Copyright © 2016
Copyright © 2016
As many things in life, trading is not different: if you are consistent about doing something, you will have your reward in the end. Of course, this is not related in doing wrong things all the time (although it will also “rewards” you somehow). Let us say after you have decided to be a trader, you may be luck and have a great first profitable month. Ok, for sure it has a chance of you just being lucky. However, let us assume you were not and were helped by your skills as future trader. As things in life are not linear, in the following month you not had the chance to trade as you did before. What happened? Probably a non-profitable month. Then yours self-steam as trader starts going down and you are done: your emotions will take control of you.
However, in fact, what happened?
Having as premise that you have a profitable trading system, there is one thing you should care about that is the fact that your trading system for sure is not 100% accurate (as none trading system is in this planet). It will be right and wrong according to the market fluctuation. That is why you went in loss for the second month. As we do not know when your trading system will fail, you must do your trades consistently in order to be exposed in the market as much close as possible to all “right” and “wrong” entries. Then you, on average, will be right according to yours trading system average – which means profits. If you trade occasionally, you are setting the odds against you – unless your method tells you to trade occasionally.
Besides this mathematical effect of consistency, we have another point: we humans are very good classification machines. We learn with time from observations. Therefore, if you are trading frequently naturally on every new trade you will become a better trader than before. This is how life works – it is not me saying it, just observe from your experiences. Ok, it is very hard to accept this somethings – but this is what shows that you have emotional intelligence to be finally a trader. You must accept that things does not happened exactly in the time you want them to happen, so be patient (another great skill you develop from being a trader).
Right now, when I am writhing these words, I am in a position that is against me. It is not easy to be comfortable with it but I did my entry based on my trading system. There is nothing to be afraid once I know why I did the entry and when I must leave. As it is an entry based on a high probability trading – and I am doing this for quite a long time – I have the odds in my favor. In case the odds turns against me, a suitable stop loss will take place and tomorrow, I will have another chance.