I just want to write this down while the pain is fresh in my mind. There are three key areas i want to talk about: chasing, anticipation, and patience. I lose money because of these three things, consistently. And this post is me swearing to stop and also explain why these things must be controlled if you want to become a successful trader. With regard to chasing. I think chasing has to do mostly with FOMO, or, fear of missing out. When you see a stock going crazy, like LINU did today, and because you were looking at other stocks, you miss the meat of the move, you have to watch that you don't pull a rookie ass move and chase. Like i said, today LINU was the main runner. it broke multi month highs and topped out at 3.20, then went all the way down to 2.20, a whole dollar off its highs. Now there was good support here at 2.20, as it had formed an ascending triangle that morning when it broke out; so there was a double top, which now became resistance. And LINU obeyed this support. I had considered dip buying here, but was thinking it be best to wait and see how the stock held this level. It held fine and formed another bottom at 2.24. Now here i shouldve bought. What made me not buy was that i only had 1 day trade left and i didn't want to waste it on a bad entry. Turns out this was the best entry. the stock went back up to 3.00. 80 cents off the low!!! I would've made bank. But every time it kept forming a higher low, as it made its way to 3, i kept saying don't chase don't chase. Finally it came down a little off of 3 and i was thinking, "Well 3.20 is high of day, it could easily break that and form a new high of day, so i want a head start." Now Tim Grattani says a thousand times in trading tickers not to do this. He says, if you do want to get a better head start, dip buy at the bottom of the channel, and thus risk barely anything, but DO NOT CHASE. The only other move would be to buy the breakout if it did form a new high of day. So like an idiot i buy at 2.90, to get that better head start, and next thing the stock changed momentum and came down to 2.53 shaking me out; an 11.22% loss because i couldn't keep it in my pants. I deserve that, however. If i had not followed my FOMO i would not had made this stupid order. This is the last time i will allow FOMO to dictate where i enter. I will either buy at the bottom of these channels, or buy the breakout once it make new high of day. Second thing i want to talk about is anticipation. And this ties into what i did wrong in this trade. In this case i bought in anticipation of the stock breakout high of day. Wrong move. It would've have been the right move to wait and see if it did, not to hope that it would and buy so high off of risk that I'm shitting bricks the whole time I'm holding. And anticipation has to do when you sell in anticipation of the chart not holding. I've lost so much money this way too. What causes you to do this too is fear of losing money. I will not allow myself anymore to fear what has not happened. I must react instead of predict, which is all that anticipation is anyway. Let the chart show you what it is doing, and then act accordingly. Do not sell your position unless your thesis is broken and the chart has broken also. Last thing i want to mention is patience. Now patience is hard. It is tough to see every tick and stay patient to let a chart work itself. I think the best way to be patient, is not to just tell yourself, "stick it through buddy," but instead to enter positions where you are not chasing, but you have instead a good entry: near breakout price, or right above support. So long as you have a clear risk level determined. By making this smart decision, you will be much less likely to be nervous and end up making an anticipated exist, because you were not comfortable. Your level of patience is directly correlated to the level of comfort you have given yourself in your entry. I hope these pointers serve as lessons. Don't make my stupid mistakes, learn from them so you don't have to make the say ones. I know for a fact these hard loss has taught me to not chase, enter where it is safe and not sell in anticipation of anything.
Oh My God. I could have written that word for word on $ LINU and add to the fact it was the middle of the freaking day. I had a stop loss ready to go except Tim Bohen thought this was a near perfect set up. another mistake by listening to someone against my want to exit the trade. lolololol
Yes, yes, yes! I had some really great trades this week. And then I had even more terrible trades... really, really bad. FOMO and not having patience were my two killers. Also, I just need to study more, to truly understand where the bottom support is at. I am still not understanding it completely yet and need to be more conservative on my trades until I get it...or don't trade at all!
You tell yourself you won't fomo again but honestly a fomo every now and agin isn't the worst thing as you are in action which
God I wosh you could edit comments and doing this on a mobile phone is just too difficult so I'll end with Good Luck and keep trading as like active traders are a dime a dozen around here.
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