Olive oil sprayers are getting very popular these days, and every one of us has one in our kitchen. Buying the best Olive Oil sprayer is one tough job, but once you get one home, you will have to make sure that you are using it in the right way. If you don’t use it well, then you will end up wasting money as you will have to get another one for your kitchen. If you have bought a new Olive oil s...
As a trader, it is important that you review your worst trades. But how will you identify a good trade from a bad one, and vice versa?
There is a frequent misconception that all losing trades are bad and all winning trades are good. Remember, there is more to trading than just making returns. You cannot say that a trade is good or bad just because it is profitable. In reality, there is a possibility to have a good losing trade and a bad winning trade.
Keep in mind that you consider it a good trade if it has been handled and taken based on your trading scheme.
Good Losing Trade
Say your system is calling for a long position 100 and 200 SMAs intersect and the oversold territory was hit by Stochastics. You see here, the market moves up and feels excited to take the plunge, but you wait until the signal of your system lines up before you enter your trade.
Lastly, your system gives you a signal to go along. For a while, the trades work in your favor, but sooner or later turns around and ends you up getting stopped out.
Do not fret. What happened was a good losing trade. You may not have earned profits, but you eventually earned something that will benefit you long-term in your trading career – that is the discipline when you stick to your rules in trading. This must be an attitude that you will notice from a good Forex Broker in France.
Bad Winning Trade
Let us take this scenario, you set your trading rule that you cannot risk in excess of 5% on a one-time trade. Suddenly, you saw a sweet USD/JPY pair which you suppose to have a high probability trade. You cannot resist it and you end up taking the trade. You put 20% of your investment at risk. Say, the trade is a winner and you felt satisfied.
It may seem a good win, but it is otherwise. You might have earned a profit, but you did not follow your own forex trading rules. The favor might be upon that time, but what if the next time you broke your rule did not turn out the same? You will end up regretting thinking that you should have just followed your trading rules. Remember, the forex market changes every time.
If you practice discipline and follow your rules, that is a good sign. If you want to consistently execute solid processes in trading, then decide now to stand by your rules. If you were not able to profit, charge it to experience and learn from it. Even a productive Forex Broker in France may have gone through this, and eventually learned.
Evaluate and distinguish what wrong has taken place and choose to make any modifications next time. This experience will help you improve your performance in trading soon.
If you violated one of your trading rules and your position remains open, get out while you can.
Don’t lose hope when in the midst of a bad trade. Keep yourself together and turn your bad trade into a good one while it’s still possible.
The main thing here is that traders should not just focus on profits, but also on the process. Focusing on the process will result in a long-term profit on your end