Why you should never HOLD a boring trade - Rule I follow

Get in and get out in the shortest time possible.

This is the science of successful trading.

But what happens when a trade turns out to be more like a non-performing investment?

When you hold a long-term trade, there are a few issues that will follow including the:

Opportunity cost


You can find other higher probability trades, instead of having your money tied up aimlessly in a sluggish market.

Unnecessary impatience

You’ll eventually feel rather anxious and frustrated holding onto a long-term trade, when you are better off trading in a market that is moving.

The fake-out

With an ongoing trade, the breakout pattern may fizzle out into a low probability fake-out trade (a trade that turns against you).

I created a rule to avoid this situation from ever occurring again.

I call it a time stop loss...

After 7 weeks of holding a trade, exit the trade and look for a better opportunity.

Worst case you take a smaller loss than you thought.

Best case you take a smaller profit than you expected.

But you'll stop holding trades that aren't performing and stop paying daily costs with trading....

Sound good?

Trade well, live free.

Timon
MATI Trader