time: The single most overlooked factor in trading. But time is probably the most important factor in determining whether a trade will ultimately win or lose. Even if you lost and exited the trade after 2 hours, you could have ended up being a big winner if you had held it for 2 weeks. We humans are certainly the weakest when it comes to trading. Because most of us have very little patience, self-control, and self-control, especially when it comes to holding deals.
Nearly all of the best trades I’ve personally made or seen members make have taken far more time to execute than any of us originally expected, or perhaps even hoped. took a long time. But the reality is that what we want and expect to happen is usually not what the market has in store.
The foundation of successful trading almost always consists of staying in the trade for longer than you would like. Just let them act without your intervention and just accept that the market and prices take time to get along. You’ll see that for yourself later when you look at the charts. Now let’s take a look and count how many days, weeks, or months it took for the most obvious trading signals to unfold.
The whole logic of holding trades longer than you think is that traders use daily chart timeframes and wide stop losses to avoid being stopped out prematurely by short-term market noise. It comes from my belief that it should. Today’s lesson will explain why you should start holding trades longer if you want to be successful in long term trading.
How To Significantly Improve Your Trading Results This Year
New Year is approaching. One of his New Year’s trading resolutions is that he wants to improve his trading results. This may seem easier said than done, but the most important things you can do to improve your trading this year are: Hold trades longer and don’t intervene or watch too much.
In this lesson, we’ll look at some daily chart trade setups and show how considering not only price but time can greatly improve trading results. You should start showing the time as important as seeing the price of the current trade. For example, just because a trade is currently negative (but hasn’t hit your stop loss) doesn’t mean it will end up in a loss. , due to time. Time is your friend in the market, but time is your enemy for most traders.
If you trade on the daily chart timeframe, I would say the average period to hold a trade is around 1-3 weeks. I think most people reading this rarely stay in a trade that long. Now, this isn’t meant to be offensive, it’s meant to be an eye-opener and a piece of helpful wisdom. Let’s see some examples on the chart…
In the daily gold chart below, we see some very good pinbar signals formed at key support levels. You can see the price of the first pinbar saw going up pretty fast, but if you want to make a big profit, even that pin took a full six days to run. The next pin a few weeks later his bar regeneration took even longer. Note that it took about 17 days before I actually got a big profit. Could you wait that long for a 50% tweak entry and subsequent price increase? It’s all about making a plan and doing it.
Now let’s look at another chart. This time, of course, it’s WTI crude oil on the daily chart timeframe. This trade setup has formed during a very strong downtrend. He had two bearish pinbars and although small in size, he had a large trend weight behind him, so he had no problem getting a signal. However, after going short, we see that the market decided to consolidate and moved sideways for a full seven days before finally being able to turn down again and make a profit. Sadly, most traders would have been completely confused in those 7 days, turning big winners into multiple losing trades.
Use wider stop loss and stop intervening in trades
You have the tools on your side to help give your trades the time they need to become big winners.That tool is the Stop Loss Placement, more specifically, Consider using a wider stop loss than what you are used to. Giving a trade an extra 50 pips or so greatly improves the chances of that trade turning from a loser to a winner. The reason is probably that many trades are (or should be) taken at support or resistance levels after an intra-trend pullback, but we cannot predict exactly how far the market will retrace. . So giving that trade a little more ‘padding’ or room near the pullback area can often avoid stop-outs.
Increasing the distance of your stop loss naturally increases the amount of time you need to hold the trade (at least that’s your goal) because you’re placing your stops outside the average daily and weekly price movement range. For example, EURUSD moves 150-200 pips per week on average, so if your target width is 400 or 600 pips, you have to wait and there is no way around it.
But keep in mind that the wider the stop, the longer you stay in the game and the better your chances of success in a series of trades. That’s the goal, right?
An example is shown below. The daily crude chart below shows two very good daily bullish pinbars that have formed. Price then crawled sideways for a few days, barely breaking the lows of the pin, before rising further with a slingshot. What a cruel fact that most of the traders who entered far away from these pins stopped out with a loss on the bar lows just before the price surged. solution? Turn your losses into wins by increasing your stopping distance. Don’t be greedy about choosing tighter stops just to increase your position size. Keep in mind that bulls and bears are lucrative, but pigs are slaughtered at the market. Are you a bull, a bear or a pig?
This is another classic example of how perseverance with wide stops and giving your trades time can yield huge profits…
This time we are looking at the daily chart of NZDUSD and we see a very clear and obvious bearish pinbar sell signal forming around the resistance level. The most important thing here is the overhead critical resistance level. Instead of setting the pinbar high, you should set your stop loss just above that level. Literally, it’s the difference between losing and winning. If you enter the trade with a 50% fine adjustment, notice if the entry price then rises by a small amount, just above the pin high (but stays below the resistance level) before selling. He had to wait 20 days to get a big profit, but if he just set up this deal and forgot about it, he would literally be doing nothing while making money. Don’t make it any harder than necessary.
Patience and discipline – do you have them?
Of course, the ‘glue’ that enables all this ‘waiting’ and ‘doing nothing’ is patience and discipline, two things that many of us miss in an era of ‘I want it now’ mentality. It’s something I’m struggling with. Only when traders choose to stick to their plans and not go astray in the face of temptation can well-executed trades yield monster returns.
In my experience, even the most obvious trades that go right in your direction take about a week, sometimes longer, to actually turn into big wins. A good example is this setup from his AUDUSD daily chart earlier this year. The overall trend has fallen and the price has returned to key resistance areas, forming a very clear bearish pinbar sell signal. The price fell the next day, but many traders probably settled for a small profit on that one day alone and made a bigger profit instead of holding for six days and waiting for the price to reach the next support area. could have gotten…
Conclusion
What I want you to learn from this lesson is that you need to start thinking about time as an important factor in successful trading, not just an afterthought. Every time you enter a trade, you should be prepared to give yourself the space and time you need to become a potential winner. Otherwise, you will suffer many unnecessary losses.
Don’t try to make money in a hurry. This is just greed, and as you know, greedy people end up losing money in the market. He should not get too attached to his trades and dealings. The main ways to do this are to manage your risk and not overuse your trading account’s leverage, but it’s also important not to trade too quickly.
Traders who make money and enter the infamous 10% of successful traders are those who are brave enough to trade and who have the patience to be unfazed by every small fluctuation in the market. Instead of being reactive like wild animals, we want to be skilled and patient like intelligent humans who use their frontal lobes to control their impulses.
If you want to learn more about how I trade with a simple price action pattern like today’s lesson and how to manage my emotions and money in the market see my newly updated price Check out our Action Trading Course to learn more. and training.
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