Have you ever been guilty of micromanaging your trades?
I'm sure the answer is yes.
And what did you do?
Stop trading? Walk away? Close shop?
Bet you did not! And what was your daily result?
An ugly deep, deep red, I'm sure.
Micromanaging means, your heart is in each and every trade. And when your heart is involved, well, then you better make sure, the trade is a winner. Noone likes a broken heart!
Unfortunatly Mr. Market does not care about your or my heart. If you do 10 trades, chances are that 3-5 will be losers. When micromanaging you are most likely guilty of taking early profits, just because you are green and have a small profit. But the losers, where your heart is in can be really damaging, because you let them ride into the disaster stop, you will add to the trade, just to make sure it's no loser, and cling to it while another contract you usually follow offers wonderful trading setups, which you can't take as you first have to make sure the open trade is closed at a profit.
So this micromanaging really is the first step to a disaster day.
I did 10 trades today. I made 133$ profit. Of these were 2 trades on the HSI, which I closed at 3 ticks profit only to see HSI break 100 points right after, that’s 18$ profit vs 625$ profit potential, then I was in 2 Euro trades closed at Breakeven + 1 tick, which were 20 tick potential trades (250$/contract) and 2 losing trades (covered at Breakeven +1, which inspired me to this article), of which one Euro trade was held through 2 news announcements, which went max 40 ticks against me and came back. These 2 trades had the potential to make my day deep, deep red and only hope, luck and a bit of market knowledge saved me from this fate today.
So I wish you all a great weekend and I really hope, I'm over this micromanaging illness on monday.