The moment someone decides to enter into the world of trading I’d say most spend the majority of their preparation anticipating the moment they place the “First Trade”
My two cents…
Every trade is your first trade…
As Mark Douglas put it, every moment is unique in the market. You can’t assume that your first trade will determine the rest of the trades. You simply won’t trade the same.
But what is the problem with preparing too much for a trade?
I have been noticing that most will say that you must do your research, prepare for everything, all that jazz.
Frankly, too much focus on “Preparing” is going to cause an issue of confidence in some traders.
Consider this, you are watching a chart and waiting for a pattern to form, you are anticipating your entry and you keep cross-checking your “research”
Is everything setting up?
Is there anything happening Economically (news) that may steer the trend of course?
Should I change my lot size/entry?
You get the idea…
The problem is, some patterns can take a while to form, during their development phase, you are reasserting to yourself that your “analysis” is on top, you are excited for the move to happen as you are going to make a killing….
Then, out of nowhere…
It simply breaks down, your pattern is now void.
You then start thinking, did I miss something? what did I do wrong? What could I change?
Reading this, if you have been trading for a while, you will understand that this happens, all the time, but for new traders, this can be a crushing experience, all relative to how they translate the fact their analysis didn’t play out.
The industry itself, and even in life, I mean the old saying goes, fail to prepare, prepare to fail. ( Which is bulshit)
What new traders need to prepare themselves for is awareness.
The only thing you need to be aware of is how much money you are going to lose if you are wrong…
TAKE THE TRADE.
How can you prepare for something (outcome) that you have no idea what the result will be?
What you can do Is say if “A” happens, then I will do “B”. All the while, the only thing you need to be paying attention to is…How will my capital be affected.
That is all you need to prepare for.
Prepare for the moment your capital is at risk…How will you respond if things do not go your way.
In my opinion, wasting time trying to become a hero for the most accurate way to place a trade based on your analysis, is where the problem is.
New traders need to overcome hesitation, they need to accept probabilities, then need to protect their capital.
This is all you need to be aware of.
Trade well guys.