"No way, another loss this week? It's the 7th loss. At this rate, I'm going to lose all my capital."
That was me. Friday evening. Scalping EURUSD on the 5-second chart during the New York session. I'd skipped a friend's gathering to trade at home.
"It must be my trading psychology. That's why I'm losing." I opened the PDF of *Trading In The Zone* by Mark Douglas, looking for which part of my psychology I needed to fix.
The YouTube guru told me this strategy would definitely work during New York. All I got were losers.
I was stuck.
Meditation Will Not Make You Profitable
If I train myself to be monk-like and not care about results, I'll be disciplined.
If I'm disciplined, I'll follow my trading rules.
If I follow my rules, I'll be profitable.
I don't know about you, but I thought this was the key to improving my trading psychology.
Little did I know, even with the best psychology, I wouldn't be profitable if the one thing that matters most wasn't solid: the trading strategy.
The strategy looked profitable when the guru showed me on YouTube. But I never collected my own data. I didn't know the win rate. I didn't know the average drawdown. I didn't know the expected value.
If meditation worked, every monk would be a profitable trader.
Good Risk Management Won't Save A Wrong Strategy
OK, but I'm risking 1% per trade. Surely that protects me.
I always kept the 1% rule as my golden principle. I knew the law of large numbers would play out. I knew to focus on execution and let the profits come.
But am I really smart for applying 1% to *any* strategy?
This sweep-and-retest strategy was from another YouTube guru. He showed me 5 wins last week. 5 out of 5. 100% win rate.
Who wouldn't want that?
I put it into action.
- Monday: 2 losses. Normal variance.
- Tuesday: 1 loss. Bad luck.
- Wednesday: no trades.
- Thursday: 1 loss. The winner has to be coming.
- Friday: 3 losses. I took more trades to end the week green.
7 losses. One week.
The market context was completely different from what the guru showed. Good risk management can't help you if the strategy doesn't fit the context.
So how do you know if your strategy fits?
You Don't Have The Data
Win rate 18.9%. Average win 6.34R. Average drawdown 2.76%.
Those are my live numbers.
Do you know yours?
If not, you don't have a psychology problem. You have a process problem. It doesn't matter how many psychology fixes you stack. The root of every loss is in the data you don't have.
I have 1,000 backtested trades. That's where my confidence comes from. Not from a guru. Not from a book. From my own data.
When I'm in drawdown and down for the week now, I don't open YouTube to search for the next system. I close my chart, sit on my sofa, and enjoy my night.
Your Friday night could look like this. The question is: do you have the data to back yourself up.
Get to 100 backtested trades before you conclude anything about your strategy.
That was me. Friday evening. Scalping EURUSD on the 5-second chart during the New York session. I'd skipped a friend's gathering to trade at home.
"It must be my trading psychology. That's why I'm losing." I opened the PDF of *Trading In The Zone* by Mark Douglas, looking for which part of my psychology I needed to fix.
The YouTube guru told me this strategy would definitely work during New York. All I got were losers.
I was stuck.
Meditation Will Not Make You Profitable
If I train myself to be monk-like and not care about results, I'll be disciplined.
If I'm disciplined, I'll follow my trading rules.
If I follow my rules, I'll be profitable.
I don't know about you, but I thought this was the key to improving my trading psychology.
Little did I know, even with the best psychology, I wouldn't be profitable if the one thing that matters most wasn't solid: the trading strategy.
The strategy looked profitable when the guru showed me on YouTube. But I never collected my own data. I didn't know the win rate. I didn't know the average drawdown. I didn't know the expected value.
If meditation worked, every monk would be a profitable trader.
Good Risk Management Won't Save A Wrong Strategy
OK, but I'm risking 1% per trade. Surely that protects me.
I always kept the 1% rule as my golden principle. I knew the law of large numbers would play out. I knew to focus on execution and let the profits come.
But am I really smart for applying 1% to *any* strategy?
This sweep-and-retest strategy was from another YouTube guru. He showed me 5 wins last week. 5 out of 5. 100% win rate.
Who wouldn't want that?
I put it into action.
- Monday: 2 losses. Normal variance.
- Tuesday: 1 loss. Bad luck.
- Wednesday: no trades.
- Thursday: 1 loss. The winner has to be coming.
- Friday: 3 losses. I took more trades to end the week green.
7 losses. One week.
The market context was completely different from what the guru showed. Good risk management can't help you if the strategy doesn't fit the context.
So how do you know if your strategy fits?
You Don't Have The Data
Win rate 18.9%. Average win 6.34R. Average drawdown 2.76%.
Those are my live numbers.
Do you know yours?
If not, you don't have a psychology problem. You have a process problem. It doesn't matter how many psychology fixes you stack. The root of every loss is in the data you don't have.
I have 1,000 backtested trades. That's where my confidence comes from. Not from a guru. Not from a book. From my own data.
When I'm in drawdown and down for the week now, I don't open YouTube to search for the next system. I close my chart, sit on my sofa, and enjoy my night.
Your Friday night could look like this. The question is: do you have the data to back yourself up.
Get to 100 backtested trades before you conclude anything about your strategy.
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Penafian
Maklumat dan penerbitan adalah tidak bertujuan, dan tidak membentuk, nasihat atau cadangan kewangan, pelaburan, dagangan atau jenis lain yang diberikan atau disahkan oleh TradingView. Baca lebih dalam Terma Penggunaan.
Penerbitan berkaitan
Penafian
Maklumat dan penerbitan adalah tidak bertujuan, dan tidak membentuk, nasihat atau cadangan kewangan, pelaburan, dagangan atau jenis lain yang diberikan atau disahkan oleh TradingView. Baca lebih dalam Terma Penggunaan.