Trade with EGO!!! CUT Losses (Follow Confidence is key when you are trading b…

Trade with EGO!!! CUT Losses

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Confidence is key when you are trading binary options. You certainly do not want to be overconfident, but when you lack confidence, your actions tend to mirror your beliefs about yourself. Because you do not believe in your ability to trade well, you tend to make poor judgment calls which result in losses. As those losses pile up, you lose even more confidence, and find yourself in a vicious cycle.

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How can you pull yourself out of that cycle and regain the confidence which you need to succeed?

Go back to testing!!!
First off, stop trading live. It is not wise to continue to lose real money when you know that you need to back off from the market and take a deeper look at your trading decisions. So stop trading with real money for a little bit, and go back to demo testing, maybe even backtesting. This removes some of the pressure from you while you are learning to regain your edge. Once you have demo tested profitably again for a couple of months, you can get back to trading live. You may feel impatient about this process, but you will lose less money and therefore ultimately less time if you take the time to go back to testing.

Diagnose the problem!!!
You are going to need to get to the bottom of what is costing you money. This may be a very involved process which itself could involve a number of steps. Start going back over your trading journals and reviewing the decisions you have made. Look for patterns in the trades which lost money. Start going back over charts of recent trades to see if there is something you may have missed. When you can actually figure out the cause of the problem, you can fix it, and when you start seeing better results in your demo testing again, this will help to restore your lost confidence. You will then feel much better about going back to live trading.

Try to resist the urge to discard your system entirely (unless it truly is worthless; but if it was working fine before, it probably isn’t) and go back to the drawing board. The search for a perfect trading system never ends well. In fact, it never ends at all unless you decide to stop doing it. This is because there are no perfect systems and there never will be. There is only perfect execution of a good system which generates consistent results. You will always lose some trades, even with the best system. If you have a great foundation, do not throw it away because of lost confidence. Get yourself and your system to the point where you can believe in what you are doing again.

When you are working on figuring out why you are losing money, do not forget that the problem may not be technical in nature or have anything to do with your trading system. You may be losing trades because of psychological weaknesses in your trading. Maybe you have been trading when you are angry or distracted. Perhaps you have been sabotaging your success because you do not believe in yourself to begin with.


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