Hi @FollowMyForex traders,
Earlier this week I was reading about how managers at some hedge funds were
removing their money from the markets because they just didn't know how to read
the markets right now. It said, "even the big boys are getting slaughtered".
Currently, we are experiencing a confused market if there ever was one. Just
take a look at the current H1 move on the
USDJPY
. A
60 pip drop followed by a 60 pip rise isn't any way you'd see the market move
in recent history.
We've been seeing this up-down whipsawing the whole week. Some big traders have
been taking shots this month like never before in their careers. I even know of
two who have reached their maximum drawdown and is going to take a break from
trading for 7 days now. Ouch!
It's in times like these that the most important aspect of trading becomes
clear again - risk management.
It's easy to forget about it when it's raining pips like during the period from
the end of February until end of April, but it's a bad habit to get into,
whether it's going good or not.
Why?
Because you never know when an unpredictable change in the fundamental
way the market is trading is going to happen and hit your account
hard.
If you got out of trades when you saw markets were behaving erratically - good
for you.
If you maintained strict management and never risked more than you should to
recover from a loss - good for you.
If you are ending the week anywhere between profitable and 1% - 2% down - GOOD
FOR YOU. You were practising diligent money management.
Thanks to everyone who traded with us this week and congrats on the winning
trades!
Trade safe and have a great weekend.
♦ P.S. Dear reader, if you liked this post, I would greatly appreciate a
thumbs up! And if you want more commentaries like this, trade ideas and
signals, remember to follow me. Thanks!
Earlier this week I was reading about how managers at some hedge funds were
removing their money from the markets because they just didn't know how to read
the markets right now. It said, "even the big boys are getting slaughtered".
Currently, we are experiencing a confused market if there ever was one. Just
take a look at the current H1 move on the
USDJPY
. A 60 pip drop followed by a 60 pip rise isn't any way you'd see the market move
in recent history.
We've been seeing this up-down whipsawing the whole week. Some big traders have
been taking shots this month like never before in their careers. I even know of
two who have reached their maximum drawdown and is going to take a break from
trading for 7 days now. Ouch!
It's in times like these that the most important aspect of trading becomes
clear again - risk management.
It's easy to forget about it when it's raining pips like during the period from
the end of February until end of April, but it's a bad habit to get into,
whether it's going good or not.
Why?
Because you never know when an unpredictable change in the fundamental
way the market is trading is going to happen and hit your account
hard.
If you got out of trades when you saw markets were behaving erratically - good
for you.
If you maintained strict management and never risked more than you should to
recover from a loss - good for you.
If you are ending the week anywhere between profitable and 1% - 2% down - GOOD
FOR YOU. You were practising diligent money management.
Thanks to everyone who traded with us this week and congrats on the winning
trades!
Trade safe and have a great weekend.
♦ P.S. Dear reader, if you liked this post, I would greatly appreciate a
thumbs up! And if you want more commentaries like this, trade ideas and
signals, remember to follow me. Thanks!