Excellent post! Go and read this post very carefully, Flashboy! Then print it out and internalize it. Hang up a copy on your office wall, toilet wall, bedroom wall. Don't ever forget those rules. These are the rules all traders must follow. Learn them inside out! Every trade must be fully accounted for before it happens. You already know the probability of success and failure, Reward:Risk ratio, half-and full stops for exit, profit targets relative to the range you're expecting the trade to move (what's the expected range of your issue? Do you know how much profit you're gonna make on the trade? If not, you might as well not put it on!), calculate your target and, for example, take 1/2 the profits halfway. This works amazingly well in retracement trading, for example. In order to do this, you always have to know all your support and resistance levels, of course. Be all-informed. Assume that everybody out there is smarter than you, desperate to rob you, and your only mission is to protect your capital! Basically, you have to have everything tested a thousand times before you enter the trade! You have to <i>have won the game already before you even start.</i> Another good point in this thread was to use a daily disaster stop to keep you from trading - Dead on! Say you have a stop of $5,000 a day or whatever it is (shouldn't be more than 3%, I'd say better is 1.5%-2%!), after which you will take no further trade, no matter what happens. This way you will discipline yourself, and use the rest of the day to study and think about your mistakes, rather than immersing yourself in vengeance trading etc. Remember: You can't lose any money when you're not trading. Cash is a position, too. Knowing when to stand aside is the virtue of a truly magnificent and accomplished trader, and something we should all strive for. Pick the good trades and forget the rest. Seriously! It's not worth it! Remember this quote? <i>"Men who can sit tight are uncommon. I found that it is one of the hardest things to learn. But it is only after a stock operator has firmly grasped this, that he can make big money." -Edwin Lefevre, Reminescences of a Stock Operator</i> Let me just add another quote, from <i>Market Wizards:</i> <i>Top Traders believe: -Money is not important. -It is OK to lose in the markets -Trading is a game. -Mental rehearsal is important for success. -They've won the game before they start.</i> I hope this helps you a bit. Good Luck to you, Flashboy! ~The Scientist
disagree, you need to follow your method yes, you need to have patience, and not compound your losses by trying to win them back
Not to sound condescending (spelling?).. I do accept losses.. but if my system were to give back 80% of profits I would be looking for a different system.. my problems were psychological.. too much risk and taking trades outside of my plan...
I always place a stop loss right after I am filled.. with this trade.. as I was clicking the sell button the market starting taking off.. Like I said.. I put in a limit order to sell at 75..and got filled at 84.. because the market took off.. and within 30 seconds I was down the 30 points...
Well I did it again too. Started the morning off with a nice textbook trade then gave half of it back on a "hunch" trade. I have to fight this impulse to play hunches all the time. Im getting much better at it but find it hard to believe that im doing it at all after this much time. Bad habits die hard.
ever think... Hmmmm, maybe I shouldn't be so "greedy", which is what I think is a large part of the problemo... when you're doing great... step aside, wait for the perfect "wave". No rush....... NO impatience. Like Poker.... why chase or bluff on nothing, just because you got a lot of chips right now G'luck bro! Ice
I can relate to your dilemma. I too go through the same cycle you do. Here is an analogy: Person wants to lose weight. Person knows how to lose weight. Person starts to lose weight. Psychological change takes place, person goes on eating binge, gains weight back. Person thoroughly disgusted and disappointed in self. At some level, person fulfills an inner need. Repeat cycle....