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Facing trading difficulties positively

In speculative trading, no matter how qualified and experienced a trader is, the possibility of losses exists. Even for some investors who are accustomed to using trading systems, it is inevitable that they will get into trouble at some point. And the longer you trade, the harder it is to avoid such dilemmas.

Trading against the trend, frequently or heavily, is a common reason for traders to get into trouble. The book The Futures Game says, "The best way for a trader to self-destruct is to overinvest (or trade so frequently and uncontrollably) that he or she cannot extricate himself or herself from a predicament caused by one or a series of bad trades."

Chasing up and down in oscillating markets is a common mistake made by traders, especially late in a trend, where traders are so uncertain about whether the trend will continue that they always assume that every brief up or down move is the beginning of a new trend, and so they buy and sell frequently while stepping to the wrong market oscillation beat. When the trend is really out, they have been distracted by the market oscillation, psychologically unable to make appropriate judgments on whether the trend really emerged, and therefore lose the opportunity to recover losses.

In the trending market, the easiest way for investors to get into trouble is to go against the trend. A lot of investors do the wrong direction, but still go against the trend and wait for a pullback to bring back the old capital. But when the price correction, they began to hope that the market can turn, so that they pick up a "pie in the sky" opportunity.

All of this makes the trader's life difficult. The most important thing to do is to make sure that you have the right tools to do what you need to do. "It is rare for the "net to break". As long as the trade repeatedly loses money or position floating loss continues to expand, you should make the "trading in trouble" judgment. There is no such thing as a general who wins all the time, or a soldier who can't win a battle.

Many investors like to take a locked position to solve the immediate problem, this practice is essentially to maintain the original error at the same time, but also to start a new transaction. In the case of trading mentality has been destroyed, locking positions undoubtedly wear double psychological shackles for their own, often resulting in greater losses for traders.

The way out of the dilemma varies from person to person, and the most basic is to stop opening new positions, which is the only way out of the dilemma caused by frequent trading. The first thing you should do is to reduce your position, and only by taking this step can you "save yourself" and avoid being wiped out. In the position reduction, the trader's psychological pressure will be reduced, then, the remaining position as a new transaction to deal with, and for these positions to set up a new stop-loss, in the price correction or trigger a new stop-loss after all liquidation.

The process of getting out of a difficult situation is difficult and complex, and being able to face it positively and have a plan to get out of it is a sign of a trader's maturity. Trading is not all of our lives, and when it's not going well, withdrawing to feel the sunshine and affection will help us better engage in the market.

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