Learn from Your Trading Mistakes

By | March 1, 2017 3:30 pm

When trading the markets, most of traders are Wrong than being right. Most of professional trades i have met have a success ratio of 50-55%, ie. They are wrong almost half of the time.  There are many ways to be wrong.

  1. You Analysis using the Technical tools goes awry, Market is overbought and showing negative divergence and you short the market but it continue its rally.
  2. Market is trading near breakout you went long in anticipation of breakout but market went against you
  3. You get involved in revenge trading
  4. You did over trading after making a good trade thinking I can make more and more eventually losing out all your gains.

As Humans we are taught from starting you will be rewarded if you are “RIGHT”. Most of new traders come in market with the same thought process , Need to be Right and when SL is triggered they are unable to exit trade as they cannot be wrong. This natural, human tendency is so powerful that novice traders engage in unproductive trading behaviors to avoid admitting that they are wrong. They might hold on to a losing trade, as they cannot we wrong.

To trade like a master, it is vital to stay calm, open, and ready to trade with a winning edge.


Most of New Traders  have trouble admitting they are wrong. It can be difficult to admit we are wrong. It hurts our EGO. We tend to place great psychological significance on negative feedback. For example, when we are wrong, it is as if parents or teachers are criticizing us for doing something morally wrong. But this is a false assumption. When we are wrong, or make a mistake, we are not doing anything morally wrong. We are just being human. We all make mistakes, and it is vital to take setbacks in stride. If you can learn to downplay the emotional significance of being wrong, you will feel calmer and can trade more freely.

Need to be perfect– Most of traders want to be prefect in each and every trader they are taking. We often assume that unless we are always right, we will not be successful. This is especially true when trading.But we don’t always need to be right. If you make small practice trades, for example, you can make a trade, learn from your mistakes, and make a new trade. Over time, you’ll hone your trading skills. Since risk is managed, you can make mistakes and learn from them. There’s nothing to fear.

There’s no reason to kick yourself for making a mistake. You’re human. You are allowed to be wrong. Don’t be afraid to accept your limitations. If you allow yourself to be wrong, you will allow yourself to trade more freely, and over time, you’ll hone your trading skills to the point that you will trade the markets skillfully and profitably.

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