Hey guys Iâve been Trading for about 5 months now and have a pretty descent strategy down already but am having a huge problem that Iâm having issues overcoming. I come in work every day and am able to make good money ($200-500) then I always loose it all. I donât take more risk and I donât change the way I trade at all but I really donât know what to do. This is getting so bad that Iâm starting to question my career as a trader. Any words of wisdom would be greatly appreciated.
Go home after you make the easy money. Try it, you might like making $4k-$10k/month. Hmmm...$48k - $120k/year. What do you make now? I wonder if any of you beginners have actually taken my advice when it comes to this topic. I think there's been at least 2 or 3 posts like this in the last 2 months. Just try it! You might like it. When you start making money, then worry about optimizing your trading career.
I think the answer is obvious. After you make your $200-$500...quit for the day. There is no law that says a trader has to trade all day. The market behaves differently during each part of the day....the opening is usually a lot more volatile....the middle is usually much slower...and the end of the day is kinda like the beginning but with more obvious support/resistance levels set during the day. Figure out what kind of trader you are and what part of the day fits the best with your style of trade. A lot of traders...myself included...only trade certain parts of the day. If you're only making money during the morning...then it only makes sense to only trade that part of the day and then quit. good luck.
The psychological root of your problem is similar to that of many gamblers. When they have winnings, they tend to view those winnings as playing with "house money". When you make your living trading or gambling, one cannot afford such a view. This money is not to be viewed as winnings but earnings. <p>Using an athletic analogy, it is easier to get to the top, than it is to stay on top. <p> I spend a good deal of energy in my trading day making money or gaining ground, but there are some days it seems that I may spend more energy defending the ground that I have already gained. Defending your profits may not be the fun part of trading but it is very necessary in order to be consistently profitable. <p> A difficult lesson to learn is to consistently make the same trades. What I mean is, that a good trade is a good trade in its own right, no matter if you are up for the day, down for the day, or merely treading water.
These all are some really good points and I thank you all very much for it. I am going to try cuting off my trades more but the problem I have now is how much is enough. One of my problems is that I always increaseing my goals. when i reach $300 i want to try for $500 when i get there i want to get to $1000. And if i choose a point to stop how will i ever grow and make more. and thanks you all once agian what you were talking about defending profits and with the house winnings really hit home.
Since you're a beginning trader...keep your goals small. Your first goal should be just to consistently make good trades....not a specific dollar amount. If you make good trades the money will follow. As your account grows...you should be able to trade bigger yet keep your trades the same percentage of your account size....and your profits should increase. If you don't make your monetary goal on any single day...don't obsess over it. That is the downfall of most traders...trying to force trades to make a certain amount instead of waiting for the the trades to come naturally. Patience is the key. good luck.
<cite>These all are some really good points and I thank you all very much for it. I am going to try cuting off my trades more but the problem I have now is how much is enough. One of my problems is that I always increaseing my goals. when i reach $300 i want to try for $500 when i get there i want to get to $1000. And if i choose a point to stop how will i ever grow and make more.</cite><p>What you are expressing is called chasing. Chasing is an emotional exercise which allows the market to have its way with you. Setting goals and increasing goals are good things. But this should not be done on the fly and in the heat of battle so to speak. Consistently meeting expectations day after day is better, than the emotional roller coaster that brought you to starting this thread.
Great thread. I was about to start one that was very similar to this. My question was, how many of you stop trading when u reach your goal for the day? Also do u have a downside limit for the day? A problem I had when i began trading 4 years ago was that i was having 4-5 hundred dollar days from the beginning, but i was never satisfied. I always wanted more. And I always ended up giving back the money I was up and eventually ended up in a huge hole. This set up some nice psychological patterns that i am still dealing with today. Looking back, If i had a firm goal and respected it I would have been making some nice money from the start and would have saved myself from some traumatic experiences. At the time I just did not have the experience to protect my day without giving it back. I always traded great off the open and kind off struggled for the rest of the day. Over the years I learned to leave after after reaching a certain point and during those periods have always had great months but I still wonder (the same voice that made me wonder if i should stay 4 years ago) should i be leaving. Well for the majority of the time when i stay, I end up losing money or churning, but there have been several periods where I would stay and had 20k+ months. I guess my point is, i was just curious to see how many of you stop when your up a certain amount of money regardless of whats going on???