I had to write this article because I know from personal experience how hard it can be mentally for new and experienced traders to let go of a trade that they closed too early that went for much bigger gains immediately after.
I had to write this article because I know from personal experience how hard it can be mentally for new and experienced traders to let go of a trade that they closed too early that went for much bigger gains immediately after. Before I continue this valuable lesson, I want you to look at the figure below that shows one of my successful trades today. If you are a subscriber to my forex signals, you will recognize this was the buy signal for the EUR/AUD pair today:
This 46 pip win for me was a very good trade, and it fit my trading style well. I wasn’t looking for a 400 pip gain, therefore I was confident when I exited the trade. Many traders would have been mad that they exited this trade so early. I have no regrets for locking in my profit, because it met the goal that I set. If my trading style were to look for 400 pip gains, then I would have been disapointed because I altered my trading plan.
There is no way that you can predict the future as to where the market will go. Great traders don’t predict the market; they study the market with every piece of information that is available to them, and then they trade based on this analysis. My analysis told me and my readers to grab 25 pips and not get greedy with this trade. If I were able to make 46 pips everyday, I would be filthy rich within a couple of years. New traders simply do not get the fact that you don’t have to double your account every month to be a successful trader. I have seen traders double their accounts in a short amount of time. I would say that 60 percent of these people got lucky and arrived at this stage because of lucky trades. I would much rather stay with my plan and have good solid trades, because this is how you learn. You don’t learn by guessing or using a recommendation from someone else. Don’t get me started about how awful all of these automatic forex trading systems are that show champagne and Ferraris on their website.
The real take home message here is to stop looking back through hindsight at what your trades could have become and start looking toward changing your style if you are consistently getting out of trades at the wrong time. I have already evaluated my system and exit strategy, therefore I have no shame in my 46 pip win.
My forex signals are for you to enjoy how you please. I hope that all of my readers use my signals and then learn how to trade my way. I completely welcome all of you to leave comments or directly email me with questions about my trading style. Teaching you makes me a better trader.
Stay tuned for my next article entited Why Traders Should Set Goals for Quality Trades, Not a Dollar Amount. If you haven’t already, sign up for my RSS feed, or learn to trade my way by signing up to receive my trade free via email. Cheers, have a great day.