Not sure if its just me or it happen to everyone else...
Ok this is a story of the difference between what i want, what i expect and what will actually happen. Or rather, a little true story of greed and fear.
I believe most of us would have read stuff like having a system, or a set of rules to follow strictly to, be it online or books we grab off bookstore shelves... Yes, im just like the majority of self learning traders-wannabe out there.. i came out with a system that (i hope) suits to my style of trading.
Imma skip the part whereby we came up with that signal entry and exit thing. We all have our own different way of entry and exits. What im actually want to talk about... is the part where we set the stoploss and take profit level.
So generally, we all have a certain percentage of our account that we are willing to lose and also... not to mention, the best part.. the part where we plan how much we can rip from this trade. That is the profit part.
Ideally, profit should be bigger than the loss. We read stuff like 1:2 or at least a 1:1.5.. worst to worst... 1:1.. right? Well logically thinking, we wouldnt want to have our risk of loss higher than that of profit. Very safe i would say. Because that is what i am doing.
So there we are, entering a trade when the entry signal came, we try to set the parameters for SL and TP.
Subconsciously, i will have in mind where i want my TP to be... We all know that our system will give us an exit, like the last peak? Or at one of the major resistance level? But what if these level doesnt rip u the amount of pips you want? It could be like 10pips away to your ideal ratio of 1:2... Greed perhaps.. i will sometimes set my TP at the level where I WANT.. L O L... As im typing now, i know it is stupid... but in the midst of making that decision during trading... Emotions come in.
So well sometime my greed pays off.. but usually, there isnt any good ending.. HA HA
Not only did greed affects my decision. sometimes fear also makes me set my TP at safe level. So the ending is of cause, wasteful. I will waste a chunk of the profit due to my bad decision to be safe and not go for more. Amateur mistakes.
As for SL, discipline and past bad experience tells me that i should just set it at a point where its the amount of loss that im willing to risk. Simple as that.
Fortunately, that was the past me.. It seldom happen now. Occasionally i still have the itch to.. you know, get back to old self.
If you did what i did, and still doing what i did... You are not alone............ I know that feel bro. Keep resisting the temptation yea?
"This is John Connor. If you are listening to this,you are the RESISTANCE."