Ouch…. 200 pips of invisible profits

On Thursday, I sent you my latest post with a USDJPY Trade Call Here: http://www.learntotradeforprofit.com/usdjpy-setup-happening-now/

Here’s what happened immediately after I posted it:

usd_sky_rocket

 

So I am a little bummed out to report that price didn’t come quite low enough to get into our entry zone before sky-rocketing 220 pips which means I missed every bit of it… OUCH.

But this is a really important lesson in trading, so I just wanted to take a quick minute (and thanks for your time) to mention this…

One of the EASIEST things to do in trading is get hung up on missed opportunities.

Whether it is something like this where you JUST missed a big opportunity, a news trade that is going crazy and you know massive potential is there but you’re not in the market, or a trade you closed out of that then continued way, way further in your direction and you took a 1% profit where you could have had a massive 5% profit.

These are all scenarios that I have seen cause traders to lose composure.

The most common mistake is jumping into a position for fear of missing out. And I am begging you not to do that.

Sure, watching the USD/JPY go up and up without me is tough. 210 pips could be over 4 grand in my pocket right now with a 2 lot trade…

BUT, there are two things you must remember…

     1. There will ALWAYS, ALWAYS, ALWAYS be another opportunity.

It is the beauty of investing. There is literally never a time where opportunities don’t abound. Every minute of every day there is opportunity and it is up to us to find it. It is never worth it to chase an opportunity that’s already gone and risk heavy losses from that greed.

     2. You never know when that chance is not what it seemed

Trading in hindsight is easy. Almost everyone does it (including me). “Oh, if I would have got in there I could have got out and made X amount money! Arghhh!” The truth is that things rarely would have turned out how we view in hindsight. For all I know, I would have gotten in on the USDJPY and got spooked by a 15m reversal candle for a break-even gain rather than the 200 pips I am supposedly missing out on.

Even more so, the 200 pips running away hurts. But for all I know, it is scooping up buyers just to crush them and reverse back down to my levels after all for an even better opportunity and a 500 pip slingshot move. If you want to dwell on opportunities, dwell on the next one, not the missed one. You never know what’s around the corner.

This took a long time for me to learn and a lot of money too.

One of the hardest things as an investor is to let go of missed opportunities. It is so easy to count in your head what could have been.

That is why is SO important to have plans and rules.

The USDJPY did not come into my buy zone therefore I didn’t buy it. I am not going to pretend that it is not a little painful to watch it go up 200+ pips very close to that zone, but there was nothing I could do. It didn’t meet the criteria. I didn’t make a mistake.

In truth, it was impossible for me to make money on that trade without breaking my rules so it’s actually a great thing I am sitting here without that 4 grand of profit in my account. Because following my rules will make me exponentially more money in the long run than getting lucky on one bad decision.

Just my two cents for the day. Hope it helps.

-J

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