As I was going through the responses I received when I opened up a discussion with all of you…
There’s one that stuck out to me the most.
“Very bad, lost about everything I almost have and I do not know how would I get it back about $20,000. Can you suggest something so I can recover my losses.”
This trader took a large hit on their account, and understandably, they feel lost and frustrated.
If you’ve never taken a hit on your account before, that’s great to hear.
However, there will most likely come a day when you take a loss larger than normal, and you’ll want to learn how to bounce back.
If you’ve taken a hit on your account, and don’t know what to do…
I want to show you how I bounced back when I lost about half of my account when I first started out trading…
And started to trade with an edge in the market.
Taking losses is all part of the game. It’s how you approach trading after the fact that will either make or break you.
If you’ve ever taken a large loss, it’s definitely painful (I know that feeling all too well). Most traders will look at their red profit and loss (P&L) statement and just turn a blind eye.
Instead, what I believe is most important is to look back at the trade and try to figure out what you did right, what you did wrong, and then you should be able to figure out some of your bad habits.
If you’ve taken a string of losses… well, then you’ll definitely want to re-evalute your strategy. The easiest way is to keep a log of all your trades.
It’s incredibly important you keep journal entries of all your trades (not just the good ones). You see, when I lost nearly 50% of my $15K account when I first started trading…
I didn’t just quit trading for good (although, I did think about it).
I actually looked back at all my trades.
I pretty much had to start from square one again. I had to find my edge in the market and remain disciplined (that meant not throwing any bets on random trades).
Of course, I had to start small.
I focused on making good trades, and had a set profit goal for a period of time. Once I reached those goals, I started to trade bigger.
Over time, I figured out my edge in the market, which happens to be catalyst trading. When I became a profitable trader, I was able to size my trades larger and test new strategies out.
So what’s the takeaways?
- If you just took a large loss, it’s okay to step away and re-evaluate your trading.
- It makes sense to trade smaller and not try to make back the losses all in one trade.
- Make sure to journal and review your trades and uncover your bad habits (and good ones)
If you’re struggling in the market right now, I understand where you’re coming from. However, it’s on you to try to become a better trader.