Tuesday, November 13, 2012

Do you have the nerve to trend follow?

Some more examples of recent profitable trends - in both directions. All it takes is to know what constitutes a good set up, only risk a sensible amount of your trading equity and place the trade. Then the psychology required to trend follow kicks in.

The questions you need to confront are these - would you have the nerve to sit on your hands and let trends such as these play themselves out? Other than update the stops per the system, would you be able to resist the fear of losing open profits such as these? Can you avoid the temptation of closing the position 'to bank the profits' because of some indicator signalling an overbought or oversold condition?

If you think you can answer yes to these questions, then you have the potential to become a profitable trend follower. Whether you can faithfully still say yes to those questions when you are actually in positions such as these, with your own trading equity on the line, only time will tell.

No comments:

Post a Comment