Coming back from the vacation can bring the several issues that you need to address promptly to get in the groove once again.
I wrote recently that during vacation times you could use these periods to try out a new strategy and test them to see if the warrant promotion to be included in TRADE PLAN.
In some cases, I have heard of traders returning from the vacation and for reasons unknown they break their TRADE PLAN. Your TRADE PLAN contains your tried and examined strategies that work with their entry and exit guidelines.
This year (2017) the Forex market has gone through lots of changes, different from the previous years, by this I mean the INTER-BANK markets suffering from vastly reduced profits and the markets, in general, have been very slow moving as a result.Having Read a little on this subject here are the top four items that might tempt you to break your TRADE PLAN.
Things to Avoid in Trade Plan
- Even though the Forex market never sleeps, especially in slow-moving markets periods of very slow market activity are increased. It can, therefore, be quite annoying when there is little or no activity waiting for a valid entry set-up to materialize.
- Many traders have reacted to BOREDOM by forcing the trades just to feel engaged with the market. To do this, they wander away from their TRADE PLAN and enter trades that would not normally be considered. This leads to poor trading decisions.
- If you find yourself tempted while being bored, walk away from the computer and neglect the charts alone. Abandoning your TRADE PLAN is NOT the solution.
- While boredom can lead to bad trading decisions, being surrounded by too much activity can also be very harmful. Your workspace must be conducive to trading. No distractions on the radio or the TV.
- Distractions can lead to a loss of focus.
- The markets are cruel and offer no justifications if you make an error on a trade. The markets are not forgiving.
- If you trade in a separate room maybe a “Do Not Disturb” notice is a start.
3. OVERCONFIDENCE / LOSS OF CONFIDENCE
- If you get on profitable trade after a successful run, you feel invincible. Should this happen never get so overconfident that you ditch your TRADE PLAN?
- That is a slippery slope that leads to a potential blow up of your trading account, as you fight poor trade after poor trade to get back losses.
- Everybody gets confident after some back-to-back profitable trades, but remember that it is extremely dangerous to be overconfident. Being overconfident can cloud your judgment and lead you down a trade route away from your TRADE PLAN. It could make you take invalid trade set-ups and risk position sizes that are too big or leave open a losing trade longer than your TRADE PLAN dictates.
- Likewise, having a lack of confidence as a result of back-to-back losing trades can lead you to abandon your TRADE PLAN. Lack of confidence can manifest itself in other ways, like closing a profitable trade earlier than you should because you are afraid of losing $$$.
- Sometimes it's hard, but the trick is to be able to cope with both a series of back- to-back profitable trades or back-to-back losing trades. Being able to treat them as one trade at a time, devoting your attention to the trade at hand, it makes it much easier to clear your head of past successes and failures.
- It’s not hard to lose your concentration if you are physically and mentally exhausted. It’s a recipe for disaster.
- When you are fatigued, you are not as sharp as you normally are. It can lead to slower reaction times, and you may not process matters as thoroughly. These factors can also lead you to trade outside of your TRADE PLAN and make some poor trading decisions.
- It sounds so obvious, but the solution is simple to take a break and get some test. Your account does not suffer if you step away and some of the most profitable trades to take are the ones that you do not initiate.
- You can do more harm and damage trading when you are not 100%.