Are you a Forex trader? Are you “in it to win it? Are you looking for profits wherever possible? That means you will be examining the results of the trades that you take and learning from both your successes and your failures. But what about “the ones that got away”, the trades that for one reason or another never happened and nearly always would have turned up trumps.
Why do we miss out on trades, especially the ones that will cause us so much heartache subsequently? There are of course loads of different reasons. You could have chosen to “sit this one out” having had a couple of losing trades just previously. You could have been too preoccupied with another trade or considered that it just didn’t fit into your preconceived trading pattern. You may have had enough for the day having met your daily target or you might not have had enough balance to proceed.
Now these are all good reasons, but the fact remains that a missed opportunity is a missed opportunity which will cost you in the fullness of time. You might not realise how much money you are actually losing by not taking up those missing trades and all the potential profits that have vanished unless you are honest enough to track everything in a journal.
If you are a mechanical trader, you can well find that your performance will be down and you will not get a full idea of whether the system is working for you.
If you get into the habit of missing trades, especially after a losing streak, you must treat that as a really bad one. You have to accept losses as an integral part of trading and you shouldn’t have the baggage of previous failure over-influencing your decisions.
Perhaps the most hazardous result of when you miss out on a trade is that your psyche says “hey we made a big error there, let’s make up for it”. This is what is called “looking for revenge” – you go into something that’s a long way short of ideal and trade it aggressively. You lose control of your emotions and at the same time, lose a good deal of money as well.
Missing trades therefore is a bad place to be in. So what can you do to avoid all that? Firstly you could log all your missing trades which would be an incentive to sticking to your trading plan. Secondly set your trading style alarm clock – you could fix price alerts or use entry orders; perhaps even design a mechanical system for your platform. We know you can’t be everywhere but you can help yourself!
Are you missing trades through lack of confidence, worried about the dangers that could affect your funds? If you decrease your position size, you will ease up on a great deal of pressure.
Finally if you focus on the process you will accept loss, take care of it but have the courage to carry on trading sensibly and methodically and in the end you will make a lot of money.