppose the market moves away and your position is getting worse. No real problem, there is never any guarantee the analysis will work.
When I think about trading rules, the first thing that comes to mind in less than 0,047 seconds is: always use a stop loss. Everyone knows this saying of 'Cut your losses and let your profits run'. That is of course easier said than done and this article is not about that. This article is essentially about accepting a loss.