My Big Mistake7th April 2019
After much reflection, I realise I made a big mistake in my trading in 2018.
Early in 2018, I developed great conviction that the USD would appreciate. Subsequently it did, and I made some money from the move. I was patting myself on the back for a job well done. But no, I had made a huge error.
It goes back to the old trading adage of let your profits run. Instead of scaling into this move, I was timid and I scaled out of it. Rather than booking large profits, I booked small ones. These were soon chipped away at when the market turned sideways.
In talking to my trading coach, the error became obvious. I was focused on the equity curve. I was worried about giving back profits I had made in case it looked bad. (I was sending out these trades as signals.) What I should have done, in the immortal words of the great Stanley Druckinmiller, was to have “the courage to be a pig”.
The moral of the story? All the technique and knowledge will not get you far if your mindset is wrong. Mindset is the key determinate of trading failure or success. This is a lesson I keep learning over and over again in different ways.
Why am I telling you this? Writing this article is part of taking ownership for my errors. By putting this into words, it helps me keep a clear mind and gives me the bravery to trade with my convictions. And if it helps you to learn the lesson too, that is perfect.
All the best in your trading and be a pig!
About the Author
Sam Eder is a currency trader and author of The Consistent Trader and the Advanced Forex Course for Smart Traders (get free access). He is the owner of www.fxrenew.com a provider of Forex signals from ex-bank and industry traders (get a free trial). If you like Sam’s writing you can subscribe to his newsletter or get FREE access to his acclaimed How to Be a More Consistent Trader Short Course.
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