The promise of nearly unlimited freedom of being a trader, both in the way you work and your overall lifestyle attracts people of poor discipline to trading.
Discipline is the ability to obey your own rules by sacrificing short term temptations in favor of long term goals.
If your technique and market knowledge is poor, you should still be a break-even trader. A losing trader usually has discipline problems or is engaged in self-destructive behavior such as chronic counter-trend trading, random entries, chasing unexpected moves, reversing and re-entering on every loss and so on.
If you have a modicum of discipline, you should be able to limit your losses and turn the corner using the two strikes principle.
If you are unable to stick to even that, I suggest you try the single trade rule. Any day, you will take exactly one trade, win or lose. The purpose of this system is to slow you down and remove the urgency and unrest when sitting out and reactive behavior on loss (or even wins) that causes so much destruction.
A few months of the single trade system should make you more cautious and more tolerant emotionally to loss. More importantly, this should protect your account from rapid evaporation.
No comments:
Post a Comment