Day Trading Discipline

If you have read any of my previous articles here on the website, or even if you have listened to more than a few of my videos, then you have most certainly heard me say that trading itself is not really that hard, but in fact, the reason there is so much failure in this business is because most people are not disciplined enough to succeed in day trading.  The issue that creates such a lack of success is the inability to follow a trading plan, and this is why discipline is so important in price action trading strategies, or any trading strategy for that matter.

Day Trading Discipline
Day Trading Discipline

Personally I believe that anyone that is making money consistently as a trader understands how to read a price chart, and that’s where price action trading becomes important.  Even if a profitable trader uses an indicator or even if they have some private technique that they have created on their own that is not public, there is no way to make money on a consistent daily basis using that alone.  Even if profitable traders don’t realize it, they have learned to read a price chart, or else they are not making money.  There simply is no way to make money trading without the ability to understand prices, which is what we call or describe as price action trading.  Price action trading is simply using the prices as they print to the chart to know and understand why prices are doing what they are doing and most importantly, to understand what prices are going to do next.

Hopefully we have sold you on this fact and that you do not disagree, because if you do not agree, you still have a long journey ahead of you as a trader.  However, even if you do understand and we have convinced you of the importance of learning to read a price chart, now comes the hardest part of trading, and the real reason most never succeed.  Once you learn to read a price chart, you have only conquered half of the success equation that is needed to make money as a day trader.  The second half of the equation is related to your emotions and your ability to remain disciplined and not allow.  You can not allow your emotions of fear and greed to interfere with your trading decisions.  No matter how disciplined you are in the rest of your life, you are not going to be able to translate that same success to day trading immediately.  Your previous success at discipline may speed up the process or learning curve, but it won’t ensure your success, I can assure you of this fact.

Below is an excerpt from a trading document that we found at  This PDF discusses the importance of discipline and gives a solid over view that we thought was worth sharing with our readers.  Here is a small portion of what that article has to say about discipline.

The success that a trader achieves in the markets is directly correlated to one’s trading discipline or lack thereof. Trading discipline is 90 percent of the game. The formula is very simple:Trade with discipline and you will succeed; trade without discipline and you will fail.

I have been a trader and member of the Chicago Board of Trade (CBOT) for 20 years.

During my successful pit-trading career as a scalper, I traded in three different contract markets: 30-Year Treasury bonds at the CBOT, the S&P 500 at the Chicago Mercantile Exchange (CME) and the Gilts at the London International Financial Futures Exchange (LIFFE). Currently, I also trade the electronic $5 Dow futures contract on the CBOT as time permits.

Although my formal academic education consists of a bachelor’s degree in business administration from the University of Denver, I never considered myself to be an extremely gifted student. I have no formal training in market technical analysis. I’m unable to even set up a Fibonacci study or Moving Average study on a charting package, let alone know how to trade with such data. I have no formal training in market fundamental analysis. I don’t understand the economic causal relationship between the actions of the Federal Open Market Committee and Treasury bond prices or equity

How, then, have I been able to succeed, day after day, trading the markets for more than 20 years? The answer is simple: I trade with discipline, and I respect the market. When I’m wrong I get out immediately, and when I’m right, I don’t get too greedy. I’m content with small winners and I’m accepting of small losers.  You can read the rest of the original document here. UPDATE: This document is no longer available as the website appears to be dead now. Too bad because this was a great article, but the basic points are still made right here on this page.

I really like this guys thinking and if I didn’t know better, I would have sworn that I wrote the information myself or that he copied the information directly from my mind.  Of course that’s not true, but it feels that way because he thinks exactly like I do and he words it so similar to me that it really could be me saying it or writing it down into words.  If you get time, make sure you follow the link and read the entire PDF.  In fact, you should print it off and read it time and again until it is ingrained into your mind.  This guy is a real trader and he is sharing real information with you that is critical to becoming a trader and he is sharing it with you for free.  This is like finding a gold nugget on the ground and picking it up and taking it home with you.  It’s valuable information that you could not buy in most cases, so take it and use it to your advantage!

If you learn to read a price chart or if you learn price action trading, which are actually both one and the same, and you then take this gentleman’s information and study it until you understand how and why discipline is so important to price action trading or any trading plan for that matter, you will be well on your way to becoming a profitable trader.  I can say this without hesitation, and if you never take any of my advice otherwise, then don’t let this information slip by you without taking advantage of it.  Understand first and foremost that no matter what technique you use to trade the markets, you must learn to have discipline before that trading technique is going to make you money on a consistent basis.

You have the key ingredient now, which is to learn trading discipline, but if you want to learn how to read a price chart like a pro, then you need to learn our price action trading strategies.  If you would like to learn price action trading, you can find more details at

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Joe November 6, 2015 at

Original document link no longer available

JON December 8, 2015 at


katana December 8, 2015 at

The original was published in SFO many years ago; I have been unable to find a reprint and the author passed away in 2009 (interesting side note you can still read his posts on elitetrader – user name ZAL).

I believe between these two links you will have the full, original, content.

Shaun April 8, 2016 at

Very much appreciated “katana” well worth the read.

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