Trade The Journey

Trade The Journey

Short but Sweet!

I wasn’t sure if I’d post today. I couldn’t sleep last night, and unfortunately, I don’t function too well with less than five hours of sleep. Five is my limit.

Usually, I average about six hours. So instead of the usual fillers, I’ll get straight to the point. I have returned to paper trading. No, I didn’t suffer a significant loss or string of losses; in fact, it’s the opposite. I’ve had a series of winning trades.

Perhaps, I am afraid to lose money or wonder if the next trade will ruin my winning streak. It just feels better speaking about trading when you’ve had a winning trade. It adds a level of surety to your conversation, although it shouldn’t. Ideally, no one should be able to tell what kind of trading day you’ve had.

I returned to paper trading to work on two skills: Letting my profits run and closing positions. Letting your profits run sounds easy, but it’s not. At the forefront of my thinking is the possibility of returning the profits I earned or, worse, turning a winning trade into a loser.

 

So far, I haven’t been able to hold the position long enough to see a great profit.  Usually, I trade in and out of the stock instead of capturing the full trend. I don’t have a problem identifying the trend; I have trouble staying with it.

When I look at the chart an hour later, I always say the same thing, “Had I held the position, I could have made one trade instead of ten.”

I lose patience looking at the fifteen-minute and thirty-minute charts and sometimes get lost in the one-minute and five-minute charts’ noise. I fall into the trap of thinking I have to be doing something. That one thought is probably the source of most of my losing trades.

To let your profit run, you must be aware of the developing pattern and your emotional state. You have to know and trust that you will close the position when required. Otherwise, you’ll be mesmerized by dreams and crushed by hope when your position turns against you.


This week in Review:

The cash flow crunch continues. Have you ever looked at your bank account and wondered where the money has gone?

It’s incredibly discouraging when you are already on a budget. I’ve already cut almost all of my spending on unnecessary items; what more can I do?

You can weather the storm because sometimes everything happens all at once. As long as you have a nest egg, you’ll be alright. I pride myself on keeping my expenses low and my money working to earn a return. Sometimes I splurge, and other times, things happen.

My motto is to keep trying; you’ll be better off than doing nothing to very little at all.

This past week deserves a grade of a “C” for effort.

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