Patience Vs Being Stubborn
Patience, an ability or willingness to suppress restlessness or annoyance when confronted with delay. Stubborn, tenaciously unwilling or marked by tenacious unwillingness to yield. These two words and the definitions that follow are very important to the success of a trader. For me it is a very fine line and one that I must continually remind myself of. As I have mentioned before an EGO is a part of every Trader. Controlling it and excepting when you are wrong is a very powerful tool to have when developing a winning trading strategy.
The question is how? The answer…..well lets just say, it isn’t easy and as I like to say is a “work in progress”. Part of my trading style is to initiate trades that are following a trend (weaker Dollar, lower rates) and from there attempt to keep it until a fundamental change occurs to alter my view. I view an Economy like an ocean liner, the direction it is traveling cannot be changed quickly. Rather a protracted period of time where the economic numbers show a changing story. There are of course times when this is not the case. The latest credit crisis being an example, but for the most part I believe this is true. The problem is in a case like we currently have. I think things are turning from an economic perspective in a few Latin American countries and as such I think that rates could begin to move higher. Brazil seems to be showing signs of life. The Central Bank is signaling that Rates are not going lower and that they are getting uncomfortable with the strength of the Real. In spite of this the currency continues to strengthen and the yield curve is currently quite steep. Being long dollars or in a paying position can become costly. For me in a case like this I try not to use to much patience and look more for a “quick hit” I will buy Dollars but certainly not for a long term trend. Similarly with rates. I might enter into a payer position but only before a key economic number or some market situation (G7 meeting, Central Bank Meeting) that might shake up the market in such a way that could force profit taking or a change in direction.
Easier said then done but when placing a trade against the prevailing trend it is very important not to be Stubborn. It is the easiest way to lose big money for a trader.
Good Luck and Good Forex Trading.
Comments
One Comment on Patience Vs Being Stubborn
-
Jay on
Mon, 9th Nov 2009 11:54 pm
So, you’ve exposed yourself for the news punter that you are, eh?
The difference between being patient and stubborn is very difficult. In my experience, it is usually only in hindsight that the truth is revealed.
Trading: Surely the fastest way to slowly going nuts there is.
Tell me what you're thinking...
and oh, if you want a pic to show with your comment, go get a gravatar!
