How do you when to stop trading for the day (or your units of a break)?
How do you when to stop trading?
I know this isn't a manual and there is no one answer, but I use the following guidelines for myself:
The relationship between the size of the trade and one’s rationality is only linear to a point. If you feel you've passed that point a long time ago, S T O P.
If you are only watching the PnL display and ignoring the market context, or if you are focused on candles instead of the picture and find it impossible to step back and clear your head (i.e. impossible to stop watching) S T O P
If you feel you are in a kind of hypnosis, trance or muddle S T O P
If you feel there is too much on the line, your life is wasted if this trade doesn't work out S T O P.
I have stops but I move them. Yet the stops get hit. The market is relaying critical information to you. You are the victim here. Victims don't trade, only traders do. S T O P.
If you catch yourself adding more funds to your account during the session, S T O P.
If you come to the battle with battle lines drawn but later change to using wider stops, S T O P.
If you feel hopelessly pinned, see that the trend is against you all day and yet are fighting back S T O P. I know it will be hard at this point, but it will be even harder later on.
If you have you battle lines drawn and yet you look for more or think 'let it run' S T O P.
If you are thinking about mean reversion after a big move and are thinking about entering without a setup because the next move is so damn obvious S T O P.
I cannot stress the importance of S T O P.
Note: By STOP I mean only one thing: get flat, walk away.
But you say: I can’t leave the charts! Something might happen. Anything. I must be here.
If you have figured out the market, you think this trade is so simple to execute that it doesn't add up that anybody could actually be on the other side of the trade... no don't stop but change into Other-Side-Shoes and Think-from-The-Other-Side.
Think of all the losing days you've had and where your account would be if they were much much smaller. I have actually sat and analysed this. S T O P is also a trade. You trade in your ego for the profit of unbending commitment and for staying in this for the long haul.
I'd be flattered if you click the link below and hit the thanks button on the post TODAY :-) :
No combine trading after real loss! (but real trading, yes)
I haven't traded my combine account for many days.
That is, after I experienced a huge loss in ES a few weeks back.
At this point I am feeling rather bland - I keep gathering stuff, analyzing, posting thoughts..... but am not trying to trade the combine (and the twist is that I still am trading real money... I recognize this as the need to make back the same in the same currency that I lost.. i.e. real money and not combine dollars.)
This 'wanting to be made whole again' is just a viewpoint, a postion, a point of view. Up and down have no meaning for a reasonable trading plan. How can I get back in touch with reality instead of going on being a paper combine-trader?
The fear here is screwing up parameters of the combine. Real account is steadily going up, in small increments compared to the big loss.
I really hope you continue this journal beyond October, I mean I know you might be discouraged from just falling short at the last hurdle in the popularity contest, but you should be proud that you worked hard and helped a lot of people... Success will come.
The following 2 users say Thank You to TurismoTek for this post:
Thank you, and yes, the journal will continue as it always has done.
As I've already reiterated, the education is in the participation more than in the winning.
As I also said:
I have taken it within my stride like a trade which almost reaches your target, comes short by one tick and reverses, only to hit your full stop later on. Handling the feeling of "not winning" is at the very crux of being a successful trader - the very core of the holy grail, wherein no loss or no lost opportunity causes feelings strong enough to destabilize the correct mindset needed for consistent trading.