It’s simply amazing

February 17, 2009 in Uncategorized

When you have 3 wins out of 10, it’s a lousy strategy. What if you have 10 losses out of 10?

I’m simply amazed by how some days I can get 3 straight wins and how some days I can get 5 straight losses.

When you have a losing trade, what’s the first thing that comes into your mind? That it doesn’t work? Or is your entry too late? Too early?

I have been thinking about this for quite awhile. I used to have this idea that if I had 10 straight losses, I must be doing something right, but just missed out something. I must be putting the right trades, but in the wrong direction?

Have you ever see it this way? If you have 10 straight losses, all you need to do is to trade opposite of yourself and you will have 10 straight wins?

I bet this is how floor traders operate. I remember reading article from Sam Seiden of OTA telling the story of his first days on the floor. He had a mentor back then who was an experienced floor trader. He told Sam to look out for that new guy opposite the pit: if he made a move, let him know. So Sam watched closely and soon enough, that new guy put a buy order. Sam alerted his mentor and he took that trade. Shortly, that new guy was in the red and Sam’s mentor closed him again.

It was how simple money was made in the pits: Just take the opposite side of the novice trader, because he’s the one who will be losing 7 out of 10 times. All you need to do is take his opposite trade.

So whenever you are in a losing streak, tell yourself this: “If I took the opposite of all my trades, wouldn’t I be winning?”