Giles Coghlan LLB, Lth, MA
Financial Source
One of the attributes that can be most highly rewarded is that of patience. The ability to not act when others do. Looking over last year’s trading results, there were only 3 or 4 leveraged trades that really made the year. Many more trades were unleveraged and resulted in a little gain here and a little loss there. Many discretionary traders note a similar phenomenon. A few very successful trades would make the trading year.
And yet, despite knowing this, the lure of the markets means it is very hard for traders to actually stay out of the market. Trading is enjoyable for its own sake. Trading is also addictive and can result in compulsive behavior. Therefore, one attribute that will really benefit you is this: stay patient. So, on that note, here are some tips on how to stay patient.
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Use a checklist. The power of a checklist in trading can help you avoid mistakes and potentially slow down an impulsive entry.
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Have your trading terminal closed? You analyze the charts on a different platform than the one you trade on. This can provide a precious block stopping you from entering impulsively.
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De-leverage. Surprisingly, risking too much will cause you to enter and exit prematurely. If you have a hard time accepting your money at risk then this will make it hard to leave positions run. You will enter and exit too frequently.
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Use a checklist when you have an open trade. It is easy to lose conviction on a trade over time. So, you entered a market last week, but now you don’t have that conviction. By going back through your checklist you can re-evaluate an open trade to see if you still have a high conviction. Making it more ‘scientific’ in your thinking will help you know whether to hold the position.
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Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Japanese Yen trades just shy of 157.00 versus the USD
The Japanese Yen weakens across the board after BoJ announced its policy decision. A shortlived spike in the Yen may be testament to an attempt by the Japanese authorities to intervene. US PCE Price Index shows higher-than-expected inflation but does little to impact USD/JPY which almost touches 157.00.
Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
Bitcoin Weekly Forecast: BTC’s next breakout could propel it to $80,000 Premium
Bitcoin’s recent price consolidation could be nearing its end as technical indicators and on-chain metrics suggest a potential upward breakout. However, this move would not be straightforward and could punish impatient investors.
Week ahead – Hawkish risk as Fed and NFP on tap, Eurozone data eyed too
Fed meets on Wednesday as US inflation stays elevated. Will Friday’s jobs report bring relief or more angst for the markets? Eurozone flash GDP and CPI numbers in focus for the Euro.
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