Letting Profits Run Part 2
The point is that a trader is in a certain frame of mind, knowing when he/she is in tune with things and when he/she is not. Let's continue with my example of this week. I took a position trade on ATML at 11 with the plan of 11 1/4 break or stop at 10 1/2. I had to take 9/16 loss at the open on the failed trade. Once again, Monday through Wednesday trading began to make my ego creep back into my state of trading. And with one trade, the balloon gets deflated. Did the market change? Not really, yeah we came back into a broader downtrend, but stocks were still making nice moves. What changed?
I changed. Where I could do little wrong, where I could feel good about my trading, my zone, my mindset. It was dampened by this trade. So where do I go from here? Did I feel in tune with the market, with stock action, with reading, with myself? Not really, this trade had an effect on me. It's a feeling that I constantly struggle to alleviate, as no one trade is worth our time. It's not worth losing focus, losing resources of developing proper mindsets and losing frustration on. It setup, it was taken, it was a loss. However, the little bit of ego that was creeping back into me from Monday to Wednesday put a bit of negativity in my personal self. How did I resolve the issue? I traded same setups on stocks that were speaking me to me.
First trade was BVSN, I took a loss. Now I have ATML and BVSN losses to start the day. Did I throw my hands up in the air and quit? The contrary occurred. I was forced to rebuild a bit of my confidence. VIGN sets up, I take the scalp. What was my comment on VIGN?
[09:55] VIGN looks still strong if you are holding for better than scalp
[09:55] I just needed confidence builder :)
Now you know why I needed confidence builder. I was able to read the stock in a certain fashion, it was still talking to me, but I needed to know I could still take profits if I had to. I was getting back into a groove necessary for me to
regain confidence. For many, this may not be the way to do it, to regain a confidence. For me, this is my resolve.
Did I know it would go to 21 1/2? Of course not, but it did behave in a fashion that a move higher than where I exited was possible. So why didn't I hold it, re-enter, let my profit run? In this case it was not because of the system, the principle of tape as you can see. Tape said it had potential to go higher and it ended up doing so. So we move our resolve back to ourselves, our psychological mindset at given intervals throughout the day. I wasn't in the mindset that I wanted to hold, I needed a confidence builder. I took the same on SAPE and ADCT my confidence was restored through 3 simple minimal profit gains. In hindsight, I exited SAPE near the high. In hindsight, I exited ADCT pretty close to it's top of the oscillation. So while I was able to take profits to rebuild confidence, I was also shown that if I had held, I wouldn't have been able to squeeze much more out of the trade. |
