Futures are printing red after a disappointing ADP Jobs Data report. Can this be the initial trigger of a market correction?
I want to share with you this interesting passage that a trader friend has emailed me:
"As I debriefed trades from many different traders this week, common themes appeared. The first and foremost was a consistent bias for taking profits too quickly. The second issue was moving stops up too tight and too early in the trade. As it turns out, they are quite closely related.
Both issues have to do with a fear of giving back profits. (That’s a blatant case of stating the obvious.) At a deeper level, both issues—taking quick profits and trying to move a trade to breakeven too quickly—have to do with needing to be right about the trade.
And fortunately, both issues have the same solution: exercising the patience to allow the trade to develop. That patience is most easily found by putting together a trading plan that clearly describes where profits will be taken and how (and if) stops will be trailed in the direction of the trade.
If we step back and take an objective look, we can see that taking profits too quickly violates the golden rule of trading—cutting losses short and letting profits run. But in the heat of battle, it’s easy to forget even the most basic of rules." DR Barton, Trading Coach
Still vacationing, but I will keep track of today`s session via my mobile.
Have a great trading day.
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