Drawdowns are a bitch!
But it's part of the parcel of trading.
If you trust your system then it's just a matter of managing risk and executing.
The good times always come after a bad period.
Successful traders know they aren't going to win EVERY TRADE.
Most traders don't have the discipline or patience to:
Not trade
Wait for good opportunities.
Consistency is not perfect and it’s especially true in trading.
Newer traders come in thinking it’s going to be a simple straight line to success.
But it’s more of a zig, zag kind of road.
But professionals know this.
They expect this…
The difference is they don’t let the short-term noise affect their decision-making.
It can be an emotional rollercoaster if you aren’t fully prepared and know exactly what you are doing when you place a trade.
But when you have:
An objective rule-based strategy and have a plan for all scenarios
Put the time and effort into understanding your system's stats inside out like:
Win rate, expected drawdowns, and trade frequency.
Complete understanding how how 'probabilities' work
Then it’s just a matter of:
1) Showing up
2) Executing your edge
3) Managing risk
You know the results come regardless of any short-term randomness.
Unfortunately for newer traders when they don’t start with the right foundations.
They skip straight to YouTube, find a strategy and start trading without any testing or knowledge of how trading works.
They avoid the learning curve in hope of getting rich quick.
And end up get broke faster.
This then all creates bad habits
Which end up taking years to unlearn.
What ends up happening is...
- They lack confidence
- They are fearful of everything
- They can’t trust themselves
They go in gun ho and going of gut feel...
Jumping from strategy to strategy.
Avoiding putting in the work to test and verify
And investing in their education.
Forever be going around in circles until they blow up or quit.
So for those who I just described:
Start taking trading seriously and treat it with the respect it deserves.
Invest in your education and learn how trading works.
Put the work in behind the scenes testing and optimizing.
And finally take it slow.
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Cheers!
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"Every major correction begins as a minor reaction. You can't tell when a 10% decline is the beginning of a 50% decline until after the fact, when it's too late."
You're going to receive what you're asking for.
Just don't overthink how it will happen.
Relax, trust your process, and come into alignment with the market.
The truth is that you'll go through losses again and again and again.
This is the reality of trading.
The other truth is that this will hurt a little less each time.
Thinking is not an edge.
All the thinking was done when you tested the system.
When you go live everything is automatic,
You simply execute your plan flawlessly.
Don't think, respond.
Trading losses reflect an important reality of life ―good times will pass.
But since nothing is permanent, bad times will also pass.
Let that teach you wisdom.