Continuing my fight against the novice belief that “everything must always turn out perfect!”…
So we got one good outcome followed by one #$@%^ outcome.
LOL.
Laugh at yourself.
Forgive yourself.
FOCUS.
Move on.
There are more trades coming and they require your full attention.
Plus… in the big scheme of things any one individual trade is IRRELEVANT.
Human decision making is flawed.
Trade entry decisions will at times be outstanding. But at other times, looking at the charts with the benefit of hindsight, we’ll wonder what on Earth we were thinking!
Trade management decisions will at times be perfect, leading to a far greater outcome than you would typically expect to get for that sequence of price action. And at other times, such as in the second trade sequence above, our trade management decisions will lead to significant underperformance when reviewed with hindsight.
Sometimes we underperform. Sometimes we outperform.
Ultimately though, individual trade results do not matter.
We don’t profit from any one trade. We profit from management of risk and opportunity over a SERIES OF TRADES.
I’m sure you’ve seen the following formula which defines your success or failure as a trader:
Expectancy = (Win% x Average Win) – (Loss % x Average Loss)
Here’s the important point:
Successful trading INCLUDES #$@%^ outcome trades!
By all means work to reduce their frequency and their negative impact upon your equity balance.
But you HAVE TO accept that they’re part of the game.
Provided you’ve kept risk contained within your pre-accepted risk parameters, then DON’T BEAT YOURSELF UP.
Laugh at yourself.
Forgive yourself.
FOCUS.
Move on.
Lance Beggs