K.I.S.S. (Keep It Simple Stupid)

» Posted by on Mar 9, 2015 in My Blog | 0 comments

K.I.S.S. (Keep It Simple Stupid)

People, especially traders, have a tendency to overthink a situation. Overthinking a situation often lead to undertrading, overtrading and ultimately more losing trades than winning trades.

This is the main reason you need to have a trading plan. There is a saying “plan the trade and trade the plan.” By knowing how you will react in what situation you will rule out the “should I take this trade” or not syndrome which is the main cause of late entries which has a further problem of increased risk and less profit potential. When you are unsure of what you are going to do, you lose those precious moments when you can comfortable get into a trade. Then once the market starts to move you think “I better get in since its moving how I expected it” but the problem is the move has already started and you gave up a few ticks.

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