I have been watching the USDCAD waiting for an AB=CD completion for a while now. This particular case looked really good to me because the pattern looked as if it completed right around some really strong daily structure. The only problem was that my D completion leg was actually underneath the lows of the previous structure which presented a dilemma for me. Long story short, when I switched down to a lower timeframe to get a closer look, I saw a pretty good structure level forming around the previous structure lows, but above my original entry plan. The market had been oversold at the lows of the previous structure, retraced, and retested with RSI divergence. This is when my emotions took hold of me, and I told myself that I couldn't miss this opportunity (with it being only 20 something pips away from where I was looking to enter). Not too long later a realized that didn't follow my original plan on how to trade this set-up and I exited the trade for a small loss.
Could I have stayed in the trade, of course. I mean my stops were nowhere near being hit. The point is that I made a mistake, realized that I made a mistake, and terminated the trade instead of holding on to a bad trade. Looking at the pair this morning, I see that the USDCAD has reached the level that I originally predicted and has shot right back up. Now there is no telling this early if this trade will end up to be a winner, but you know what I don't care. In the past I would have been flipping out like "man I was in this trade and if I would have just stayed in I would be up 50pips." Or "I'm going to go crazy if this trade goes on to be a winner without me being in it grrrr!" But I no longer think like that anymore. My mindset now is that win or lose this would have been a bad trade regardless because if I were to look in my trading plan I have written "As long as I follow my rules of engagement I will never enter a bad trade, bad being defined as a trade in which I break my rules."
I wanted to share this to show that even though I have gotten a lot better at trading, I still make mistakes. The difference now is that when I make mistakes, I am now able to recognize them sooner and then I never try to make that same mistake again. More importantly I accept the fact that I made a mistake and don't let my pride get in the way. (In the past I would live or die by my trade and would end up taking big losses due to the fact that I felt I had to be right every time.) Funny how this actually leads me into the next post that I was going to write titled "Kaizen", which I'll be putting up this weekend... hopefully.
Anyway, thanks as always for taking the time to read my post and hopefully my mistake will stop someone else from making the same.
Could I have stayed in the trade, of course. I mean my stops were nowhere near being hit. The point is that I made a mistake, realized that I made a mistake, and terminated the trade instead of holding on to a bad trade. Looking at the pair this morning, I see that the USDCAD has reached the level that I originally predicted and has shot right back up. Now there is no telling this early if this trade will end up to be a winner, but you know what I don't care. In the past I would have been flipping out like "man I was in this trade and if I would have just stayed in I would be up 50pips." Or "I'm going to go crazy if this trade goes on to be a winner without me being in it grrrr!" But I no longer think like that anymore. My mindset now is that win or lose this would have been a bad trade regardless because if I were to look in my trading plan I have written "As long as I follow my rules of engagement I will never enter a bad trade, bad being defined as a trade in which I break my rules."
I wanted to share this to show that even though I have gotten a lot better at trading, I still make mistakes. The difference now is that when I make mistakes, I am now able to recognize them sooner and then I never try to make that same mistake again. More importantly I accept the fact that I made a mistake and don't let my pride get in the way. (In the past I would live or die by my trade and would end up taking big losses due to the fact that I felt I had to be right every time.) Funny how this actually leads me into the next post that I was going to write titled "Kaizen", which I'll be putting up this weekend... hopefully.
Anyway, thanks as always for taking the time to read my post and hopefully my mistake will stop someone else from making the same.
RSS Feed