When I started trading, my results went a little something like this:
Does this ring true with you?
I’d take a trade, get all excited if I was in a winner, pee my pants, and close the trade.
I was a winner. A trading rockstar.
Then I’d take another trade.
+2%? Close that puppy now! Holy crap, I’m on a roll. I am the god of trading.
Then I’d have a loser.
What? A losing trade? Oh hell no. The god of trading doesn’t have losing trades.
So I let them ride.
This will come back, I’d think. It has to. I can’t take a loss. I’m a freaking trading god!
And down and down my trade would go.
-10%, -20%, -30%! And to top it all off, somewhere around -40% they’d gap lower!
Finally I would close my trade and let one catastrophic loss wipe out a bunch a small winning trades.
Is that you?
Why not turn that pattern around?
Why not take a bunch of small losers on the way to finding that big profitable trade?
Imagine if we flipped the 4 trades above. So they looked like this:
How does that look and feel? Imagine that last trade starts up, and instead of closing it, you use the same mentality that you used to previously hold losers?
The wait and see mentality.
In fact, take a look at your last big loser. Now flip it around. What if you were trading in the opposite direction. Making money everyday — instead of losing it?
Sounds like a plan to me!