Monday, July 12, 2010

My impatience!

Once again my impatience has gotten the best of me! After exiting CRME prematurely (before it hit my sell stop) two days ago, the event I was anticipating finally happened today. CRME popped up over 4% today and looks poised to break into new high ground this week. This is one area that I am really trying hard to work on. I tried to curb my anxiety about cutting losses by exiting positions in parts. In fact, with this CRME trade I first exited half of the position but I got impatient with its slow moving that I exited the other half although I did not have much at risk.

The lesson I have learned is this: as long as neither the setup and nor market conditions have invalidated the trade then I must hold on until my stop loss or take profit stop is hit or the profit target is achieved!

When you first start trading, it is very easy to watch as your stocks drift down and hit your stop loss. However, after you have been trading for some time and have taken some big hits. One becomes conditioned to take small losses in preference to potential bigger ones and this often means exiting before stops are hit. This makes the above lesson much easier said than done!

In addition, I am discretionary trader by nature so I tend to find difficulty with the mechanical aspects of my trading. Yet I am working hard to combat these weaknesses and continue to look for ways to refine my system so that I can achieve my target of 1 Mil in 5 years!

Good luck and good trading!

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