Finally, I got wiped out today after several days struggle
I read this note from one forex forum with sorrows. This student just picked up a forex trading class. He said in the forum that he could not control himself. He could not remove any emotion. He could not follow all the strategies and rules. He knew the danger but yet he continued to do it. He told himself he needed to stop not following the rules but he could not do it.
He shared in the forum about what happened a few nights ago. All the indicators were showing the strong uptrend. Yet, he was going for short position. When his trade was stopped, he went to short position again when there was signs of retracement. Worst still, he placed an order without profit target and stop loss. He admitted that he is gambling. So, in the end, his account was wiped out within merely 2 days.
He is in depression mode. He is remorseful and embarassed. An now he is asking others for help, in particular how to control his emotion.
As far as I am conerned, this is a classic example of why an aspiring trader can easily fail after paying for a seminar. A retail trader has a high tendency to approach trading in the wrong way. He trades without a plan. He trades with emotion, greed and fear. A seminar in itself is not in the position to put a newbie in the position of a professional trader. Instead, the newbie has to take control and makes a decision to follow the rules, and trade with a plan. If he fails, he cannot blame the seminar, the course provider, and the instructor. From this newbie's note, he did not blame anyone. So, it is indeed a good sign. He knows his weakness. He just does not know how to do it. In my mind, there is still hope on this newbie. He had a painful lesson and he will learn from his mistakes.
So, how can we help him? Actually, no one except him can help himself. Why? It is because like I said above, he has to take charge of the outcome. Maybe he should stop trading for a while. Maybe he should start again by paper trading in a demo account. Prove to himself that he can make consistent money before funding a new account. It's very obvious that instructors keep telling newbies not to put real money to trade but practise in demo account first. Not many people I know will follow the rules. In my case, I never trade a system unless I have backtested it and paper trade for a while. Only when I see consistent returns I will put my first $ at risk.. Some people call me nuts and some people disagree with me. Honestly, I don't give a damn. Why? At the end of the day, I am accountable to myself, not to the others. So, why am I concerned with what other people said?
I wish this newbie a successful trading career. Don't give up and take massive action to deal with the psychology part. Like what Conrad and I said to our respective students, it is trading psychology that brings success to a professional trader.
I read this note from one forex forum with sorrows. This student just picked up a forex trading class. He said in the forum that he could not control himself. He could not remove any emotion. He could not follow all the strategies and rules. He knew the danger but yet he continued to do it. He told himself he needed to stop not following the rules but he could not do it.
He shared in the forum about what happened a few nights ago. All the indicators were showing the strong uptrend. Yet, he was going for short position. When his trade was stopped, he went to short position again when there was signs of retracement. Worst still, he placed an order without profit target and stop loss. He admitted that he is gambling. So, in the end, his account was wiped out within merely 2 days.
He is in depression mode. He is remorseful and embarassed. An now he is asking others for help, in particular how to control his emotion.
As far as I am conerned, this is a classic example of why an aspiring trader can easily fail after paying for a seminar. A retail trader has a high tendency to approach trading in the wrong way. He trades without a plan. He trades with emotion, greed and fear. A seminar in itself is not in the position to put a newbie in the position of a professional trader. Instead, the newbie has to take control and makes a decision to follow the rules, and trade with a plan. If he fails, he cannot blame the seminar, the course provider, and the instructor. From this newbie's note, he did not blame anyone. So, it is indeed a good sign. He knows his weakness. He just does not know how to do it. In my mind, there is still hope on this newbie. He had a painful lesson and he will learn from his mistakes.
So, how can we help him? Actually, no one except him can help himself. Why? It is because like I said above, he has to take charge of the outcome. Maybe he should stop trading for a while. Maybe he should start again by paper trading in a demo account. Prove to himself that he can make consistent money before funding a new account. It's very obvious that instructors keep telling newbies not to put real money to trade but practise in demo account first. Not many people I know will follow the rules. In my case, I never trade a system unless I have backtested it and paper trade for a while. Only when I see consistent returns I will put my first $ at risk.. Some people call me nuts and some people disagree with me. Honestly, I don't give a damn. Why? At the end of the day, I am accountable to myself, not to the others. So, why am I concerned with what other people said?
I wish this newbie a successful trading career. Don't give up and take massive action to deal with the psychology part. Like what Conrad and I said to our respective students, it is trading psychology that brings success to a professional trader.
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2 comments:
hi, greeksman,
may i know how to improve trading psychology? Any book that can refer to on this issue?
And can i suggest you use a bigger font size for post, so that more easy to read. Just like your post on topic "im not defence optionetic....." the font size is comfortable for reading.
your faithful reader
Kia Huey =)
There are many books on this topic. Go for "Trading for a Living" by Dr. Alexander Elder, and "Coming to My Trading Room" by Dr. Alexander Elder too.
Another "must-read" book on this topic is "Trading in the Zone" by Mark Douglas.
You can use "zoom in" in your browser to enlarge the font. I think the current font size is pretty ok for me, and I am very comfortable with the current font size.
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