The Uphill Battle of Coming Back
Hey everyone, Ross Cameron here! I want to be transparent with the journey I experienced this December, particularly the struggles in navigating the market’s erratic behavior. December has surprisingly become the month where I’ve encountered substantial challenges, especially on Wednesdays. Unfortunately, last Wednesday marked my biggest loss for the year, and history nearly repeated itself just a week later with another significant red day. I faced losses across all three stocks I traded, and it’s safe to say frustration was the sentiment of the day. This episode of reflection is prominent because there are valuable lessons in each setback that I’ve encountered this month.
Analyzing the Setbacks
Evaluating my performance, I’ve noticed some recurring issues that have become more prevalent. These setbacks have prompted me to halt and truly assess my strategies. For example, my approach towards trading $LGVN resulted in an initial loss. The stock had momentum, but my attempt to capitalize on a dip around the volume weighted average price (VWAP) led to an unsatisfying outcome when the expected bounce didn’t materialize, resulting in a $432 setback. To recover, I need to reexamine my timing and entry points, ensuring that they align better with market conditions.
The Emotional Roller Coaster of Trading Day
Throughout the trading day, emotions can swing wildly, especially when substantial gains turn into losses within minutes. I’ve experienced this firsthand with the stock $LQR. After some successful trades turned around $2000 in profits, complacency quickly became my downfall. I saw my position switch from green to red, an emotional trigger that many traders can empathize with. It’s a stark reminder that discipline is crucial, and that I need to adhere more strictly to my rules of limiting losses and protecting gains, no matter the profit size.
Making the Hard Decisions: When to Walk Away
A key lesson from this month’s experiences is the critical importance of knowing when to walk away. After transitioning from a profitable to a losing position in $LQR, I had the opportunity to stop at break-even for the day, a decision that would have preserved ten thousand dollars. Hindsight makes this error clear, but in the heat of the moment, it’s easy to underestimate the psychological impact of a drawdown. Recognizing these emotional triggers and responding proactively is pivotal for any trader intent on long-term success.
Confronting Aggressive Trading with a Cool Head
Aggressive trading is sometimes tempting when trying to recover from losses. I took a ten thousand share position in $LQR, significantly ramping up my risk profile. Unfortunately, those heightened stakes led to intensified losses. When a new opportunity presented itself, such as $ADIL appearing on the scan, my reaction was to engage swiftly but, once again, the market proved unforgiving. Moving forward, I need to temper my aggression with prudence, focusing on sound strategies over high stakes to ensure consistent performance rather than sporadic volatility.
In summary, December has been a month of introspection and recalibration. The journey’s been tough, but the lessons are clear. Trading is not just about strategy; it’s also about managing emotions and expectations. As I move forward, I’m reminded that risk management, discipline, and the ability to adapt are integral components of a trader’s toolkit. Now, it’s time to take these lessons and look ahead to finishing the year on a more positive note.
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