Saturday, June 28, 2008

Missing an opportunity

Missing an opportunity for me comes in two different flavors:

One is the missed trade while I was not at the computer for some time and just couldn't take the trade or did not leave a trade open, because I don't like to be in the market when I'm away.

It's a missed opportunity according to the rules.

It might be that I'm angry for a short time, that I think, shit, what shall I do now, that this move has happened and we will most likely see only choppy consolidation for the next few hours. But I missed the trade according to the rules and that is ok, because I have a reason for that rule.

The missed trade which makes a lot more problems and which might actually cause me damage is the missed trade I did not take, even when my inner voice said "Go for it, everything is aligned, you have a signal, take it NOW"

Still for some unspecified reasons, which might be fear, feeling unwell or some other unclear reasons, I override the signal and my inner voice and the market jumps away.

It's these missed opportunities, which cause me problems, because I did not follow a signal, which was there to be taken.

A similar situation arises, when I enter the trade, but then -out of fear to have taken a wrong signal- trail it so narrowly, that the trailing stop will for sure get hit on the slightest wiggle, even if the trade is a good one and the market seconds later does what it was supposed todo.

Most of the times I recognize the symptoms now and stop trading for a while if this problem occurs, because then I know I'm no longer fit to trade. I just don't have the energy and stomach to give the trade the room it needs to develop.
If I don't recognize the symptoms, then the day usually ends deep deep red. Because then unconsciously I will try to make back what I missed with the follow-up trades. And this is a setup which usually ends in disaster.