Paid for a Lesson Today

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com

I traded three times in the morning, one loss, one scratch and one win, so I was flat. Then I came back in the afternoon wanting to get a good trade in. It was getting close to 3:00, and I was really reaching. I proceeded to lose -2.3R taking scalps based on feel ‘em, which is the highly technical term for “gambling”. Next time I feel like I “need” some action, I’ll just hit the free online Texas Hold ‘em games. I don’t want to toss away the gains I’ve made so far. It’s tempting to say “Hey, I’m up a gajillion R’s, so why not toss a few down here and see what happens”. I need to have a stronger view of protecting my capital, like Richard does. I have the tendency to try to go for a big payoff on small odds, and that’s the door to the way I’ve taken 10% drawdowns in a single trade in the past. Trading should be boring, in a sense, since you should be executing your preconceived plan. If I want to “make something happen”, I’ll look elsewhere than the markets. This will help me keep my gains and cut unnecessary losses.

So this lesson cost me -2.3R’s, and the market will be happy to teach it to me again if I forget. For a reasonable fee, of course. 90 percent of trading is half mental, and knowing is half the battle, or something.

This post was contributed by a guest author, and does not necessarily reflect the views of Richard or MovetheMarkets.com