Welcome to NexusFi: the best trading community on the planet, with over 150,000 members Sign Up Now for Free
Genuine reviews from real traders, not fake reviews from stealth vendors
Quality education from leading professional traders
We are a friendly, helpful, and positive community
We do not tolerate rude behavior, trolling, or vendors advertising in posts
We are here to help, just let us know what you need
You'll need to register in order to view the content of the threads and start contributing to our community. It's free for basic access, or support us by becoming an Elite Member -- see if you qualify for a discount below.
-- Big Mike, Site Administrator
(If you already have an account, login at the top of the page)
Treat it as a long-term trade, and trade around it for the short-term. For example, if you are long-term bearish, then stick with it, but have a level where your long-term thesis is wrong and you should get out. Meanwhile, trade something else that tracks the DAX, like DAX options, or CFDs, but on a shorter-term time frame. In this, you are trading around your longer-term position, and could be long or short without exiting your longer-term position. But you would still need some level or decision point where you should get out of your longer-term thesis, which you have been forced to have because you want to stay short.
BTW, this is a topic, among others, that I will be talking about at my Meetup (over Zoom) at 7pm Pacific/10pm Eastern tonight, titled "Hedging Strategies"
And I will have to add here, traders should learn from pilots who do not let the plane hurtle down the runway without first having gone through their extensive checklist beforehand. Same as surgeons, anaesthesiologists and any other professionals. Have a detailed extensive checklist on hand before placing the trade and make sure that all the points on the checklist are adhered to.
You will find pros and cons for any opinion. You do not have a plan, so there is only one option: get out asap.
Then with a clear mind you can enter the next trade - with planned exits for any possible outcome. Good luck!
If I was in your shoes, I'd cut my losses as my trade is now invalidated. Expensive lesson to learn (we've all had them), but I guarantee you, you'll mark your SL correctly in future!
Given you haven't been margin called, you still have funds in the account, meaning you live to trade another day. Take that positive and move on.
I have had a similar situation where my S/L was inadvertently set to DAY rather then GTC. I didn't even realized I still had the position as I thought I had been stopped out. I decided to held on and things got progressively worst. I finally bailed out and took the loss and never looked back, lesson learned. This was during my first month trading futures : ). If the same thing happened to me today I might have handled it differently, since I have 2 accounts with 2 different brokers I might take an opposite position and hedge or "stabilize" the damages to buy myself a little time and see if I can bring it back to a smaller loss or a break even point.
It's a very personal decision, but usually the consensus within the trading community is to bail, that's what I was taught and what I should have done the minute I discover the rogue position. Good luck.
You got yourself in a pretty big mess.
Fortunately, the DAX is going down but on a daily basis he's testing a support line today.
So if I were in your position, I would exit the short position today and if the support line
breaks enter a new short position right away.
I'm sorry you are in a corner with this trade. I know how that feels. This is a crucial event for your trading development.
I'm going to try to help you in the most direct way possible. This is based on a lot of experience with some seriously terrible trades that I have taken and by watching my own traders and many others do the same.
There is a simple solution to this problem: Exit the freaking trade. Not only did you already lose 2200 points because your account is marked to market every night, but you have missed so much in the other direction and continue to do so. Without closing the trade, your anxiety/stress response will prevent you from really being able to read the market.
Continuing to hold this does 3 key damages:
You are in a trade that is way outside of your plan. So even if it comes back, YOU WILL DO THIS AGAIN at some other time because you got rewarded.
You have missed an unknown number of trades while you were tangled up in this one. There is an indeterminate cost there
You improve as a trader (or as anyone) by repetition, so the cost of this trade has excluded you from many others that would have brought you closer to being a better traders
You are clearly focused on your P&L. I don't care if your stop loss was wrong or whatever. The fact is you held on and that is the truth behind it.
Now here's the catch: You get out of it and it drops 3000 points and now you feel the pain of locking in a loss when you should have held. The correct prospective: You closed it. You did the right thing. You can get closer to trusting your actions as a trader (which is imperative to growing and to trading size). Do you see the market setting up for another short? Great, set up your risk/reward and take the short again....no big deal.
Finally, you seem misguided in what your job really is. Your job is not to take winners every time. Not to commit to a trade that you are sure will win. Your job is to take as many trades that reveal your potential edge as possible with fixed loss limits. That requires trust in yourself and discipline. Both of which you have damaged by hanging on. The good news is that you can build from here.
This is my opinion.
Risk Disclaimer: Trading Futures is not suitable for all investors. Past Performance is not indicative of future results.
If you have any questions about the products or services provided, please send me a Private Message or use the futures.io " Ask Me Anything" thread
