Warning: Following my trades may be hazardous to your financial health. See Disclaimer.

Thursday, February 02, 2012

Don't Chase - There Is Always Another Trade

It's almost without exception: whenever I entered a trade emotionally without planning, I'd get punished.  Today I kept pondering the prospects of a double top on SPY on the daily chart.  I was away from the streamer for a while and when I came back I saw SPY made new low for the day.  I quickly entered a short position.   And it was practically the low of the day.  I ended up spending the rest of the day fire-fighting to salvage my position.  And that brought up another point: I still have too much ego to admit defeat and take loss.  Fortunately I had other profitable trades today to end the day ($20) in the red.
I've got to stay disciplined, and plan the trades and take losses.