27/5 – Retail Traders don’t have to trade every day / Minimize the damage on the down-days

Early start to the day.  At the desk just before 7am local time (6am London time).

I started to make some preparations. I scored 7 out of 10 on the psych assessment.  That said, I was nevertheless feeling tired and was thinking quite a lot about various family/relatives things.  That did seem to impact on my concentration.  I felt as if I had too many things to do in order to “adequately” prepare for the trading session and felt that i would not have enough time to do it (dude – if you are the desk at 6am London time and still complain about not having enough time – then something can’t be right!!).

I felt that my preparation approach was too structured and that I was trying to fit a square peg into a round hole.  I just couldn’t analyse the market properly.  I didn’t feel confident.  I took a trade on EURJPY (entering at 6:35am!!) – see charts below – which I closed a few minutes later when it looked to be going against me.

376 eurjpy May27

376 eurjpy May27 (1h with more comments)

STOP IF THE CHARTS DON’T MAKE SENSE TO YOU

stop sign

Being a retail trader, I am able to “not” trade if I don’t feel up to it.  Maybe I don’t feel up to trading every day that i rock up to my desk.  Bear in mind that I missed half the trading sessions in the last fortnight, yet was able to turn a big profit.  It clearly is a fair bit about the quality, rather than the quantity.  On days like today when I just can’t seem to make sense of the charts, it is probably much better for me to refrain from trading – I can do some trading-related work but I should not look to put on trades.  This is one of the luxuries of being a retail trader, and is one that I should exploit.  How likely is it that on a day like today I would be able to turn out a profit by the end of the day? Add to that difficult market conditions (for instance) and I would likely be giving a lot of money to the markets – 1R. 2R, 3R etc…  Instead I only lost 0.35R today.  Minimise the damage on the down-days.

It’s good to take a note of what type of situations give rise to the conditions in which I (you) don’t feel competent/confident to trade.  That may help me to reduce the amount of times that such conditions arise.

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