We've all had a streak of bad luck in the market that was mind-numbing and just plain annoying. Over the years I've developed some simple steps for dealing with a losing streak.
Step 1: STOP trading. Depending on what kind of trader you are you will know what a streak looks like. A swing trader's losing streak could be 3 trades in a row whereas a day trader is having a string of bad days(3 or more)
Step 2: Determine whether the streak is being aided by the market. Is the market choppy and too volatile?
Step 3: WAIT. If you don't know what to do next just don't do anything. A sideline position is the best position for a trader on a losing streak.
Step 4: Ease back in. Once you have followed the previous steps you can start to ease your way back into trading. Put on a trade 1/3 the size of your normal trades.
Step 1: STOP trading. Depending on what kind of trader you are you will know what a streak looks like. A swing trader's losing streak could be 3 trades in a row whereas a day trader is having a string of bad days(3 or more)
Step 2: Determine whether the streak is being aided by the market. Is the market choppy and too volatile?
Step 3: WAIT. If you don't know what to do next just don't do anything. A sideline position is the best position for a trader on a losing streak.
Step 4: Ease back in. Once you have followed the previous steps you can start to ease your way back into trading. Put on a trade 1/3 the size of your normal trades.
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