A trader is not losing due to lack of technical knowledge.A loss making trader is having lack of common sense only.
Common sense comes from regular observation, finding mistakes & not to repeat these again.
A trader starts trading very lightly.
He gets profit by chance.It happens because he is fearless in beginning.
When he earns 3000 in 1 day,he simply calculate 25*3000=75000monthly income.
he gets more than planned profit in first week. He becomes very cofident and fearless.
It is hard to understand for him that what is the problem in trading with old traders?
Then suddenly market reverses and shows its quarterly stormy movements,which are undefinable and out of all the calculation for this new trader.
He loses more than all his profit(earned in weeks) in just 3days.
But still he is hopeful to see good chances back,but a deep fear is planted within.
If he had lost 1lac,then he wants to recover this 1 lac in next week.
He tries some good tips and gets 15000 in 2 days with big lot trading.Now he has blind trust on tipper and decides to go for 4big lots in one shot.
A very good tipper may have the chance to hit SL once in a week.So trader loses 40,000/- in single stoploss.
He is blaming his destiny.but common sense says that,
after 2 days great profit we should reduce our targets,bcoz that scrip will be volatile & rangebound due to profit booking pressure.
After every loss, either he blames all others around
(may be tipper,operator,TV channel, broker or wife)
or he blames himself(feeling guilt that he denied a dinner party costing only 4000 to family & lost 40,000/-with nothing in return.)
but he is still not ready to see exactly what happens.
In profit making day,he doesn't feel the need to see & in loss making day he lost mood to see.
He is ready to leave trading next day,but next day he gets a good profit due to his lack of attachment.he has bought 2 silvermicro with fearless stoploss of just 500/-.
Who has the fear in 500/- after losing 40,000/-?
On that day he gets 3500 in 2 micro lots.He is not happy,he is repenting - why hadn't he gone for 2 big 30kg lots.
But now he is back in game.
He is smart enough to find free tips from here & there ?
But unable to see the fact that he has not added a single rupee in his capital this way.
He has made a pattern to repeating mistakes and not to see them.
So what should he do?
learn a right system by removing mistakes day by day.
If you can make 2% out of 10,000 capital means 200/-daily.
continue this for 30days.
then multiply volume gradually & stick to it for 60days.
take a break, if you are too occupied.It is enough to see the facts.
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