Back to Old Habits?

Posted by Deb | Day Trading Journey | Wednesday 3 April 2013 11:31 pm

I have made a long break from trading for the holiday of Pessach. Yesterday I went back to trading on the demo.

I am discouraged, not sure what I should do about trading. For some reason I was sure this time around would be easy, but it has not been so so far. Yesterday I again had a small loss. Today, I went back to my old habits, which have helped me make nice profits some time ago, but have also led to my ultimate failure in the last time around: I added more contracts to a failing position to “even out” the loss, and waited for the market to turn around to my original direction.

It worked. For a few minutes my loss was growing to $250, but than the market turned around and I quit with a profit of $100.

Does this mean I should go back to my averaging-out method?

On one hand, it seems this method usually works. On the other hand, when you do lose out while adding more contracts, you lose a lot. You need a real big account to be able to wait for the market to turn around.

From my experience in eToro, I see I am not the only one using this method. I guess I will continue to use it at least sometimes, but try to be more careful. Also, I don’t want to let my positions to drag on for too long.

In any case, I intend to continue with the demo for some time until I feel I am doing better.


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