The Bouncing Zone Strategy — Part 1

Introduction

Your are about to read the part 1 of a 3 part article called "the bouncing zone strategy".

You should know that I haven't invented this strategy. I've learned it on the internet and with friends, and then tweaked it to feet my needs. Some people call this strategy "supply and demand levels", but I think "bouncing zones" better describe what it's about.

The setup

This is a strategy based on Price Action, so the setup is quite simple: just the price in candle sticks. No indicator at all. I trade mostly on the main pairs (EUR/USD, GBP/USD, etc.), and on a 1h timeframe (TF). But this technique should work on any pair and any TF.

The basic idea

Sometimes we see price moving very rapidly in one direction. What does it mean? Let's use an example to make things simple:

• Some people are selling a huge amount of $currency, and these "some people" are usually big banks
• That makes the price drop quickly from 1.3 to 1.2
• It means that a lot of people who wanted to sell $currency at around 1.3 couldn't do so, since price moved so fast
• So next time the price goes back around 1.3, a lot of sell orders are going to be triggered, and price is going to move down again
• Of course it works the opposite if price increased from 1.2 to 1.3

Once you realise that, you just have to use this information at your advantage. Here's a EUR/USD chart that shows this.

Legend:

• 1) Price dropped quickly from here, we call this a zone
• 2) Then when the price reaches back the same zone, the price bounce

Now you should understand why we call this strategy "bouncing zones". The zones from where price move quickly in one direction are called:

• Demand zone, when people want to buy and price will increase
• Supply zone, when people want to sell and price will go down (like in the example chart above)

So you just have to identify these supply and demand zones, place orders when the price goes back into these zones, and wait for the price to bounce. Obviously not all zones are going to work as planned. But from my experience, enough are going to work in our favor to make this system work, and make money.

How to identify bouncing zones

Identifying zones is quite easy. All it takes is two steps:

• 1) On a chart, identify all strong price movement
• 2) Find the base of the price movement, where the price moves slowly in sideways. This is what we call a zone.

In the example below we see 3 strong price movement. There is a supply zone that already worked, and a new demand zone.

You can see that it's quite easy to do!

How to precisely draw zones

This part is hard to explain precisely, cause there may be some rules to follow, but your also need some kind of instinct, that you can only learn by doing. Drawing zones is an "art". Anyway, the basic idea is this:

• Look at the base of a strong price movement to find some candles moving sideways
• Make the zone cover all of these candles (body and shadows)
• Then refine your zone:
  • If it's a supply zone, you do not care about the lower shadows of the candles
  • If it's a demand zone, you do not care about the upper shadows of the candles

Here are a few examples of zone drawing:

Legend:

• In blue + orange: the whole zone that covers all the candles
• In orange: the shadows we're not interested in, as explained above
• In blue: the refined zone to use for the trade

Entry, stop loss and take profit

Once you identify a zone that you want to trade, you have to set up the trade. Here's how I do it with a little example.

Legend:

• Blue rectangle: the supply zone
• Blue line: the entry of the trade, at the beginning of the zone
• Red line: the stop loss (SL), usually 2-3 pipes above the end of the zone
• Green line: the take profit (TP), that is simply placed in a way to have a 1:2 or 1:3 risk:reward ratio (in this example it's a 1:3)

So once you know how to draw zones, setting up trades is really simple with these rules.

Examples of bouncing zones

Below are 4 examples of bouncing zones from CHF/JPY charts. Two are demand zones (top), and two are supply zones (bottom).

You should try to find zones on your own charts, and see the price bouncing into them

Credit: 21pips

How to Trade Forex with Ichimoku: The Cloud

Howdy! Forex traders. It’s me again! Though I have been quiet lately, I know that I still have a lot of guides to create for you. I have been busy with life lately, and my positions on the market has been for the longer term (daily, weekly and monthly positions) so I decided not to post about my forex trades until I finished this another guide for ichimoku. But enough about me and lets talk more about the ichimoku indicator.

The Ichimoku cloud is the most noticeable piece of indicator in the Ichimoku chart. The idea behind the ichimoku cloud is that it is the resistance that we should be most aware of. It also tells us where the bias of the trend is and where it is heading.

How Clouds Are Formed?

Ichimoku clouds are formed because of the senkou span lines A and B. When A is above B, it is bullish. When B is above A, it is bearish.

How to Interpret the Ichimoku Cloud

Think of the ichimoku cloud as resistance lines. Only that they are lines with big bodies that vary at different points in time. The larger the body, the greater the resistance. The thinner is the cloud, the easier it is for the price action to break it because it represents a weaker resistance.

On our last post about the 3 lines of ichimoku, we said that the kijun lines is the heavy weight when it comes to the resistance. But the last resistance that the price must break is the cloud. If it wishes to reverse. In other words, the ichimoku cloud is the last resistance for a confirmation of a reversal. It it didn’t bounce back to the normal trend after hitting the cloud, then its probably going to reverse.

Things to remember about the ichimoku cloud

• When the price action is above the cloud, it is a bullish bias
• When the price action is below the cloud, it is a bearish bias
• When the price action is INSIDE the cloud, it is consolidating
• A cloud with a flat line is a strong resistance. The flat line is the resistance line.
• A cloud with a huge body is a strong resistance
• A cloud with a thinner body is a weak resistance

The Future Cloud

The ichimoku cloud or kumo has this idea of “future”. Consider this image.

Look at the last price action. The kumo cloud just below the last price action (yellow cloud) represents the latest price action. But looking a further to the right, there is a green cloud that looks somewhat incomplete. That is the future kumo or future cloud. It tries to predict what the next bias will be and will also try to give you a signal if there is a strong resistance is forming.

The future cloud is very important in giving us the first sign of reversal. I also look at the future cloud for the same reason and to be aware of strong resistance cloud forming. When the cloud changes in color, you are the first to know if the trend is weakening and you can decide on this information.

Conclusion

There’s a lot to take in, when you combine all the lines and the cloud altogether. And this is a good thing. Because the beauty of ichimoku indicator is that, because there are a lot of indicators for it, the lines and the kumo, you can craft a trading strategy that fits only for you. Without deviating from the core that makes it successful.

On the next post, I’ll teach you how you can combine all these indicators to create a trading strategy. And I will teach you the core trading strategy of this indicator that makes it successful.

(C) Forex Philippines

How to Trade Forex with Ichimoku: The 3 Major Lines

I think the best way to describe ichimoku is that its a trend following indicator that gives you a graphical picture of where the support and resistance lines are. Contrary to most trading system, support and resistance lines are not a straight line in ichimoku. They vary depending where the price is going.

The benefit of this kind of thinking that support and resistance lines are not flat lines is that, it prepares us to expect nothing of a breakout because that breakout point may disappear since the support and resistance lines in ichimoku is not a flat line.

The 3 major lines in ichimoku and sometimes called the ABC lines are:

• Tenkan Sen Line (dark blue)
• Kijun Sen Line (red)
• Chikou Span (teal)

Referring to our old diagram:

Tenkan Sen

The tenkan sen line can be thought of as a light resistance. A trend may hit the tenkan sen lines a couple of times and break. It can also serve as an entry point for traders who wants to get in on the trend after a small retrace.

Direction

The tenkan sen can also be an indicator of trend direction, when the price is trending, or it is about to trend, the tenkan sen will point to the direction of the coming trend or prevailing trend. In other words, it points up if it wants to trend up and down if it wants to trend down. If flat, there’s a consolidation and the trend may reverse. Keep in mind that I said earlier that the tenkan sen is a light resistance. And it is true for the trend it indicates. The trend may be weak when indicated by tenkan sen. It is the short term indication of the trend and the light weight of support and resistance.

Kijun Sen

When Tenkan sen is the lightweight, kijun sen is the heavyweight. When price reaches for the kijun sen, its a strong support and resistance. And breaking the kijun sen will result in a reversal of the trend most of the times. A false break out of the kijun sen will result in a strong continuation of the trend.

The proper use of kijun sen is for entry. When price reaches for the kijun sen, its a good probability to add position or enter the trade. That is, if you’re a trend follower. For the contrarian, its a good position to bet on the other side of the trend.

Direction

The Kijun sen also points up, down and flat. Same thing as the tenkan sen lines. But keep in mind that the kijun sen is a heavy weight and the indication is that the trend will continue for med to long term.

Chikou Span

There are many description to define Chikou. Some traders I know ignore it altogether. But I think, Chikou is very important. It is the momentum of the trend.

The chikou also gives you the direction of the trend. When it points up, down and flat is the same with the kijun and tenkan sen lines. What’s unique about chikou is that it gives you another indication. Where it is placed on the chart has an impact.

When the chikou collides with the price action candle stick, it means, its consolidating.

When the chikou is below a price action candle stick, it means its bearish.

When chikou is above price action, its bullish.

When its inside a cloud (we will explain cloud in later posts), it is consolidating.

And when the chikou is free to roam, no cloud, no price action to collide with, then the trend is strong, and will probably last for a very very very long time.

The key to using these lines is to look at them all and how they behave. On the next post, we will discuss how all these 3 lines act together to give you a well informed representation of a good probability trade.

(c) ForexPhilippines

Trading Recommendation For Nov. 21

Technical Analysis

AUDUSD Llikely Forming a Head and Shoulder Pattern; Sell on Confirmed Breakdown!

Today we are going to take a look at AUDUSD, also known as the Aussie. Technically as we can see in the daily chart, a head and shoulder pattern has formed. Head and Shoulder patterns are bearish patterns where prices tried to make high's 3 times but failed to make new high's on the 3rd attempt.

To read the full trading recommendation, please click this link:http://metisetrade.com/index.php/research

Fundamental Analysis

Fed Minutes Show Tapering is Likely Under Way 

The Federal Reserve looks set to move sooner rather than later to taper back its bond buying, once more surprising markets that have been repeatedly confused about when the Fed will begin to step back from its extraordinary easing policy.

To read the full trading recommendation, please click this link:http://metisetrade.com/index.php/research

Life Hack !

Every bachelor frog needs his bachelor pad. Want all the perks of that high-end bachelor life, but can’t manage a budget higher than a roll of duct tape?  Want to improve your sense of style, but not in a way that will clash with your 15 taxidermied squirrels that you shot yourself?  Then these solutions will help you achieve that dirty, smelly, beer-stained good life.

Entertainment Center

The bachelor pad is all about having a good time, so there’s probably a significant portion of time that you are either entertaining the buds or ladies(maybe?).  Here are some ways to impress them without having to, you know, put in any actual effort.

Some guys have wine cellars, but you? You’re a far more economic type, you debonair, responsible stud.  Way to be.

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There may be one game, but there are a thousand ways to tailgate.  Why not make laundry day a day to celebrate?

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It goes without saying that the pad is NOTHING without the flat screen.

Gym Equipment

Hey, a redneck has to keep looking his best. Why use the phrase “pump some iron” when “pumping some buckets filled with cement like a construction worker gone rogue” sounds just as bad-ass?

The Business Room

We all know what room we’re really talking about.

Those fancy showerheads that simulate rain seem pretty pointless when you can design to your own tastes, and have that rain taste subtly like your alcoholic beverage of choice.

There’s that overused saying about “a man’s throne”.  This guy is the only one who has ever meant it.

But if you’re the one willing to splurge a little bit, there’s the luxury model (if the first one wasn’t enough luxury for you) If this is what Bed, Bath, and Beyond sold stuff like this, maybe I’d actually want to go in when my girlfriend asks.

On the chance that you consider your throne something else, well, there’s ways to make that happen too.  There’s little that can separate a man from his grill, and now there’s even one less thing.

Decorations

For your décor, add a little of yourself into the mix. Don’t be afraid to subtly integrate your hobbies.

Creative use of crates instantly makes an ordinary lightbulb into a beautiful disco hall of inspiration and wonder.  And they look kinda like legos.

Or for a classier option, this chandelier says, “I enjoy a low-cost booze cruise as much as the next gun-toting American, but if you haven’t noticed, I’m also a gentleman”.

Hopefully these examples give you some inspiration for your own disgusting cellar of debauchery. Because hey, living the good life ain’t easy.

(C) Zolo

How to Trade Forex with Ichimoku: Introduction

Ichimoku Kinko Hyo or Ichimoku for short, is a trend following indicator that has been created by a Japanese named Goichi Hosoda. He made a book about the indicator in 1968. But since the lack of translation to other languages, very few traders knew of its existence and for a long time, it has been treated as one of those “exotic” indicators that never really given the time to shine. Just until recently that this indicator proved to be very powerful.

Why Use Ichimoku?

Ichimoku has been used extensively to trade forex / currencies, commodities, futures and stocks. In other words, it can trade any market with no problem.

The word Ichimoku Kinko Hyo means “Equilibrium chart at a glance”, where the components of ichimoku works with each other that gives the trader a visual representation of the price action. A simple look at the chart with the ichimoku indicator will allow the trader to have an immediate understanding of sentiment, momentum and strength of trend.

5 Basic Components of Ichimoku

The ichimoku indicator has 5 basic components. A trader must know very well what each of these components do to maximize the power of this indicator. Each component is an indicator of its own and a lot of traders turn off the other components for preference. But if you really want to maximize its potential, I recommend to get to know each component and use all of them.

1. Tenkan Sen which means “Turning Line” takes 9 periods
2. Kijun Sen which means “Standard Line” takes 26 periods
3. Chikou Span which means “Lagging Line” takes 26 periods but time-shifted backwards.
4. Senkou Span A, first leading line, time-shifted forwards (into the future) 26 periods.
5. Senkou Span B, second leading line, for the past 52 periods time-shifted forwards (into the future) 26 periods.

I know what you’re thinking. You’re probably thinking this doesn’t make much sense. And I agree with you. The first time I knew about these periods and time shifting thing, I got confused. But trust me for now and it will all be clear later.

We need to memorize the periods so that when you get into a trading platform, you’ll be able to set your ichimoku indicator to default values.

That’s all for now, for the next lesson, we’ll go through each one of this components. If you have any questions, please feel free to comment below.

(C) ForexPhilippines

6 Ways to Get Yourself Motivated in Saving

Most students enter the real world when they reached the age of 20 or 21. That is when they enter the corporate race. This is also where the real challenge happens when it comes to saving money.

You’re not dependent anymore on your allowance from your parents. You now earn your own money. With that come different challenges to lure you not to save money. Social pressure from your friends to buy the latest gadgets just to be ‘in’ comes along your way. Officemates will be there to invite you too for gimmicks and parties.

You say to yourself that you earned that money and that you’re entitled to spend it in anyway you want. Some say they are entitled to reward themselves because they worked hard for it. Before you knew it, your salary goes directly to expenses leaving you with zero savings and perhaps credit card debts if you really cannot discipline yourself when it comes to saving money.

What should you do then in order to fight the urgency to spend? Here are some useful tips to resist spending away your hard-earned money.

Know your hourly rate in your job. Before you spend that hard-earned money from your job, calculate first how much you make on a per hour basis. Suppose you earn 18,000 a month as a fresh graduate and you work 8 hours a day, five times a week. In a week, you’re working for 40 hours and in one month, you’re working for 160 hours.

So your hourly rate from your job would be 18,000 divided by 160 leaving you Php 112.5 per hour.

Now before you buy stuffs, calculate first how many hours you worked for that money you’re going to spend. Are you thinking of buying a pair of shoes worth Php 3,000? Ask yourself first: Do you really want to work 26 hours just for that pair of shoes? Do you want to repeat the 26 hours of tiring labor, 26 hours of your boss shouting and bullying you, 26 hours of your back hurting sitting in front of that computer, and 26 hours talking to annoying colleagues for just one pair of shoes? Think about it carefully. Think twice, thrice or even four times.

Force your savings. True enough, it’s hard to save money especially if your will to do it is weak. Leave it to automation so you’ll be motivated to save!

Nowadays, you can now automate your savings by setting up a fixed amount to be deducted on your payroll account on a particular date every month. With the availability of UITF investments as the new form of trust funds of banks, you can enroll to their Regular Subscription Plan (RSP) for as little as Php 1,000 every month so that you are not only saving but also investing in your chosen UITF fund.

Make a savings goal and track it. Make a savings goal for yourself. Do you want to have 1M in savings before you reach 30? Then list down that savings goal! Listed goals are more achievable than unlisted ones.

Make an excel sheet tracking your savings developments on a monthly basis. Update it at the end of every month. You’ll get excited as you see the amounts increase every time you save especially as you get closer and closer to your savings goal.

Look for more ways to earn money for you. Do you have that unused item on your house? Then sell it by setting up a garage sale or post it on online classifieds like Sulit. Sell your services to your friends and colleagues. Think of more ways to earn and don’t forget to add the earnings of these to your savings goal. Your excitement grows more and more as you become closer to your goal.

Think of your health. Are you the type of person who needs exercise because you’re fat or are you worried about your health? Then try to save transportation costs by walking short distances. Instead of drinking sodas and juices in restaurants, drink water. Aside from additional sugar that will be added in to your body, you will just excrete it anyway through urine few hours after you leave the restaurant.

Don’t buy too much junk food in grocery stores. They are called such because they don’t provide much nutrients to your body. Avoid smoking, it won’t make you any good. It will just destroy your lungs and will cause you bad breath. Instead of thinking ways to spend your money, engage yourself in physical activities such as sports or your favorite hobby such as cooking or crafting.

There are many ways on how to save money by just thinking of your health. These little savings can pile up to make thousands when saved for a long time. A penny saved is always a penny earned. Truly, health is wealth.

Let the ‘Law of Attraction’ works. Do you have a goal of building your own dream house in the future? How about traveling to another country for vacation? Or perhaps buying your own car?

Place a picture of how you visualize these things in your wallet with the motivational words such as “I will achieve this” or “I will have this”. You can have the option to make it more specific by placing a time to it – “I will go to this place by December” or “I will achieve this by age 35”

Every time you spend money either by cash or credit cards, you’ll be reminded about these goals which will make you think twice before spending especially if it’s only a want.

Put a name on your bank accounts. Put a name on your bank accounts according to your specific goals. If you’re saving for a car, try to name it “Ride To a Brand New Vios” or if you’re planning to go abroad, try to name it “Enjoy Singapore Trip”. You’ll get more motivated to save for these savings goals.

It’s important to treat yourself occasionally to avoid getting frustrated and spending all your savings at once, so make sure you include a little “happy time” money in your budget to treat yourself every now and then.

Nowadays, with the influence of TV and media, everyone is encouraged to spend which makes saving more difficult. Saving money is hard and for some, it’s boring.

However, if you have that will and determination towards your goals in life, you will surely possess that self-discipline to save your hard-earned money and stick with your plans.

Credit: Tyrone Solee

An introduction to psychology in trading

A big mistake that beginners make when first learning to trade, is to assume that developing technical or fundamental analysis skills alone will allow them to become successful. In fact, learning to control emotions is the most important skill that allow a trader to become successful, because emotions have the biggest impact on your results.

The role of psychology in trading

Successful trading is not down to any single trade, but a number of trades using a strategy. This means that a trader must be disciplined enough to stick to their strategy, even throughout a losing streak. However, human beings often do not behave in a logical way and there are many times that emotions influence us and we act differently to normal.

A trading strategy's success is determined by a number of trades. A successful trader must stick to the rules of their strategy and not allow emotions to get in the way.

Do you remember the last time you were very angry? Maybe you did something and you were surprised by your actions. As much as you regretted it afterwards, at the time you probably couldn't help it and furthermore, you are likely to act the same way again if you become angry in the future.

This is because the psychology of a person is made up of thoughts and feelings that are an incitement to act, and so psychology shapes our behaviour in every aspect of our lives – trading is no exception.

Emotions are inevitable – especially for a new or unskilled trader and they can prevent you from making an objective decision. For this reason, learning how to control emotion becomes paramount to successful trading over and above everything else.

The zone

When a trader is thinking clearly and is uninfluenced by emotion, they are said to be in the zone.

When a trader is thinking clearly and uninfluenced by emotion, he is said to be in the zone. When you are in the zone, you are in control of your behaviour and are able to follow a trading strategy in a logical and systematic way.

Some traders find it easy to get into the zone, but even those who struggle can learn to control their behaviour and become emotionally detached from trading.

Tharp's chart and the importance of psychology

Dr. Van Tharp is known for breaking down the trading process into three categories that affect traders. He categorises them by importance as follows:

• Trading strategy (10%)
• Money management (30%)
• Psychology (60%)

According to Dr. Tharp, the psychological outlook and an individual’s way of thinking towards trading is the most important factor for success.

The fact that the actual trading strategy is ranked the least important by Dr. Tharp, suggests that regardless of how successful a strategy is, psychology is the key to being successful.

Emotions that influence trading

The emotions in trading that have a negative impact on results are greed and fear. These emotions cause a trader to deviate away from their plan, which can lead to further issues, such as ego and revenge trading.

The following are examples of these emotions and how they can negatively affect trading results.

Fear of losing can lead to further losses

Fear of taking losses can ultimately lead to even more losses. The typical behaviour of a trader will be to close trades early, either when the trade has temporarily gone into a loss or a small win, and not letting the trade run its full course

When a trader has a fear of losing, they try to avoid them. This can actually increase losses.

For example, a trader may open a trade and place theirstop loss, say, 20 pips away – based on the strategy they use. In other words, there is a technical or fundamental reason for it being placed where it is.

However, a trader that is influenced by fear may close the trade prematurely, simply because the trade temporarily goes against them. So if the trade goes against them by, say, 10 pips, then the trade results in a 10 pip loss. If the trade turns out to be a winner, then the trader has just turned the winning trade into a losing one out of fear.

Another scenario is when a trader closes their trade as soon as it has gone into profit, out of fear that they can lose that profit. If the trade then goes on to hit the profit target, then the trader has reduced a full winning trade down to a much smaller win.

This behaviour ultimately turns a profitable strategy into a losing one, because the trader reduces the amount of winning trades and/or reduces the profit overall because of fear of losing.

Greed results in trying to take too much profit and end up with less.

A trader under the influence of greed will try to go for more profit and will not close their trade when their strategy dictates that they should.

When a trader experiences greed, it means that they try to go for too much profit and deviate from their strategy. For example, a trader may place their profit target in accordance with their strategy. This means that – as with placing a stop loss – there is a technical or fundamental reason for doing so.

However, when greed influences a trader, they do not close their trade when the strategy has dictated they should – they try and go for more. What can happen is that the trade can turn against them, ultimately ending up with less profit, or worse, a losing trade. This means that they actually reduce the profitability of a strategy because they try to increase their profit through greed.

A trader influenced by ego will never admit they are wrong

Ego can affect a trader, causing them to not close trades when their strategy dictates they should or continues to trade on the same analysis after their trade has been stopped out, because they believe they are correct in their original assessment.

A trader under the influence of ego does not want to admit they are wrong.
For example, if the trade does not go well, instead of closing their trade according to the strategy, they carry on taking a bigger loss than necessary because they cannot admit that they are wrong.

Another scenario may be that after taking a loss on a perfectly good trade, they do not go on to look for the next setup according to their strategy. Instead, they continue taking trades based on their original analysis because they believe they were right in the first place.

Revenge trading is chasing the money you have lost on a trade

Revenge trading is when a trader chases the losses they have made – they are so focused on winning the money back that they fail to realize that they are not trading with a set of rules and each trade ends up resulting in another loss.

The importance of discipline when trading

To avoid emotionally influenced trading, you will need to build discipline that will allow you to think as objectively as possible. There are several ways in which you can do this:

Trade with a tried and tested strategy

You are much more likely to remain calm under pressure if you have confidence in your trading plan. If a strategy has not been tested enough, it may lead to doubts that could allow fear to overwhelm the trader.

Demo-account trading

Having confidence in your plan will help keep you calm under pressure. Test your strategy with a demo account and accept the risk, because a 100% winning ratio is unrealistic.

Testing and further development of a strategy should be done on a demo account first before using real money. Using real money creates an additional pressure that is likely to amplify negative emotions that are involved when trading, which can lead to further losses.

Accepting the risk

A strategy with a 100% winning ratio is unrealistic. You must be prepared to accept losses. It is normal to hope that every trade turns out to be favorable. However, inexperienced traders are likely to experience a stronger emotional impact when they take a loss. In contrast, a profitable trader is able to accept losses as part of the trading strategy and move on to the next trade, without allowing greed or fear to affect future decisions.

Summary

So far, you have learned that ...

• ... new traders make the mistake that skills in technical and fundamental analysis is the most important element in trading.
• ... controlling emotion is actually the most important skill that a trader should focus on.
• ... Dr. Van Tharp has broken down the trading process into three categories that affect traders: strategy, money management and psychology.
• ... psychology is ranked as the most important element, followed by money management and then the strategy. This highlights that regardless of how profitable a strategy is, psychology can impede the ability of a trader to make money.
• ... fear of losing can cause a trader to close trades early before the trade has run its full course, which can lead to further losses.
• ... greed can cause a trader to leave trade in and not close at the specified profit target when their strategy tells them too. This can run the risk of taking smaller profits if the market then turns against them.
• ... ego is when a trader does not admit they are wrong and can influence them to either not close their trades when their strategy tells them they should or keep trying to trade in the same direction after their trade is closed.
• ... revenge trading is where a trader tries to chase the money that they have lost without any regards to a strategy.
• ... having confidence in your trading plan and trading with a demo account ultimately helps with learning to control emotion.
• ... a strategy with a 100% win rate is unrealistic, you must be learn to accept the risk on each trade.

Credit:Tradimo