You are looking at it in hindsight man. What if it kept going down and wiped you out?
Exactly. That's why I bit the bullet and sold.
But I bet you the big long term players like Ray Dalio, the founder of the world's largest hedge fund with over $100B in assets and who has been promoting gold for months now, did NOT sell. He probably added in. That's the advantage of size.
So small retail traders like us have to be super precise in our timing.
From my historical stats, I think my chart reading is about 70% correct. Very high rate. but my profits are not much is because I get shaken out a lot of time.
Just now, I bought GC at the lows as 1518.80 and I was thinking it will probably go to 1522. Which is a decent short term trade in the next few minutes. It went to 1520 then went back to 1519 I got out because I want to protect my profits before it goes back to my entry. Of course, after that it went past to 1525.
In mathematics and physics, it's called "path dependency". That's what makes trading hard especially if you are trading leverage instruments like futures.
Even if your directional target is correct, you can still lose money because it depends on the path in which the instrument moves. To your point, let's say in one day it goes down 100 pts then the next day it goes back up 150 pts. Extreme example.
Of course, one can say one is right because the trend is up and it went back up the next day. But with futures being down a 100 pts will wipe out most players.
It doesn't have to be as extreme as a 100pts but yesterday's high to low was 58 pts!
That's why they tell you to trade much smaller. haha.
