The silver lesson: Patience in trading

Hi all. As I said to my Skype followers (add me to Skype, we have a trading room there, my username is on the right column) this friday has been wonderful for my trades that gone almost all in the profit area. I was holding some of them since more than a week and because I feel the fear of being wrong too sometimes I decided to share the lesson the market gave me yesterday to help you becoming a better trader.
This is the trade I entered on 12th January. I uploaded a comprehensible image full of explanations to make you understand the analysis that there was behind it.

My trade was a little too early as I said in my previous post here but while day by day                                     the market was confirming the right of my analysis, the time was making me nervous because after a week everyday I’ve only seen the price almost touching my sl, going in profit area during the day and than closing lower in the evening.
I was very worried and on 19th January after a week of nothing I was almost going to close my position to break-even. When this doubts comes out I decide always to make something to be inattentive like walking out with or without my dog, jogging, biking and things like that. Everything I can do outside is good. When I returned I said to myself: You made your analysis, you put the SL there and the price didn’t touch it so your stop loss placement was good and your entry and target was good. Is something changed in this week to make you believe you made a wrong choice? The logical answer was NO. Everything happened instead during the week was only confirming my trade. SL not hit, Ema crossed and started to diverge and act as support but my mind was saying maybe you are wrong… You can lose money.
This is real! Losing is the obvious part of trading. Everyone lose money in trading but the important thing is having a plan, follow it and be consistent.

After this long preface I return on topic which was the patience lesson. Why is patience so important in trading? It is determinant in every part of the trade and before it, let’s see why.

1.  You must be patient to wait for the price to reach the right buying or selling area. For the traders like me it means waiting for weeks sometimes and get really bored (start understanding that trading IS boring).
2. When price reach the right area you can also don’t get any signal at all and continue waiting patiently for the next area to be reached, again BE PATIENT.
3. Ok, you’ve been lucky. You waited a lot but now you see the PERFECT TRADE, everything says that you can’t be wrong about it, set your limit order or enter directly at market, put your SL and your target diligently confident that the day after your patience will be rewarded with a profit 🙂
4. But the market is there to getting you nervous (or maybe losing money make the people nervous) so the price start zigzagging around your entry price, it can happen also for a whole week like it happened to me on silver and here the good virtue of traders comes out again. Give your trade time to develop and never make your fear overcome your brain.

The fear is in fact the enemy of the patience. You can see it in the three categories of fear that are linked with what we said above.

1. The fear to miss a trade (when you don’t wait for the right entry but get in earlier)
2. The fear to be wrong (when the trades doesn’t go in the right direction)
3. The fear to lose (when you stop trading the most obvious signal because you’ve got a row of losses)

You can do it in different ways. The first is always build confidence in your trading plan and on yourself by trading with small positions. Don’t demo account! To my experience, trading demo is almost like playing for the most. It’s not so easy to take the things seriously when you in the end don’t lose nothing so better to trade with small sums of money than without them. When you get a row of losses try to clear your mind. You know you have an edge on the market (I’ll discuss this in the next lessons) and you’ll end making money instead of losing it.

I hope you’ll appreciate this new lesson and as always leaving a comment will be great. If you liked it share it too with Facebook or Twitter using the buttons down here.

Have a great weekend!