Home > Apprentice Trader Journals > $Deb Says: How does a positive day turn into a negative one?

$Deb Says: How does a positive day turn into a negative one?

Today was an excellent trading morning to trade and a difficult, choppy afternoon. I was up on the day coming into lunch and down on the day by the end of the day. What happened? The following items are what happened to me today and are things all traders need to watch out for.

  1. We trended in the morning. The trend slowed and then screeched to a stop and then price action became choppy in the SPY. I failed to adjust to this and started getting chopped up.
  2. My psychology shifted from focusing on what was happening on the charts in front of me to the fact that I was down on the day, after being up, and I kept trying to get a trade to work instead of waiting for opportunity.
  3. In trying to get a trade to work, I left my original stock which was trending and had the potential to continue, for another stock. My decision making became flawed and I did not realize it.

 

My positive day turned negative because I made the aforementioned mistakes. It is important to recognize that all traders are susceptible to falling back into bad patterns. The important part is to recognize it and never do it again. I know for myself, this won’t happen again.

Also, it is really important to recognize that the one good thing I did was to stick with my plan to not allow myself to get stopped out or even close to getting stopped out. I basically have a range where I “stop” myself out. That is my one crutch just in case I fall into the “traps” that are hidden in all traders.

I do this because I know that the market is unforgiving when mistakes are made so there must be a limit and that is the indicator to step aside. I also did not take my hypothetical “stop” for myself to the maximum of the range just in case something obvious happened in price action and the market; hence, allowing myself some room to  recoup if an opportunity presented itself.

One thing to always remember and I remind myself of this on good and challenging days. There are always better trades ahead!

Debbie

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