As you learn to trade, you must remember that we are trying to
make as much money as possible, while losing as little as possible. We
accept that there will be losses, but we seek to minimise these losses.
Every time we take a poor trade, through frustration, or anger, or
trying to force the market, we take a step backwards - we lose. Every
step back we take, moves us further away from our target. This means
that sometimes we need to learn to pass on trades, to realise that
'being a pilot on the ground, wishing he was in the air' is far better
than 'a pilot in the air, wishing he was on the ground'.
Walking away from a trading opportunity is a very difficult thing to do, but sometimes it is necessary to keep capital and live to fight another day. Remember that the market is open 24 hours a day 5.5 days a week. The markets have been around for longer than any of us have lived, and they will likely continue long after we die. Therefore we need to recognise that there will always be another opportunity. There will always be another trade. We should focus on high probability opportunities, and nothing else.
Think of it this way...
Let's you have a $10,000 account, and you are risking 1% per trade. You are looking to make 1% return per winning trade. If you have 7 losers, and 8 winners, are you at +1%? Yes, No, Maybe? Well I can tell you now that you're not at +1%, you're slightly under that figure. 15 trades for just less than a 1% gain? Yes its positive, but is it not better to simply wait for the high probability trades and take a +1%? Remember that less is more, and that patience is a virtue. Being ready to walk away from lower probability opportunities and waiting for the obvious setups is a far more sensible option. It leads to less work for a higher return, which is what we're all after. As you learn to trade over time, you will realise that less is more, you want to trade as little as possible to make as much money as possible. If you trade daily charts, you can trade from as little as 20 minutes a day.
So remember, it's OK to walk away from a trade if you don't like it, in fact I urge you to do that. Ask yourself if you would put half of your account on the trade, suddenly you'll find yourself a lot more selective... (don't actually do it though).
Walking away from a trading opportunity is a very difficult thing to do, but sometimes it is necessary to keep capital and live to fight another day. Remember that the market is open 24 hours a day 5.5 days a week. The markets have been around for longer than any of us have lived, and they will likely continue long after we die. Therefore we need to recognise that there will always be another opportunity. There will always be another trade. We should focus on high probability opportunities, and nothing else.
Think of it this way...
Let's you have a $10,000 account, and you are risking 1% per trade. You are looking to make 1% return per winning trade. If you have 7 losers, and 8 winners, are you at +1%? Yes, No, Maybe? Well I can tell you now that you're not at +1%, you're slightly under that figure. 15 trades for just less than a 1% gain? Yes its positive, but is it not better to simply wait for the high probability trades and take a +1%? Remember that less is more, and that patience is a virtue. Being ready to walk away from lower probability opportunities and waiting for the obvious setups is a far more sensible option. It leads to less work for a higher return, which is what we're all after. As you learn to trade over time, you will realise that less is more, you want to trade as little as possible to make as much money as possible. If you trade daily charts, you can trade from as little as 20 minutes a day.
So remember, it's OK to walk away from a trade if you don't like it, in fact I urge you to do that. Ask yourself if you would put half of your account on the trade, suddenly you'll find yourself a lot more selective... (don't actually do it though).
Learn how you can create a secondary income in just 30 minutes a day. Now is the time to create a passive income. Click here to Learn How To Trade.
http://learntotradeonline.co.uk
http://learntotradeonline.co.uk
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