I do not see the point to discuss psychology of the people who do not know what they are doing. Some sort of masochism... Why they still trading? Because they were told that anyone can do it.. just read this book, or listen to this mentor.. and you will develop an edge.. Edge my a$$.... Instead, some one should tell him: "Buddy, you know nothing, and you probably never will know enough to trade better than most. And while you are like everybody else, you are a sucker... like everybody else... Keep that in mind !"
People are different kinds of traders, so I guess it depends. For example, I trade some longer term trends. I expect some losses. With such a system, twisting yourself into a pretzel trying not to lose results in cutting off winners too early. You are better off getting out when your trend is broken and finding something else that's trending. And yes, you end up holding stuff when it has gone way up and you feel crazy for doing it. However, you have to obey the trends. Otherwise you are not trading a system--you are trying to predict the market based on your so-called gut feeling, something that no one can do. I believe that people who claim they can "feel" a market are unconsciously using some observable signals. Other people may trade different types of systems. Maybe those work differently.
Losses are part of the game but what matters is how a trader ends the day, week, month or year. The result should be @ profit and if not at profit...the trader needs to fix (revise) whatever is preventing he/she from being profitable. Simply, losses should be minimized and encourage us to perform better. Just as important, if someone is consistently getting losses or consistently losing money by the end of the day, week, month or year...they should stop trading and revise their trade strategy or revise their trading plan or revise their attitude (perceptions) about trading. This revision may involve the trade strategy or money management or discipline or trading environment or perception about trading and any other variable that has an impact on our trading results. If the revision process fails...they need to conclude trading is not for them and find something else. Those that encourage losing traders to keep trading with real money instead of encouraging them to take a step back to fix things (trade strategy, trading plan or themselves) often have hidden agendas or their just selfish because it makes them feel good about their own performance. Losing traders should just stop, do the revision process instead of listening to anonymous folks online that encourages losers to be losers.
I trade one minute bars and some times down to 20 second when volatility extremely high, I also trade long term using decade/yearly/monthly/weekly/daily/two minute, four years ago I discovered a concept based on not losing, so I design all methods that rotate this concept, do I have losses, you bet I do and sometimes quite large. Did it reduce holding period on longer term methods? No, it actually forces to stay in longer, some commodity trades been in over five years, have rollovers. And I average down now on all timeframes, and no, I will not own the world some day. Happy making what I make and steady growth. You don't have to obey trends, you obey your Trading Plan. So if you are trading a decade trend, you think there be many change of trends?
Here's a question to help me to avoid having losses lead to over or revenge trading. Let's say during the day I have decided if I have 2 winning trades at the start of when I am trading in a row, I will quit for the day. Therefore that leads me to this if I have 2 losing trades in a row, I will quit for the day. The objective being that on my losing days I will not end up having an overall bigger account loss than my account profit on my winning days. Now on to the questions: A) Let's say I have 1 winning trade and 1 BE trade. Do I trade another 2 trades, do I trade just 1 more trade? Or just stop trading for the day. B) Now let's say I did 2 trades, and I end up overall BE minus commissions, do I trade another 2 trades, or just 1 trade. Or just stop trading for the day.
sounds more like some kind of religious, superstitious numerology, than a trading plan. What is magic about the number 2?
There is nothing magic about the number 2. My goal is to use stats to correctly determine the number of trades that will prevent a winning day's profit to be less amt than a losing day's losses.
I have to agree with some of the people on here and say that I also hate the losses. I mean they are pretty much the worst. I always get worried that I'm going to start losing too much money and then I won't have any left. That is why I started using demo accounts so that I could help myself out. They honestly helped me out a lot in the long run. I have to say that I'm very happy with them because they are essentially a virtual trading platform where you can buy and sell various currencies without risking real money. In providing this service, Forex brokers replicate live online Forex trading within a test environment where no trade actually gets sent to the market.