WHy do losses appear quicker?

[Billy Gates]

I have had this bugging me for ages and I thought there may be something else other than what little i already know. I can enter a position and wait hour for it to show a decent profit, on the other hand if i neter a wrong trade, it seems as if all the profit i had made in a big move, goes into the much greater into the negative over a fairly small move.

Am i missing something?

 

[Barramundi]

What instrument are you trading? Two things come to mind.
You will have to overcome the spread before a position goes into profit, as the position starts in the negative.
If you're trading forex, the pip value varies from pair to pair, so you may be losing on pairs with a higher pip value.

 

[nunrgguy]

How do you trade?

 

[glyder]

It may be that for the slow profitable trades you are entering a trade at a S/R level before seeing a firm sign of direction. Price then dithers for a while before finding direction in your favour.
For the fast losses, maybe the trades are in between Support & resistance levels, and just happen to go against you (as is often the way !).

Maybe.

 

[China Diapers]

If you are long futures or stocks, I guess at the first sign of trouble people are very quick to sell, whereas the buying needed to make gains takes longer to work its magic. That’s been my experience anyway.

Forex is another story, possibly.

 

[Billy Gates]

I will try to capture a screenshot of the two different scenarios.

 

[scose-no-doubt]

well why not flip your method on it's head

 

[BeginnerJoe]

You make a loss immediately entering a trade, then it hangs around until a profit shows. So most of your time is spent starring at a loss.

 

[Mr. Charts]

You make a loss immediately entering a trade, then it hangs around until a profit shows. So most of your time is spent starring at a loss.

Totally untrue, in fact the very opposite if you trade using momentum.

 

[BeginnerJoe]

Totally untrue, in fact the very opposite if you trade using momentum.

Why, does your momentum trade overcomes the spread immediately ?

 

[Mr. Charts]

Almost always.

 

[amit1986]

Why, does your momentum trade overcomes the spread immediately ?

Spreads with most trade-able stocks are usually 1-2 cents, so it doesn't matter much.

 

[BeginnerJoe]

Almost always.

For that kind of momentum, how do you get in on it quick enough ? You have it on automatic ?

 

[Barramundi]

I think we're getting off track here with the momentum thing. They said 'it seems as if all the profit i had made in a big move, goes into the much greater into the negative over a fairly small move.'

Time wasn't brought up, only size of move. Therefore, the issue must be with spread, pip value or trading volume, or any combination of these.

 

[enragedcow]

i think we need to shine the "Ross signal"

 

[nunrgguy]

Time is an issue, amount of pips/ticks you can capture is correlated to time as is range, although not in a linear way, especially if you're swing/position trading. If you enter trades after momentum, where by definition, at point of entry price is going against, as it is for any retracement trader then, depending on how you define how a trade is going against you, losing trades show up much much quicker than winning ones. It's a different mindset. Be small when you are wrong and larger when you are right to paraphrase someone.


Cr@p:cheesy::cheesy::cheesy: I'm starting to sound like someone else with verbal diorreah (sp)

 

[safvan]

I seem to have almost lost money all the time with more losses when I was trading daily. Any profitable trades I have made so far in my pursuit of excellence has always been when I have kept something for a month or more, preferably up to 6 months or more depending upon the length of the trend. Granted the account increases at a small rate and its really crappy if you have to build an account from a small amount. I do not consider myself as smart as many others on this forum day trading but my simple approach seems to be more on the side of my comfort level. Many competent day traders out there too. I cannot day trade simply because I do not have the mental capacity and more importantly the will for it.

 

[Mr. Charts]

Time was brought up - "I can enter a position and wait hour for it to show a decent profit... ",
not to mention "quicker" in the title.

 

[Barramundi]

Time was brought up - "I can enter a position and wait hour for it to show a decent profit... ",
not to mention "quicker" in the title.

Acknowledged. Look I could be wrong but I don't believe time was the key issue from what was stated. I think the statement 'seems as if all the profit I had made in a big move, goes into the much greater into the negative over a fairly small move' indicates the issue is with some combination of pip value, spread and lot size. I read 'quicker' in the title as also being a consequence of the above issues than necessarily a time thing.

But until Billy hits Shift -> Prt Sc and provides us with a couple of images then it's all going to be speculation............

 

[Ambrose Ackroyd]

Totally untrue, in fact the very opposite if you trade using momentum.

I guess I use momentum to trade.

I have developed my own method for measuring the rate of change of the trend and I have a pre-defined level of rate of change which attempts to identify the tipping point.

When I reach the required rate of trend change I enter the market ( hopefully at the tipping point ) and if I get it right then the trade takes me to my TP level very quickly and without any fuss.

If I get it wrong I don't waste much time in getting out.

I just can't bear the thought of sitting for an hour and watching it bob up and down and go nowhere.