How do I deal with missed forex trades?
Direct from the desk of Dane Williams.
Now that the year has finished, I’ve seen a few traders talking about your biggest regrets and missed trades of last year.
Don’t!
The best piece of advice I can give is to forget about missed opportunities that you are looking at with the advantage of hindsight.
Hindsight is a curse that will torture you if you let it.
Remember, all that matters is whether you executed your trading plan to the conditions that you saw at the time.
Looking at trades with the advantage of hindsight is a curse
The temptation to scrutinise missed trades with the clarity of hindsight can be overwhelming.
It's January 1st, and as I mentioned above, I've noticed a few of you on INLEO discussing your regrets and overlooked opportunities from the previous year.
“What is the most money you’ve left on the table in a trade?” and the like.
Why oh why are you doing this to yourself?!
I firmly believe that this retrospective analysis can be a curse.
Why?
Because it leads to unnecessary self criticism and a sense of missed potential when the reality is that you most likely made the right decision at the time.
This is why Instead, I advocate for a shift in perspective if you’re struggling to deal with missed forex trades.
As a forex trader, you know better than anyone that conditions in the markets change rapidly and as a result, that decisions have to be made in the heat of the moment.
While it's natural to ponder what could have been, it's essential to recognise that the you followed your trading strategy and not every missed opportunity was within your control.
Dwelling on what could have been blinds you to the fact that your decisions were based on the information and market conditions available at the time.
Not to mention FOMO in forex can lead to impulsive actions, causing you to deviate from your carefully back tested trading plan.
You do everything to avoid FOMO at all costs, but then get upset when you miss a trade?
Come on, that doesn’t make any sense.
Receive the full value from your forex trading journal
Instead of pining for missed trades, I encourage you to put focus into reviewing your forex trading journal.
Rather than fixating on regrets, channel that energy into a thorough review of your trading plan, setup and your thoughts in that exact moment.
That is all that matters, not the hindsight you have now.
If you followed your trading plan then that’s all that matters.
You see, your forex trading journal is a valuable tool, offering insights into your decision making process at the exact time of your trade.
By revisiting the specifics of the setup, the market conditions and most importantly your mindset, you gain a nuanced understanding of your trading approach.
Were you following your strategy?
Did you adhere to risk management principles?
These are the questions that matter.
The full value of a trading journal lies not in dwelling on missed opportunities but in learning from them to not only enhance your future decision making, but to help you deal with missed forex trades going forward.
Final thoughts on dealing with missed forex trades
Look at the start of each new year as an opportunity to reinforce a positive and forward looking mindset in your forex trading.
Rather than fixating on what could have been on missed trades, embrace the lessons embedded in your trading journal.
As long as you executed your plan based on the conditions at the time, you've derived the maximum value from that trade.
Regardless of its outcome!
Let go of the hindsight curse, leverage your trading journal and stride confidently into future opportunities that the market will always present you with.
Best of probabilities to you.
Posted Using InLeo Alpha