Whew, this was a tough one.
The week started out like any other and I was excited to put in my first Accelerator Trade. I put in the usual lot sizes and the market started to move in my direction and quickly entered all 10 of my trades.
Click above to enlarge
It retraced a little and I figured no big deal, I’ll just wait it out like I usually do. The only trouble is that usually, I’m not watching the charts so closely.
The market made a very small correction and while I was watching my live P/L, I got really nervous. I know that this trade needs some room to breathe, but it got to the point where I couldn’t handle the pain.
Ever since I have started putting more significant money into my account, it has made me more and more cautious. Back when I had a tiny account, I guess I didn’t think that it would matter too much. Whatever the case may be, watching these trades does not help me at all.
So what can I do?
Well, first of all, let’s take a closer look at this trade on the 5 minute chart.
Click above to enlarge
As you can see, price almost got to the target and retraced. It made a weaker attempt at the target, then rocketed away.
I finally had enough and manually closed the trade. I ended up with a -17.7% loss on the account. This was not my biggest loss on a percentage basis, but it was my biggest dollar amount loss ever.
This trade bothered me so much that I listed some options in my trading journal that I could take to not have this happen again.
They are as follows:
- I could trade smaller lots
- I could (and should have) exited earlier with all ten lots on the line
- I could take profit earlier on the first 2-4 positions to lighten the load if it does drop
- I could set hard stop losses
- I could backtest more and figure out the optimal retracement level
- I could cut losses earlier
- I could NOT trade this strategy at all
In the end, I decided that taking losses quicker was the answer to the problem. Let’s see how that works out.
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