Unsuccessful Trading Behaviors
- Refusing to define a loss
- Not liquidating a losing trade, after you acknowledge the trade's potential is greatly diminished.
-Being stubborn about a specific opinion or belief about market direction.
Remember, MARKET IS ALWAYS RIGHT. If you are caught up in the expectation of what it will do: I am right, the market is wrong will definitely kill your portfolio.
- Focusing too much on price and the monetary value of a trade. Look into the potential for the market to move based on its behavior and structure.
- Revenge trading. This is an odd thing for me, however, everytime I become emotional and start gambling to get the lost money back without making any plan, it tends to lose most of the time.
- Hesitation of not reversing my position
- Not following the rules of the trading system
- Hesitation of not conducting your plan because of the feeling that convince you to against it even though there are profits to make. This would cause to lose opportunities for profits.
- Not acting on your instincts or intuition
- A consistent winning trades over a period of time but giving it back to the market in one or two trades because of the big loss.
Understanding of Group Behaviors
One of the useful understanding of unsuccessful traders is to act as a group. It very similar to a fish or herd of cattle. They simply have a position when they believe they can make money, and they get out because they are either they are losing money or perceive the risk of losing money. For example, people who have no patience are the most impulsive and are the most easily disappointed and share the smallest price objectives and shortest time frame perspectives. Thus, they are the most active and will all be trying to do the same thing at the same time.