Most of the time, if you jump into a second trade right after a green trade, chances are high you lose money. This is because the second trade is a FOMO and you should’ve been satisfied with how the first trade went. If you have trouble with this, keep reading this post to learn a simple remedy that will help you overcome this nagging issue and save your account.
After a green trade, our positive emotional state tends to cloud judgement, particularly for the next few minutes. The euphoria of winning makes us think we can’t lose (or if we do, it can’t really hurt us for at least the amount we just won) and so we tend to be bolder or overly confident. This makes us more prone to jump into trades we would normally give more time for study and set-up.
Many times when we jump back into a trade, it’s not even a legitimate pattern; we’re just jumping onto a moving train. The problem is we don’t know how long the tracks go! Without planning first, you don’t know how close to a top/bottom or significant support/resistance level you are – and in most cases, you’re closer than you thought.
If you’re having problems with FOMO trades like this, Daryl suggests incorporating the following actions into your trade plan. Directly following a winning trade…
1. Accept your win (no matter the size)
2. Get up and walk away from your computer
– leave the room, get a coffee, stretch, etc. but don’t look at your computer for at least the next 2-5 min.
3. Record your trade and journal
Do these steps before setting up your next trade. The delay in time will allow the win euphoria to lessen and your thinking will be clearer. Even if you ended up missing out on a huge profit leg because you exited too soon, accept that there will be many more opportunities and be happy with green.
If you want to make less mistakes and more money with your day trading, learn from the best with our live screen share day trading chat room. Expert pre-market analysis plus watch Daryl show you how to make huge profits with the Limitless Volume system in real time! Check out our live trading room with our 7-day FREE trial here.
