Today's post is more about professionalism in the face of failure then reporting any new setups. Recently, I had started to make the case for the Alt coins and their long anticipated catch-up rally to . While I still do feel that scenario has a high likelihood of playing out, this production is all about LTC's recent failure and how I acted in the face of the failure.
I personally am a big fan of the 'double bottom' price pattern (W's) to setup up long trades and whenever I see a within a I get really excited. So to that end, I bought the within the on LTC (indicated level on chart above) with the anticipation that LTC might do a similar price pattern move that did and/or at least test the highs at/near $14.20. I was willing to risk to the bottom of the (10.06). This represented about $1.00 of risk for $3.00 potential reward. Put it all together and I felt the setup was within my plan and I took it.
As I have repeatedly stated in the past, I have yet to meet a trader who was/is 100% accurate and I simply do not believe such a thing exists. Indeed, as a prop crude oil trader, many of my peers would shoot for 60% accuracy. The key here is, when they were right they got paid 2 to 3 times how much they lost when they were wrong.
So this brings us back to my LTC long setup. It indeed failed and now managing the loss is really a testament to my professionalism and how it's handled is a direct proxy on my career longevity. As a broker I would watch people sit on losing positions and literally let months/years go by enduring the loss. Not only does this do great psychological harm, but it also ties up capital which may have found new (maybe even better) uses. I shall not take that road. I am more than comfortable admitting the setup failed, exiting at my stop level and booking the small loss. I have done exactly that and shall now move on to new ideas.
Cheers all and hope it helps
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