Maximizing Trade Potential, Zella Scale Update, and Trading while Working 9-5!
How can I maximize my trade's potential?
We’ve all dealt with this before...
The annoying moment when you exit a trade only to see it continue WAY further your direction.🤦♀️
You look back at the trade and you’re like “Wow, had I held for just a minute longer I could have doubled my money.” 🙇♂️
Some traders start to get frustrated. Some take revenge on the market. 😬
Some go into tilt mode and gamble away their ports. 😨
Some let it impact the rest of their trades for the day.😓
Some take it a little better and simply see it for what it is. These are the folks that are happy with the piece they caught and can move on to the next trade.😎
This phenomenon is as infuriating as it is inevitable in your trading career.
The bad news?
There’s not much we can do to stop this from happening completely.
It’s always going to happen. 🚨
You’re probably thinking, “Ugh, Zella, will you tell me some good news?”🙇♂️
The good news!
While this phenomenon is always going to be present in your trading, there are ways that you can use your past trades to paint a better picture for your future trades by further maximizing the potential behind your risk.
We touched on this a tiny bit last week...
If the words “MAE/MFE” are giving you Error 404 vibes, we’ll jog your memory.
🔘 MAE stands for Maximum Adverse Excursion.
🔘 MFE stands for Maximum Favorable Excursion.
Both MAE and MFE refer to price relative to your trade.
MAE represents the LOWEST price the instrument went to during your trade (assuming a long position this example).
MFE represents the HIGHEST price the instrument went to during your trade (again, still assuming we're going long).
One way you can utilize this metric to ensure you're MAXIMIZING your trades is to analyze your trade's spot on this scale over time. 📊
Let's say your trades consistently favor the green end of the scale. If this is the case for you, it's likely that you're able to tighten up your stop loss location. 📋
The MAE/MFE scale will tell you how often or if price action tends to hang out around your stop loss level.
If it most often doesn't, then you know that you can risk less to make the same reward- thus, improving your trade expectancy. ✅
Use the MAE/MFE scale in conjunction with other TradeZella tools such as Running P/L.
Your running P/L will give you an idea of several factors, but one of them is how right you were on the timing of your entry. 📈
If the trade moves in your favor right away on most of your trades, you can use this data to tighten your stop loss.
Or, if you're finding that perhaps you're a little red or breakeven at the start of your trades you can still tighten your stop loss if the data is displaying this to be consistent.
Plus, now you know you might work on fine tuning your entries!📝
While of course you want to give yourself room for the trade to play out, if you can refine your strategy, you'll see great progress in your performance and bottom line. ✅
Zella Scale's new facelift
Zella Scale is completely re-vamped and ready for you. 😎
Check this out...
In this example, the shaded part represents the outcome of your trade.
At one point in this trade, you could have taken maximum profits at $322, rather than $184.
Hovering over the red value would display the amount you were down at one point.
This can be helpful in determining if you often leave profits on the table. It can also display the true amount you risked while in the trade.
This is just a taste of one of the features in our roadmap for 2023. So much more to come!
We'll be posting more about this scale in future issues, so stay tuned!
Check out Zella Scale and tons more features to elevate your trading here:
I learned to trade while working a 9-5
Many of us started trading while having other full-time responsibilities on our plate.
Can you blame us? 😅
Wanting to get more out of life on top of our routines?😎
This week, we got the chance to interview one of our active TradeZella members, Jeremy.
He's been at it since 2021 and still working on perfecting his craft. Jeremy is passionate about markets and specifically the visual aspect, price action and charting.
Let's hear more about his experience with trading.
The Road to Success
Summer of 2021 marked the very first inkling of trading in Jeremy's timeline. 👶
Sure, he heard about the markets and even participated in his employer's 401k, but it wasn't until he was introduced to options that his interest expanded into short-term trading.
Jeremy mentioned that the pandemic allowed him to work from home and achieve some extra free time during the day. ⏰
He decided to take a leap of faith and soak up as much trading education as he could. 📝
He started out in various discord groups and then took it to the next level when he hired a mentor to give him an extra boost. 🚀
Early 2022 brought profits here and there but it wasn't until August of last year when Jeremy found consistency. 🙌
Amazing ramp up time here!
Most traders take 1.5-2 years to find progress, whereas Jeremy was one of the early ones! ✅
Also, taking up another challenge in the midst of the pandemic...
What a way to see opportunity in distress! 👍
Jeremy mentioned that in hindsight, his biggest trading mistakes was trading live before he knew what he was doing. 😅
This is quite a common mistake amongst folks new to the markets.
💡 Day trading is an extremely difficult endeavor. It is highly recommended to start out with a simulator rather than your real money.
- You're bound to make some mistakes even just learning the platform.
- You haven't received any educational foundation yet
- You're competing amongst tons of other traders that are more experienced.
- You'll lose more capital overall and quicker.
- You haven't tested out any strategies yet.
"Like most traders, I lost money in the beginning and fell into the rabbit hole of trying to make it back quickly.
While live funds are the only way to tackle the emotions that come with trading, I always recommend paper trading to develop a profitable strategy first."
Couldn't agree more!
Jeremy also talked about utilizing TradeZella as a tool for growth.
"I use Tradezella because it’s the most comprehensive solution that I’ve found for journaling trades.
More specifically, I enjoy the ability to review my trades with respect to risk/reward instead of money and Tradezella allows me to easily do that."
Viewing your trades through the lens of R-Multiple is one of the main reasons many folks sign on to TradeZella.
By translating your performance into R-Multiple terms, you're able to get a clearer picture of your actual results, rather than the money you made or lost.
Using R-Multiple as opposed to P/L will also come in handy when you decide to scale up your trading.
If you're down to analyze your trading the right way, you can sign up for TradeZella here and get instant access:
As far as 2023, Jeremy is prioritizing health and wealth. 💪
He started the 75-Hard challenge alongside some friends with the goal to improve his diet and exercise routine.
Consistency breeds consistency! 💯
We're rooting for you, Jeremy!
Stoked to see your future progress.
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