The Road to Riches: Giving Up

How can you minimize your losses?


Give up.


The reason most traders “blow up” their accounts is by letting their losses get out of control. You have been trained and conditioned your whole life to think positively and never to give up or back down. That sort of thinking will reek havoc on an equity curve.


The trick is to enter every trade with the mindset that you are wrong. Being able to admit defeat is probably the most admirable trait a trader can have.

...'The trick is to enter every trade with the mindset that you are wrong'.

Wrong.

The trick is to be and to stay flat-lined during the entire duration of your participation in the markets.

Feelings, thoughts or emotions of being wrong or right, strong or weak, clever or stupid do not and should not find any place in your head nor heart while you are part of the market.

My best.

LoL! Very interesting subject, we've all gone through though trading moments but my advice to new traders is to not give up if i would have given up i certainly wouldn't be where i am today ($$!). I've layed out 10 principles that new traders must be reminded of:

1- You must take your currency trading career very seriously. Keep up with the fundamentals in order to match them with your technical studies or projections. For instance, last week Gov. King admitted that the U.K was in a recession and on friday, the GDP cam out negative... I was personally str8bearish! And i took in most of the profits of the GBP dowmward movements.

2-The longer, the truer. Which means, a head -n shoulder pattern is more significant when it appears in higher time frame (H4, D...) than lower timeframe (1 min..).

3- Carefully manage your leverage. Lots of traders blow their account by putting too much money on the table.

4- Greed is the enemy. Do not waste more than 6% of your account in one trade. Why? Because it will be easier to make those 6 % percent back (in 1, 2 or 3 trades) than all the money that you could potentially lose.

5- Patience has helped me so i most certain that it could also help you.

6- Greed is the enemy 2. Dont chase every single trades it is not worth becoming condfused (lol!). THERE IS ALWAYS opportunity to mke money.

7- Let me make this clear: TREND IS YOUR FRIEND! Do not trader against the trend.

8- Learn how to spot support and resistance. Use fibonacci if needed it'll help u a great deal.

9- "Feelings, thoughts or emotions of being wrong or right, strong or weak, clever or stupid do not and should not find any place in your head nor heart while you are part of the market" by Trade 613. CONTROL YOUR EMOTIONS AND NO REVENGE TRADING! As Jim Cramer says: "Nobody ever made a dime by panicking"

10-Never give up trading!

you guys got me a little wrong. and i apologize for maybe phrasing my message a little weird..

a lot of times traders will follow this thought process as the market moves against them

market moves against the position

I can't believe this, my method has been doing so well lately, ill just hold it until it breaks support.

after the market breaks support

Ok, it broke through support, I'll just liquidate on the next rally

market rallies

Wow, that was a pretty substantial move, Ill just wait it out I think the trade might work out after all.

market begins to decline again

Ugh, I could have gotten out at break even, now I'm down again, Ill just get out if it breaks that last trough.

market continues to fall, and as you hesitate the market keeps falling and it becomes harder and harder to accept the loss..


I by no means encourage anyone to quit trading if they are having difficulty. It takes time and commitment to become a successful trader and giving up will get you no where...

HOWEVER, give up on your losing trades. Know the risks you are taking before you pull the trigger and respect your decision once you are in the trade.

the secret is to "become one" with price

don't try to own it

don't try to fight against it

just flow with it

Laff... "the secret is" ... there is no secret. Spend time studying, spend time w/ the charts, figure out something that works for you. Or not... up to you really.

An attorney spends 2 years and countless hours before he/she can practice law in addition to a pre-law degree. A doctor spends even more, countless hours and dollars learning to practice medicine just to make $100k a year (if lucky), all while dodging liability problems. A good engineer goes on to a master's degree, or higher. Just to teach something as mundane as basic chemistry you often need a doctorate... and that's for substantially less pay. Why you'd think you could just crack open a program and learn the magic of trading within a few months, I'll never know. But ppl do think that, most aren't willing to do the work it really takes to be sucessful in any given field.

Greatest thing about being your own boss is that you are your own boss. Worst thing about being your own boss... you're your own boss.

love the analogy!

learn from your losses, consider it tuition for trading school

The biggest mistake new traders make it thinking that trading is easy. It is an exiting thing when you first become acquainted with trading. The potential reward drugs your brain for a long time. You think the money is going to pour in faster than you can count it. So you open an account and open a standard lot at the sight of a MA cross. You have no clue what you are doing, but you set what you believe to be a safe stop (50 pips we'll say) You are trading the pound yen, because you heard its quick money. After several trades hit your stop, your account is depleted, you are worried now. So naturally, you assume that one of these MA crossovers will work and so you open 3 standard lot sizes because it's time to get your money back. In less than an hour your position is closed because of in- sufficient margin. You are feeling numb now, you are angry, you will soon be blaming. If you don't quit at this point, you will have to go through this exact same thing at least one more time if not a few more times. Blowing a couple accounts is the initiation, tuition for becoming a trader; your hazing by your future fellow traders if you will. What these inevitable losses do is wake you up. They provide the motivation needed to get you learning. When the easy money deception wears off, you can start the long hard road to using your brain in trading. It is a long hard road, but it is true that if you tough it out, work hard, and never give up, you can be a successful trader. Don't ever assume someone is going to give you the perfect system, never become dependent on anyone for your success. It is in your hands alone.

Study fibs guys...Study fibs...


Scotty B

Just make sure loosing doens't become a long term habbit. We must break through this cycle!