Admit it, pulling out of a trade prematurely syndrome happens, or used to happen, to all of us. So how do you tackle the issue of your lizard brain (the one that is mostly instinct driven & non-logical) interfering with the plan? I try to just walk away, set the stop & target, turn screen off & await bad or good news.
Why the F did I close out the trade?!
- Thread starter Master Pu
- Start date
You have no plan for the exit, so you trade your P/L
Not diversified enough, too many eggs in one basket.
Here's the thing. If you're referring to the NQ trade you closed out and which almost went back to your entry point last week - you would have felt frustration if it stopped you out breakeven, too.
Why the f''k didn't I take profit when I had the chance?
Just be glad you got a handsome profit and move on to the next trade. As you gain more experience you should probably get better answers.
As for micro-managing, I'm reminded of Darvas who failed miserably when he became a full time trader close to the NYSE and had to quit that gig and get back to what he was initially doing, i.e., not micro-managing and not following the market too closely.
Why the f''k didn't I take profit when I had the chance?
Just be glad you got a handsome profit and move on to the next trade. As you gain more experience you should probably get better answers.
As for micro-managing, I'm reminded of Darvas who failed miserably when he became a full time trader close to the NYSE and had to quit that gig and get back to what he was initially doing, i.e., not micro-managing and not following the market too closely.
your trade plan needs fine tuning.
Your trade plan should factor in
- market that will stop you out
- market that will move just a little
- market that will move tremendously
remember I asked you to take some profit?
You said
you wouldn't AVERAGE IN, AVERAGE OUT or whatever;
it is all or none ...
let's say you trade with 3 lots.
1st lot - target decent profit.
last lot - hold on for many hours/days.
2nd lot - TP somewhere in between.
One big reason you end up getting out of a trade is the fear that profits will vanish and turn it to a losing trade. When a stock is in say an uptrend or downtrend as the case maybe, any reaction against the main trend will cause you to lose a good chunk or maybe, even all your profits. That is the reality of it. I know it has happened to me multiple times. On the flip side, a strongly trending stock, will most likely continue its trend after the pullback or consolidation. So, just stay in. If your stop loss gets hit, of course, you will be forced out of your position and probably, save you monies. When you allow your trades to run, chances are good that when it does, you will have more profits. One big incentive to hang on. My view is each trade is the same as the next trade assuming I used the same criteria on each stock I pick. Think like a casino and let the percentages work for you. In the long run, you should do quite nicely.