Trader A: I bought xxx today because the MACD has turned positive. The trade is going against me but I decided to move my stop loss lower in case it turns back up. I've moved my stop 2-3 times already, do you think I should cut loss?
Trader B: Mr Guru mentioned that the profit target for stock xxx is $2. Should I go short there?
Trader C: I intend to hold stock xxx even though it was a bad trade. Market overall is bullish so the stock should climb back up.
Can you already see how appalling that is?
Trader A's mistakes:
- Entering a trade based on MACD even though he is a price action trader
- Not cutting losses
- Depending on others for trading decisions
Trader B's mistakes:
- Since when has a profit target become a place to go short? It shows that he is just trying to catch the top
- Depending on others for trading decisions
Trader C's mistake:
- Not cutting losses and justifying it
I wasn't even deliberately looking for traders pitfalls, I came across them while going about my daily activities. And seriously the public forums/facebook groups has tonnes of these occurrences. It is really scary, and sometimes I wonder whether these people are truly ignorant to what is wrong or they're aware but choose to commit it anyway. The greatest obstacle to trading success is not the method nor the market, but the man in the mirror.
No comments:
Post a Comment