I was really bullish on the US dollar. I had done all my usually homework. Deep fundamental analysis. Sophisticated technical analysis. I had a plan that was dynamite! How could it go wrong?
Famous last words.
I was sitting and staring at the screen waiting for a big news item. Tick tick tick. I stare at the screen waiting for the news to come out so I can count my big big winnings.
Finally! The news flashes across the ticker!
It is strongly different from what I expected!
The gaps hundreds of pips in the wrong direction! It leaps over my stop loss so my very tight risk management is blown out of the water.
I call the broker to see if I am out of my position and where I was filled. The price is staggering. The gap is huge. The price I receive seems miles away from the price where I put my stop loss.
My eyes bug out and my stomach drops. I feel sick. I’m having a hard time calculate my loss. My eyes are blurring. My mind is blurring.
Finally, I stop trying to calculate my loss in my head and reach for a calculator. I punch the numbers. I can’t believe how much I’ve lost.
I do it again. Very slowly. The number doesn’t change.
I’ve lost $400,000 in a second.
I make sure that I’m out of my positions. I get up and walk outside.
I walk for several miles to a movie theater and watch a dumb action movie to get my mind off the disaster. But it doesn’t work.
The movie ends and I drudge back to my desk. I shake myself and tell myself that I have to get my act together and get back to what I know how to do, make money trading.
I was devastated but knew that I couldn’t let the devastation affect my trading. I went back to basics. To what I knew works.
I put my head down and focused on trading. The devastation occurred at the beginning of the month and I was back to break even by the end of the month!
My experience may be extreme for most traders because of the amount of the loss. But the emotional reaction is super common. Everybody feels terrible when they lose money trading.
I’ve put together a new course, my best course, called the Psychology of Massive Wealth. I’ll be sharing with you my personal value, ideas, and actions to conquer trading and even your whole life.