Yesterday, I wrote to you and talked about our AMC trade.

Alongside me, members of the Warlock’s Worldtook an earnings reversal and made some quick money in the morning.

And I highlighted exactly why with our trades we get in, we make our money, and then we get out.

I had my day set from our early AMC trade, got my money, and should have walked away.

I SHOULD have put my feet up, closed my computer, and relaxed for the rest of the day.

I made my day’s pay after all, why was I sticking around?

I’ll tell you why in one word: greed.

I was greedy.

I was thinking “oh AMC worked so well, why don’t I put a couple more trades on and make even MORE money?”

Well guess what…

The next trade was a loser.

And at that, point I was absolutely supposed to walk away. I nibbled a little bit trying to buy into a VWAP break that didn’t pan out all the way.

So, I had a loser now. And my rule is if I have made my day’s pay, and then I put on a trade that loses, I walk away.

My issue is that after I had my first loser of the day, I didn’t walk away.

I stuck around like the nudnick I am, and tried to get revenge on the market.

This is where it got dangerous.

Revenge trading… trading on tilt… whatever you want to call it, is a one-way ticket to blowing up your account.

And blow it up did I ever.

I turned a winning day into a loser, and by the end I was in the negatives.

The reason this is such a dangerous thing to do is in the nature of trading itself.

It’s a mental game. And if you aren’t thinking clearly, you’re just betting money at the casino, watching your hard-earned cash disappear.

I took a trade that worked — earnings reversals on VWAP breaks — and threw it out the window for some speculative scalping.

I tried to save the loser trade and put on more and more losers that compounded into a big fat loser of a day for me.

So, there’s really two things to take out of this.

First, stick to what works. VWAP breaks on earnings reports works for me, so that’s what I’m going to trade.

If trading the Q’s works for you, do that. If you like trading small biotech stocks in the pre-market, then do that.

Just use the VWAP as your guide, and keep doing the same trade over and over and make your cash.

Stick to your rules too. If you have a rule of 3 losses in a row and you’re done, stick to that. If you have a rule of one loss and you’re done, stick to that.

Don’t blow up your day like I did yesterday.

Secondly, and this is very important, don’t let yesterday’s trading day define today.

Go into every day with a clear head, and crush the markets.

The past is the past. You can’t change it.

What you CAN do is tackle every trading day like it’s a new day. Start with a blank slate and crush it out there.

We did that today in the Warlock’s World so if you didn’t do that today, I would highly suggest you join us today.


Leave a Reply

Your email address will not be published.