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Was trading this morning, taking my signals. I was all of the sudden big in the red with a few losers, close to my daily loosing limit, I couldn't stand it. Got some good scalps, made it back to only -$140.
I only need one big good trade to get me to my daily profit target again. Then it happend, I took a loser again. And said WTF. My GF said she wanted to go shopping at 11.30h
I had another 30minutes to go, I started trading like mad. 55 trades. Without any entry signal. I said, now it's going to drop: ENTER, = looser, I said, now it's going to drop: ENTER = looser, I said now it's going to go down : ENTER = Break Even.
WTF was I thinking ? I was shouting to myself: You stupid moron, stop trading like that, but I looked at the watch and said: I still have 10 minutes to make this loss up !!!!
I stopped now. Said to her we'll leave a few minutes later so I could type this. I'm so ashamed of myself. 55 revenge trades with a big loss in outcome.
OK, my account can take it. But why wasn't in control of myself ? That is so stupid.
Now where is that book 'Trading in the zone' again ?
Can you help answer these questions from other members on NexusFi?
I'm pretty sure we all go through this from time to time. I know I do, more than I care to admit. I will physically leave the room or I will literally sit on my hands until that revenge is under control. Knowing and admitting your actions is half the battle. The other half of the battle is not to do it again. That's the part I fail at occasionally. Sorry for your loss Metaltrade, enjoy your weekend and hit it again on Monday.
@MetalTrade you are not stupid, but this is a problem, you have to go deeply inside your self and try to find why you act this way, saying stupid to yourself , is useless, seems you lack a bit of mindfullness.
Anyway @TraderSU has just listed two interesting books
@MetalTrade, a thing u can do to face the discipline, is ask your broker to set u a daily loss limit, that if exceeded your positions are automatically closed, and you can't trade till the next session, and to set a maximum open positions, I would say 2% of your balance as daily loss limit, and max 3 contracts at the same time, for a total of maximum 20 contracts daily.
We all have done what yur describing here so dont beat yourself up . What I would suggest though is to focus a little on the above statement you made here because it could let you lead yourself right into self destruction . I found that when I let myself think "I can afford it " or "my account can take it" I began to justify overtrading or bending / breaking my own rules . It pains me when intraday traders get killed out there and are left reeling and trying to make sense of what happened , even worse when the wound is left to be licked all weekend . Trading (or any job) shouldnt be painful on the head .
Before I started trading I would read posts like this and think to myself "I can't understand why people cannot follow their rules and common sense. That will never happen to me!". Then I start trading and I catch myself making the very mistakes I was sure I was not going to make. Humans are flawed creatures. We all have to battle the same types of flawed impulses and thinking. I am sure with time it will become easier to control yourself with regards to these things.
Thanks for sharing, I think many of us went through your experience it takes courage to admit it. BTW "My GF wanted to go shopping" is a 100% loosing trade
thanks for sharing this experience. I think everybody, even if we do not like to admit it, knows very well what you are describing.
Loss aversion
The loss does not match our goals, so we try to avoid it at all cost, forgetting that the cost produces a new loss. There are various stages of dealing with loss aversion.
-> moving your stop loss a bit further
-> doubling your position to make it easier to break-even (Martingale approach)
-> overtrading and revenge trading
-> cutting profits short to avoid that they become losses
The market is designed to exploit our weaknesses, game theory teaches us that you are either exploiting others or that you are being exploited by others. The market is a zero sum game.
Very difficult to unlearn bad habits. Similar to drugs and alcohol. It will work two or three weeks, your will have nice profits and then - only one day - you will fall back into your bad habits again, just to lose more money with a single trade than you have made during your successful weeks.
Impatience
The most difficult task is to do nothing, just sitting and watching. Only accept the best opportunities for trading. One trade per two hours. Just sit and wait for the one opportunity. Finally we know that there are many of them, but as we have the impression that time goes by and we are doing nothing, we enter a trade too early.
Actually, I enter my trades often too early, and to compensate, I exit them too early as well. This is anti-cyclical behavior - similar to the COT positions of the Commercials - but it does not pay out. My alias "Fat Tails" is there to remind me, that moves usually will take further than anyone expected. The market cannot meet the expectation of the majority, this would be contrary to its design, so it must take away money from the majority, and however strange price moves appear, by design they take money from most of us.
Patience is needed to avoid the game, when you do not understand it.
Taking Responsibility
Quite often the wife or girl friend appears, when we suffer from losses, as we try to blame somebody else. I remember a chapter from the book "Pit Bull" by Marty Schwartz. It starts: ' "Buzzy I need a new coat", Audrey said..' and ends ' " Very nice", I said, "But then it ought to be nice. It cost us eight hundred thousand dollars." ' Actually Marty is blaming his wife for not taking care of him as she should have told him to reduce his position. This shows that we always try to blame another person, if necessary the person can be blamed for not having disturbed or guided us.
Guess we need to take responsibility and accept our imperfection. It is all about reeducating ourselves and take the habits required for trading without depleting our accounts. The best description of this type of reprogramming can be found in the books of Brett Steenbarger.
Everybody - and this is certainly including myself - fights his own demons.
