What Makes Taking Losses Scary?
The absence of a sound trading model and impeccable Risk Management.
You fear losses, because you don't know your model, it's efficiency and yourself.
You will lose, given enough opportunities trying.
A sound model in the hands of a capable, sober-minded Trader, that employs impeccable Risk Management, prevents fear of losses; and replaces it with concern over KPI's.
The more you know...
95% of traders journal their P&L but completely hide their emotional state during the trade
which means their journal is totally useless
here is the hidden metric you actually need to track if you want to stop repeating the same mistakes every single Monday:
THE HEART RATE INDEX
if you enter a trade and your chest feels tight, your palms are sweating, and you can't leave your screen to wash your hands — your position size is too big. period.
you aren't trading the market anymore. you're trading your nervous system.
try tracking this for the next 20 trades:
Position Size
Confluence Score (1-5)
Anxiety Level (1-10)
what you'll find will shock you:
your highest anxiety trades almost always correlate with your biggest red days. not because the setups were bad, but because your panic made you micro-manage the candles and cut the trade at the exact worst moment.
if you can't walk away from the screen and let the trade play out mechanically, you're over-leveraged.
lower the size until the chart becomes boring again.
The secrets to effective & consistent profitability:
1) Adhere to a simple model.
2) Know what you want to make and it feeds you, leave something on just in case you were wrong about how much more.
3) Don't ask others for opinions, analysis or tips.
4) Manage Risk impeccably - ALWAYS.
5) Don't chase new things after you found your model.
6) Allow others to hold opinions - even if they are diametrically opposed to yours.
7) Unless you run a signal service, keep your opinions to yourself.
8) Make your bread, eat and go live for the day and find ways to bless others with it.
Anything else is BS.
34 years ago, from today...
I was working 6 days a week. My net pay, per week, was less than $300.00. I was single, recently divorced and no children.
I was sick of the rat race, being broke, tired of being tired of it all.
Then Trading walked back into the chat...
Perfectionism kills your potential.
Don’t worry about what others think.
Focus on trading your system.
Stay rooted in your process.
If it feels uncomfortable.
Good.
Just. Focus.
Focus up and get off social media.
The tough reality is that your need for social interaction is a huge distraction.
Trading is a solo sport, an independent game.
The more you can trust yourself & rely on your own conviction, the better off you'll be.
It is a Good morning...
Well, I occasionally go through the long list of people, firms, exchanges and the like, who follow my social media accounts.
I'm sometimes surprised to see that it is list of who's who. Many are the largest names I once looked at when I was not a household name in the industry.
I see many of them discussing the recent increased volatility in the markets. You have been primed well in advance of this and it should bring you satisfaction that you were not victimized by sudden events in market pricing, as we talked about it long before it materialized in the markets.
This volatility is going to increase. It may impact us as Traders to a degree that it forces us to remove our equity by our choice... to preserve capital. This is wise, this is prudent, it is not weakness or fear.
I am reading so many inexperienced or blatant gamblers belly-aching over margins being increased. Or prop firms lowering exposure or contract maximums on customers.
If you are angry over this, you are a fool. If you feel cheated, you are trying to gamble. If you complain about it - you literally are telling the world that you have no risk management, you are out of touch with Global Risk, Gap Risk and deserve to experience financial Darwinism.
Don't be foolish and treat speculation and trading like online poker, only to discover your actions lead to an extinction level event for your finances.
Slow down, size down.
It is time to put on your Risk Management cap and conduct yourself as the world's most patient Risk Manager in the world.
If you disagree, unfollow me... please.
You put way too much energy into your trading… let me explain.
You’re chasing setups.
Chasing indicators.
Chasing signals.
But ignoring the only thing that actually moves your P&L:
Your sleep.
Your focus.
Your emotions.
Your discipline.
Trading isn’t an IQ game.
It’s an energy management game.
Tired brain = bad decisions.
Bad decisions = blown accounts.
Protect your energy like capital.
There is No Plan B.
The moment you create a sense of urgency for yourself, you will find a way.
Your mind is your most powerful ally and is capable of more than you could ever imagine.
You just need to give it a clear goal to work towards. A vision.
Write down what you want to achieve, how you will make it happen and begin putting in the work.
Day In, Day Out.
Week In, Week Out.
Fall in love with the process and the results will come.