Today, I want you to look at the three stock charts below and tell me their similarities and differences…
WW Tuesday Intraday, One-Minute Candles Chart; SteadyTrade
WW Wednesday Intraday, One-Minute Candles Chart; SteadyTrade
WW Thursday Intraday, One-Minute Candles Chart; SteadyTrade
Knowing you can’t really answer me back, I’ll lay out the differences and similarities…
Similarities: All of them are the same stock: WW International Inc. (NASDAQ: WW); all of them show winning returns; and all of them were winners on Oracle green signals.
And now for the differences: None!!
Okay, okay, yes, the dates are different: The first chart was from last Tuesday, then Wednesday, and then Thursday.
Many emotional traders will find these other differences and comment:
Tuesday was great! WW returned 23.96%*! I love Oracle!
Wednesday sucked! WW only returned 5.26%*, and then I got stopped out! Oracle doesn’t know what it’s doing! WW is a horrible stock!
Thursday was awesome! WW returned 37.97%*! WW is the best stock ever! Oracle is the greatest tool around!
I kid you not, comments like the one from last Wednesday and Thursday really did happen. (However, the statements above are not verbatim.)
On Wednesday, people were mad that WW didn’t do what it did the day before. It didn’t go up as much as they wanted it to, and then they got stopped out. They thought Oracle hadn’t done its job.
Et voilà! On Thursday, they sang the praises of WW and Oracle once again.
Here’s the truth:
WW is exactly the same company today as it was yesterday, last Thursday, and last Wednesday…you get my point. It’s the same crappy day trade stock every single day.
Nothing has changed with WW.
And Oracle is doing the same thing today as yesterday, last Thursday, and so on.
Nothing has changed with Oracle. I love it just as much today as I did yesterday, and I couldn’t trade without it.
Traders who react the way I described above are emotional traders, and they need to take a step back and examine their behavior.
I said this the other day during my Double Down session: If you’re euphoric when you win and really angry when you lose, your P&L (profits and losses) will follow.
The ideal trader takes each win and loss in stride and moves on to the next thing.
Emotion has no place in trading. The market doesn’t care how you feel.
Trading is about surviving so you can come back again, trade some more, and grow your account.
At the end of the day, in trading, it’s you versus yourself.
Can you make the right choices? Can you stick to your plan? Can you keep your emotions in check and stay disciplined?
Have you ever thrown your notepad, slammed your keyboard in frustration, or worse?
I get it! No one’s perfect, and I’ve been there!
Table of Contents
Accept What You Can’t Control
The first big lesson in trading is realizing that some things are just beyond your control. The market will do what it wants.
You can do everything right: your research, your entry, your setup…It can all be perfect. But when news drops out of the blue, you need to act fast.
By the way, every successful trader needs a powerful trading platform to do all of the above: research your stocks, time your entries, and practice your setups in a paper trading environment before risking your own capital.
If you don’t already have one, my top pick is StocksToTrade. I use it every day.
It has all the things traders like me look for in a platform. It also has a selection of add-on alerts services, so you can stay ahead of the curve.
Grab your 14-day StocksToTrade trial today — it’s only $7!
Here’s one of the best pieces of advice I can give you: If something unexpected happens and your position starts moving against you, cut your losses immediately and move on. This will save you from emotional turmoil.
Stick to your plan and get out as soon as the idea is busted.
Do you have a well-constructed trading plan? If you don’t, watch my video to learn how to create one.
Detach and Step Away
Now, how will you react when you take that loss?
You have to detach yourself from your trading.
One of the things many traders forget is that you can just step away. You’re not in school, and you’re not at work. No one is forcing you to be there.
If a trade goes south, you don’t have to stay there, stewing in your frustration and risking more losses.
Go for a walk, hit the gym, read a book. Even better, go away until the next day when you have a fresh mindset.
Don’t Dwell on the Last Trade
Another major mistake I see is traders getting stuck on their last trade, kind of like the WW situation.
Yay, WW had a nice return last Tuesday. Great, take the win and move on.
Don’t come back on Wednesday expecting the same stock to do the same thing. By the way, this is especially true for low-quality day trade stocks like WW. That’s why it’s a day trade stock!
If it doesn’t do what you expected it to do, find something else to trade…or don’t trade at all!
Don’t let a losing trade define your mindset. Focus on the next trade, the next 10 trades, or even the next 100 trades.
Today’s trade doesn’t impact where you’ll be next week, next year, or even a decade from now.
Think long term. Your goal is to slowly grow your account over time.
No single trade will make or break you… unless you let a small loss turn into a disaster, which can happen if you dwell on it and refuse to let go of the position.
My Final Thoughts…
Lastly, remember that trading is a marathon, not a sprint (yes, I’m using that old adage).
If you’re here hoping to get rich overnight, this isn’t the right place for you.
I’m all about building sustainable skills.
To build sustainable skills, you must be able to survive the trading battlefield, come back the next day, learn some more, trade some more, and gradually grow your account.
But you can’t do any of that if you attach your emotions to your trading.
It might be difficult at first, but if you can separate those two things, you’ve made the first huge step towards success.
In the meantime, learn more about trading psychology and strategies during one of our free daily webinars.
They run all day and offer trading tips and tricks, information about how we use our proprietary Oracle system, and other valuable training.
And to see what stocks I’m watching and how to trade them, subscribe to my StockstoTrade Advisory service.
Every STT Advisory member gets a monthly newsletter with my top stock picks, three weekly videos that show my watchlists, bonus reports, and more.
Sign up for StocksToTrade Advisory right here!
Have a great day, everyone. See you back here tomorrow.
Tim Bohen
Lead Trainer, StocksToTrade