Backtesting is one thing, but when you’re in an actual trade and it’s going well for you, that’s when emotions start to mess with your head.
I just did a trade which went well right at the start, but instead of holding it till my intended 2x profit target, I got scared and cashed everything out midway through.
It eventually went on to hit the 2x profit target.
I got scared because I saw my real-time gains fluctuating wildly with every second.
Sometimes I’m up by a lot, sometimes I’m up by only a little.
My biggest fear is for a major reversal to take place, for the price to suddenly hit my stop-loss, and for all my theoretical gains to be completely wiped out.
I didn’t have the faith to hold it right till my intended profit target, which worked so well for me on paper in my backtesting.
In other words, I can be fairly confident that the trade I got into would more often than not hit my 2x profit target, but I just got scared midway through and decided it was better to cash out some profits than have none.
This is something I have to work on – managing my emotions during a trade.
To have faith to see it through right till the end.
To have confidence in the results of my backtesting.
It’s a long road ahead. I still have plenty to learn.