[Reprint: Trading Philosophy from Mindset to Strategy, These 52 Blood and Tears Lessons You Must Know]

Trading is lonely, it is painful, and it is a practice of constant self-doubt. The author of this article has summarized 52 "trading taboos" from mindset to strategy through reading books, learning from smart traders, and countless trial and error in the market. These rules reveal the core of trading success — discipline, patience, and risk management.
1) Never over-invest. When you start losing your rationality. Even if your judgment is correct, over-investing can lead to liquidation, which is the fastest way to bankruptcy.
2) Never trade when you are fatigued or sleep-deprived. Decision fatigue can end a trading career more than forced liquidations.
3) Never trade without a clear advantage. Entering the market without an advantage is just unnecessary gambling. If you can't explain your advantage in one sentence, you probably don't have one.
4) Never open a position out of boredom; frequent trading can lead to poor returns. Many times, sitting on the sidelines is the best strategy. If you find yourself forcing a trade just because "you don't want to be idle" or "haven't traded in a while," please reflect on yourself in time. Trading for the sake of trading will lead to hasty decisions and losses. The market does not reward those who trade the most, but rather those who profit the most. Sometimes, not trading is the best trade.
5) Do not continue trading after experiencing significant losses. At this point, emotions can easily get out of control, and you may try to recover your losses with an irrational bet. This eagerness to recover your losses is bound to lead to even greater losses.
6) Never enter a position without a clear exit plan. Whether it's a time-based stop loss, price stop loss, invalidation condition, or catalyst-driven exit strategy, it should be determined before opening a position. Remember, the last moment for traders to maintain objective judgment is before placing the order. Once in a position, admitting mistakes can become exceptionally difficult, so it's essential to set the conditions for stop loss exit in advance.
7) Avoid stubbornly holding onto your position. The market doesn't care about your beliefs. Either cut your losses or get liquidated.
8) Never trade based on profit and loss; trade based on the market itself. Rushing to recover losses or being entangled in past profits can cloud judgment and interfere with execution.
9) Not all opinions are worth trading on. The best trade is often not to trade at all. Preserving funds and energy until the situation is favorable is more important than acting forcefully.
10) Do not go against the trend. The tide is stronger than you. Adapt to it, or you will be eliminated.
11) Never attempt to catch flying knives. "Cheap" can always be cheaper.
12) Never violate trading rules or deviate from your plan in a moment of emotional impulse. Your rules exist for a reason, often stemming from painful lessons learned. Once you try to convince yourself "just this once" and ignore a rule (such as moving a stop-loss, doubling down, or trading too large a position), you will head towards chaos. Discipline is about doing the right thing even in tough times. As a trading proverb says: "Plan your trade and trade your plan."
13) Never fire all your bullets at once.
14) Never trade when you feel uneasy. If your position size is too large, you will fall into a whirlpool of panic decisions, constantly imagining that the market or certain forces are trying to force you to close your position, leading to a state of nervous tension. The truly wise approach is to let a good night's sleep become a natural measure for determining your trading size.
15) Never let your ego trap you in a bad trade. Acknowledge your mistakes: cut your losses in time, adjust your strategy, and move on.
16) Do not underestimate the reflexivity of the market. Strong assets can always reach new highs, while weak assets can always reach new lows.
17) Never expect liquidity to appear in time when you need it. The exit channels are always narrower than you think, and liquidity is not in your control, but determined by the market.
18) Do not treat random market fluctuations as a trading strategy. Buying simply because the price has gone up, or shorting just based on a "feeling that the price is too high," is not real trading but rather blind gambling behavior. Even if you have a well-established risk control mechanism, if your entry decision lacks fundamental support, you will ultimately suffer gradual losses.
19) Never make the same mistake twice. Trading errors are inevitable, but repeating mistakes is unacceptable. Never lose the same way a second time.
20) Never forget to defend yourself properly. Making mistakes is acceptable, but stubbornly sticking to them is not. Protecting your principal should always be the top priority. Don't just think about making money; focus on protecting your existing assets.
21) Never focus solely on offense; staying alive is the most important thing. If you don’t bet, you can’t win. If you lose all your chips, you can’t continue to bet.
22) After a major success, do not fall into the trap of lifestyle inflation. When you start estimating your annual income based on a lucky successful trade, problems will follow.
23) Never forget to switch to a defensive strategy after a series of profits. Huge losses often occur after a string of victories, when overconfidence begins to creep in. Stay humble; your last big trade means nothing to the market.
24) Never let pride and arrogance take the upper hand; always maintain humility.
Do not trade under uncontrollable circumstances, such as during the FOMC meeting, 25).
26) Never be complacent. A strategy that works in one market environment may fail in another. Trading is an art that requires continuous improvement, and the comfort zone is often the enemy of profit and loss. Never think you can predict the market direction.
"There are two types of predictors: those who don't know, and those who don't know that they don't know." Never assume that your advantages will last indefinitely. The market is evolving, advantages will fade, and methods that were effective in the last cycle may be completely ineffective in the next. Keep your strategies iterative, continuously validate and scrutinize; stagnation is equivalent to self-destruction.
27) Never average down a losing position after your logic has been proven wrong.
28) Do not trade with certain expectations, but trade with firm conviction.
29) Never assume that the market "must" operate in a certain way, especially based on recent trends. The market is under no obligation to continue a trend or follow logic. Even if the market continues to rise (or fall), it may suddenly reverse. In trading, avoid using absolute statements like "certainly" or "impossible." Maintain a flexible mind and logic; anything is possible. Remember: never make an "always" conclusion about market behavior.
30) Do not regard win rates as everything. Deliberately pursuing a high win rate for the sake of feeling good is a trap. Cashing out early or avoiding necessary small losses will ultimately harm profitability.
31) Never underestimate the importance of discipline, patience, risk control, and execution ability; these are more important than simply pursuing Alpha returns. Many traders hold high-quality Alpha returns but do not know how to manage them. Excellent execution is not only about choosing trading targets and strategies but also knowing when to hold back. When the market environment is unfavorable, the best execution decision is often not to trade. Always ask yourself: "Do I have an advantage here, or am I just betting on the outcome of a coin toss?" If it’s the latter, conserve your strength and wait for a better opportunity.
32) After a significant loss, do not be disheartened; during a big win, do not become complacent. Emotional resilience is the most valuable asset for a trader.
33)Never ignore the price movements after a news release. If the market reaction is contrary to your expectations, exit immediately. The market is conveying information to you that you have yet to perceive.
34) Never trade on borrowed beliefs. If you buy based on someone else's advice, you will also need them to tell you when to exit, and when they go silent, you will be in trouble. As Livermore said: "No one can make big money relying on what others tell them." Hone your own skills and build your own system. If you cannot trust your own decisions, you are merely a pawn in someone else's trades.
35) Never go against your intuition. If something feels off, it usually is.
36) Never try to catch every market fluctuation.
People are always tempted to chase every rise and fall in the market, but this approach is destined to be futile. Always approach the market with an abundance mindset rather than a sense of scarcity; it is always there, with ample opportunities to help you achieve your goals. You don’t need to swing at every pitch like a batter.
37) Never underestimate the power of failure. As long as you persist, failing early and often will lead to continuous improvement.
38) When your investment rationale is no longer valid, do not hold on to losing assets, especially after a price crash. The thought of "I've already lost so much, I can't sell now" will lead you to ruin.
39) Do not let the "recouping mentality" dominate your decision-making. This way of thinking can lead to overtrading, ultimately resulting in a complete liquidation.
40) Do not focus solely on the entry timing. A trade is only considered complete once you exit. Knowing when to cash out and exit is just as important as knowing when to enter.
41) Do not ignore those seemingly "boring" aspects (position management, stop-loss settings, risk-reward ratio), as they are the key to your foothold in the market. Don't wait until you encounter catastrophic losses to understand this principle.
42) Don't trade for temporary excitement; aim for steady and solid victories.
43) Do not fall into the illusion of great power, as that is often just a lag in reality.
44) Never stay or get trapped in a situation because of "hope" or wishful thinking.
45) Never underestimate the importance of risk management. Always prioritize the safety of your principal over chasing profits. Manage your losses well, and profits will naturally follow.
46) Do not enter or exit the market rashly. Just as you build your position gradually, you should also reduce your position gradually; a "full in and full out" approach is tantamount to self-destruction.
47) Never make a bet you can't afford to lose. The size of any single trade should not be so large that it forces you out of the market. The most important advice is to never let losses get out of control. Even if you make mistakes 20 times or even 30 times in a row, you should still have remaining capital. Never let a single position jeopardize your trading career.
48) Never trade outside of your edge. If you don't have an edge, choose to wait. Forcing trades outside of your own trading system will only lead to a gradual loss of account funds.
49) Never assume that your advantages are permanent. The market is evolving, advantages will fade, and strategies that were effective in the previous cycle may become useless in the next cycle. Continuous improvement and continuous testing, while stagnation is self-destruction.
50) Never judge a trade solely based on the outcome. A good trade can sometimes result in a loss, while a bad trade may luck into a profit. Focus more on execution rather than results.
51) Never hold on to a position out of fear of looking foolish or concern for public opinion. I have seen too many people ruin their prospects too early out of fear of public humiliation; making quick decisions to cut losses is the way to survive. The market never cares about your pride, and you should learn to let go of your ego.
52) Never underestimate the power of temporarily stepping back. When you are stuck in a losing streak, decisively liquidate your positions and take a moment to regroup. Psychological capital is just as important as financial capital; the key is to break the vicious cycle of negative emotions. Upon returning, keep a low profile, simplify your scale, and wait until you regain your confidence before increasing your bets.